When President Bush issued an executive order in August calling for health care providers to do a better job of reporting on cost and quality, he signaled an increasing nationwide concern for finding additional ways to reduce the rising cost of health care.

With new quality reporting tools, brokers have a great opportunity to demonstrate their value by helping clients achieve cost savings.

The growing prevalence of consumer-directed health plans gives consumers the responsibility to become more active participants in health care spending. But without more information about the cost factors associated with various aspects of health care, it’s difficult to do so.

Those of us who encourage consumer responsibility have a responsibility of our own. Doctors, hospitals, health plans, and brokers must work together to find ways of increasing transparency within the health care system.

To accommodate this new movement toward greater transparency, leaders from all parts of the health care system are developing new initiatives that focus on addressing issues of cost and quality. In California, for example, health plans and providers are engaged in efforts to improve quality and efficiency, measure deficiencies and improvements and provide incentives to encourage participation. Many of the programs are designed to provide data that can change behavior and influence consumers to pursue professional services that demonstrate high quality as well as low cost-and are delivered in the correct setting only when necessary.

Providers, health plans, and purchasers can use this data to lay a foundation for new strategies that promote cost and quality improvement.

–Providers are expected to employ similar cost and quality data when adopting and utilizing appropriate practice patterns. By doing so, they can earn rewards that are funded by health plans and endorsed by employer groups for implementing improvements in their practices.

–Health plans are being encouraged to strengthen programs that address utilization management, disease management and prevention, medical policy, and contracting strategies.

–Purchasers are leveraging their purchasing power to drive change through demand for new products and standards designed to lower costs and improve quality care.

Several initiatives have already shown promise.

Pay For Performance, or P4P, the nation’s largest provider incentive program, measures patient satisfaction, prevention, and chronic care management, together with measures that reward a physician group for investing in health care technology improvements.

The program uses a common set of performance measures for physician groups, developed collaboratively by health plan and physician group medical directors, researchers, and other industry experts. It is focused on improving care for common chronic conditions, such as asthma and diabetes, access to care, overall patient satisfaction and health care technology.

Patient satisfaction includes four areas: communication with the doctor, specialty care, timely care and service, and an overall rating of care.

Six clinical measures cover mammograms, pap smears, and childhood immunizations, plus a measure for asthma, diabetes, and coronary artery disease.

Health plans provide financial rewards for those providers who reach or exceed criteria developed by the Integrated Healthcare Association, Oakland, Calif., an industry collaborative.

Another collaborative project that will help to improve quality and drive down health care costs includes Better Quality Information, a physician pilot program that will measure quality and efficiency of health maintenance organization and preferred provider organization physicians’ practices.

Using aggregated claims data from major health plans, BQI will create a competitive benchmark that compares individual provider performance in an effort to moderate their use of expensive medical resources.

A new hospital-based program, the California Hospital Assessment and Reporting Tool, is measuring hospital quality against nationally recognized criteria that positively affect patient safety and clinical outcomes. The CHART program was just launched March 6. By encouraging public reporting and standardization of hospital performance measurement, CHART aims to reduce the administrative burden of hospital measurement, while stimulating quality improvements. (WWW.CALHOSPITALCOMPARE.ORG)

The Hospital Value Initiative is a similar effort that will measure and compare hospital cost efficiency.

To date, large client groups, such as the California Public Employees Retirement System, have been the primary participants in programs designed to measure and improve the efficiency and quality of health care delivery. CalPERS, for example, saved more than $40 million in health care costs by implementing a smaller provider network in 2005 and is expected to see about $50 million in savings this year.

But there’s no reason why small business owners shouldn’t benefit also from the information available through these programs. Brokers can be instrumental in providing those ‘show me’ factors that can educate and enlighten their client base on the ways that these programs can help drive cost savings and improve quality.

1. Website. Make your communication vehicles, such as web portals, more robust by including data from provider/health plan cost and quality programs. Employer group members will be able to view cost and quality information for their network providers and inform their employees about which providers can be accessed at lower out-of-pocket costs.

2. Presentations. Most of the data supporting these initiatives is readily available online and can be downloaded and shared over the Internet or printed to accommodate client presentations. Similar data from health plans and industry organizations, such as America’s Health Insurance Plans, Washington, also can be packaged and incorporated into presentations and handouts.

3. Customized Cost Projections. Health plans generally publicize the efforts that they have made annually to curb costs. Consider creating projections of potential cost savings that clients can gain as a result of greater transparency over 1-, 5-, and 10-year increments. Brokers can also develop customized profiles for each employer that gives specific cost and quality data for the providers in their networks. This empowers the end users and puts them in more control of their health care dollars.

4. Internet Links. Additional outreach efforts may include Internet links to sites that provide updated data on initiatives and programs. For example, health plans release information on programs such as P4P on an annual basis, which may available through a link on the carrier’s site. You can work with health plan account representatives to determine optimum ways to inform clients about important cost and quality initiative results. Federal and state government agencies also release data on provider cost and quality, giving brokers additional information to share and discuss with clients that may have an impact on their health care needs and decisions.