Press Release

Thursday, March 1, 2018
Media Contact:
Skye McIntyre-Bolen

Integrated Healthcare Association (IHA) Releases 2nd Edition of the California Regional Health Care Cost & Quality Atlas

Oakland, California

Updated Snapshot for 29 Million Insured Californians Highlights Pre- and Post-Affordable Care Act (ACA) Quality and Cost Changes, Wide Geographic Variation, and Value of Integrated Care

Health care quality and cost for commercially insured Californians varied dramatically in 2015, indicating that where you live affects the care you receive and how much it costs, just one of the new findings from the California Regional Health Care Cost & Quality Atlas. Developed by the nonprofit IHA, in partnership with the California Health Care Foundation (CHCF) and California Health and Human Services (CHHS) Agency, the Atlas is the state’s source of comparable performance information about the quality and cost of care provided to 29 million Californians. 

The second edition of the Atlas brings together 2013 and 2015 multi-payer data by geographic region—including commercial insurance, Medicare, and Medi-Cal—on more than 30 standardized measures of health care quality, cost, patient cost sharing and utilization to help purchasers, health plans, and policymakers target performance improvement initiatives. An IHA fact sheet provides more details about the Atlas and measures. 

In 2015, clinical quality varied across the state’s 19 geographic regions by an average of 25 percentage points and costs ranged from 22 percent below to 29 percent above the statewide average. These differences mean:

  • If care for all commercially insured Californians were provided at the same quality as top-performing regions, nearly 205,000 more people would have been screened for colorectal cancer and 31,000 more women would have been screened for breast cancer in 2015.
  • If care for all commercially insured Californians were provided at the same cost as observed in San Diego―a relatively high-quality, low-cost region―overall cost of care would decrease by an estimated $2.6 billion annually, or about 5 percent of the $55 billion total cost of care for the commercially insured.

“Increasing transparency is essential for improving quality, lowering cost and gaining consumer confidence. Atlas 2 shows where quality and cost are trending in the right direction and where there is room for more improvement,” CHHS Secretary Diana Dooley said.

The Atlas also highlights differences and trends by product type. In 2015, commercial HMOs outperformed PPOs on average by 14 percentage points across 10 clinical quality measures of preventive, acute, and chronic care, and did so at a 9 percent average lower total cost of care. At the same time, PPO quality improved markedly since Atlas 1 results from 2013, showing a 7-percentage point improvement. PPO-based accountable care organization (ACO) care models, which stress greater care integration, performed better than the general PPO population, which may have been a factor in improved overall PPO clinical quality from 2013 to 2015.

“The Atlas is a great tool to improve health care quality and affordability by giving consumers, physicians, and health plans better insights regarding how to increase performance,” said Paul Markovich, President and CEO, Blue Shield of California.

The high value delivered by commercial HMO products, which typically use integrated care networks, had a significant positive financial impact for consumers as well. Patient cost sharing in PPOs in 2015 was $838 per member versus $69 per HMO member. The 4.3 million PPO members included in Atlas 2 paid an additional $3.3 billion out of pocket for covered care in 2015 compared to HMO members. Results for Medicare Advantage (MA, HMO) compared to fee for service (FFS) Medicare are even more striking. MA outperforms FFS on quality by an average of 22 percentage points and shows a 25 percent better total cost on a risk-adjusted basis.  Given the costs of care for the Medicare population, this translates to thousands of dollars of savings per member, including on average $1,800 per member in out of pocket costs.

“The continued high value performance of integrated care in both commercial and Medicare HMO products is critical and not subtle, including the lower costs directly experienced by patients,” said Don Crane, CEO of America’s Physician Groups. “The potential contribution of integrated care systems to improving quality in PPO products is an important new finding, suggesting that integrated care can be successfully delivered by medical groups and independent practice associations in multiple product designs.”

For the 11 million Californians now enrolled with full scope benefits in the Medi-Cal program, overall quality performance decreased from 2013 to 2015. During the same period, there were millions of new enrollees through the ACA coverage expansion. The rate of Medi-Cal emergency department (ED) visits also increased from 2013 to 2015; however, regions with the greatest increase in ED visits were not necessarily regions with the largest enrollment increases.

Sandra Hernandez MD, CEO of the California Health Care Foundation (CHCF), said, “Strengthening Medi-Cal would have an exponential impact on the health of the state as a whole. The Atlas gives everyone who has a stake in the program a clearer picture of where there is stress in the system while also providing a tool to target improvement."

With continued CHCF support and participation by health plans, IHA will update the Atlas with 2017 data by the end of 2018. Continued tracking of regional performance on key quality and cost measures through the Atlas can provide a roadmap to reduce unwarranted cost and quality variation and advance high-value care for all Californians.