RAND Study Raises Concerns About Accuracy of Physician Cost Profiles

The cost profiles insurance companies create for physicians based on their cost of care can vary widely, raising questions about the accuracy of the profiles, according to a new study by the RAND Corp. Insurance companies use these profiles to encourage patients to visit lower-cost physicians.

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Between 17 percent and 61 percent of physicians would fall into a different cost category depending on the methods used, according to a RAND news release on the study. Insurers use these cost categories, along with quality scores, to assign physicians to performance tiers.

RAND examined information from four commercial health insurers in Massachusetts that together enroll 1.1 million adults, according to the release. The results showed that a physician’s cost category could vary from one insurer to another based on the methods used.

The study suggests insurance companies should increase their transparency about their physician profiling methods, Ateev Mehrotra, MD, a RAND researcher and professor at the University of Pittsburgh School of Medicine, said in the release.

Read RAND Corp.’s news release about the study on physician cost profiling.

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