MCO's protocols: Trade secrets or strange brew?

Who rules when creating practice guidelines?

The issue of gag clauses in HMO contracts exploded into front page news approximately a year ago. Congress passed new laws, insurers promised to back off, and physician groups sounded loud alarms regarding this and other questionable insurer practices.

But while national attention focused on what physicians supposedly could and could not say to patients, many other "trade secrets" or proprietary materials linger less visibly within the contracting process, experts warn. These quieter, more complex issues remain highly controversial and far from resolved.

Rather than rules governing what physicians can say, new rules tell physicians what they can do. Scores of rules already are cropping up - either implicitly or explicitly - in capitation contracts. Some rules require physicians to follow them to remain in the panel, while others pressure physicians on varying levels.

Physician input rarely sought

Physician opinions of these clinical guidelines run the gamut from excellent to devastating. "There is a plethora of guidelines for the same types of [clinical] problems," says Richard Mahood, MD, a gastroenterologist in Philadelphia and an American Medical Association (AMA) board member. Mahood has worked closely with AMA committees that specialize in capitation and medical ethics. He insists that physicians should have input into the development of guidelines. Some insurers, including Aetna-U.S. Healthcare in Mahood's community, have allowed physicians to participate in development and implementation of guidelines, although this is seldom the case.

Aetna-U.S. Healthcare officials recently drew national attention with a report stating that many physicians fail to follow insurers' practice guidelines, and in so doing, they are failing to provide optimal care, insurer officials argue. They worry that by overlooking well-established guidelines, physicians are shortchanging patients, and some physicians interviewed by Physician's Managed Care Report agree with the insurer. At the same time, Congress is looking hard at complaints from physicians that insurers are too stringently withholding payments for necessary care.

Proprietary guidelines especially rankle physicians. The language in a proposed contract typically will use the terms "trade secrets," "business secrets," or "proprietary information" to restrict physicians from disclosing any information about proprietary guidelines. These are guidelines or medical standards the HMO requires the physician to follow to be a paid provider, and typically these standards are based on information not disclosed to the physician. Therein lies the problem: The standards may be based on good clinical information, or they may not be, or they may be inappropriately biased by financial concerns. How is the physician to know?

A major culture gap exists between how physicians share new information and how businesses do it, points out Howard Brody, MD, PhD, director of the Center for Ethics and Humanities in the Life Sciences at Michigan State University in East Lansing.

Trade secrets can't be peer-reviewed

In the medical culture, physicians share information by doing research and having it peer-reviewed by professional colleagues for advice and recommendations, Brody notes. Once their research passes this group, it can then be published, sometimes with comments, and often with the reviewers' names. Also, the research process is clear from the start. From that point, physicians can feel the research has achieved at least a baseline credibility because several of their peers checked it out, and the research process is clearly laid out for anyone's review.

Not so in the practice of business, Brody says. "If a company has spent a good deal of money writing practice guidelines or developing a quality assessment tool, and thinks that having this in place will give its plan a competitive edge in the marketplace, then it would seem a particularly foolish business practice to let the whole world know about the method, so others may simply use it without having to reimburse for the development costs," he writes in a recent journal article for internists.1

Smart business practice would seem to require simply revealing to the physicians in the plan the existence of and content of the guidelines, without revealing to them how the guidelines were developed, he continues. As business managers, they may never realize that such trade secrets run counter to the scientific peer review process.

Not knowing how the practice guidelines were established is one issue. Beyond that is the issue of who created the guidelines, for what purpose, and for whose benefit. This is bound to be the sleeper issue of 1998, many experts predict - one that will explode onto the scene in the coming months, and which will take time to sort through.

Here are four prevailing points of view on who should provide guidelines:

· Payers. Consulting firms such as Milliman and Robertson in Seattle have a flourishing business from both insurers and employers based on developing cost-effective practice guidelines. Unless business pays for these initiatives, the much-needed cost savings won't occur, they argue, and they have a track record to prove it.

· Physicians. Too often, HMOs create guidelines without sufficient medical expertise; at the same time, physicians are developing guidelines without insurer collaboration, says Neil Baum, MD, a urologist in private practice in New Orleans.

HMOs need to lift the veil of secrecy around their guidelines, Baum contends. Insurers must allow physicians to use the insurer's data to determine the best clinical guidelines, and physicians must be allowed to deviate from guidelines without penalties. At the same time, physicians can agree by contract not to share important clinical discoveries with competing insurers, suggests Brody.

Referring to the advice from an expert in guideline development, Mahood adds, "You can take any guideline you want and assume it's going to be flawed. You work with it, interact with physicians and others involved, and educate one another in the process. A guideline is a living document."

· Consultants. The best way to go is to hire objective, independent consultants who specialize in developing clinically sound practice guidelines, says A. Jacqueline Mitus, MD, vice president of clinical services at InterQual, a Marlboro, MA-based provider of clinical decision support criteria. These should be developed by experts who have no stake in the outcomes of their application, she says. Even specialty medical societies can be suspect, she says, because one society often can differ from another, such as is the case between primary care and specialists.

Also, to be effective, criteria must be updated, annotated, and delivered in automated formats on an ongoing basis, says Mitus. Automation ensures that guidelines can be aggregated for analysis of care patterns and clinical outcomes on a consistent and replicable basis.

· Large group practice officials. Some of the larger medical group practices have been working on their own guidelines for several years, such as Fallon Clinic in Worcester, MA, and Henry Ford Health System in Detroit. Also, through the American Medical Group Association in Seal Beach, CA, shared committee expertise contributes to outcomes measurement and guidelines development.

Guidelines can offer clear advantages, too

What direction should your practice take? Clearly, different people have different perspectives, and not all practices are the same anyway. Baum's preference is to work with the insurer and to push for practice-specific guidelines. When he did this, he realized excellent clinical results. Also, by making the metastatic workup for the prostate process more consistent, the practice saved an average of $1,045 to $1,425 per patient on a high-volume procedure. That amounted to $193,325 to $263,625 in savings strictly for the 185 patients enrolled in the five-physician practice's capitation contract for that one service. (See a summary of how this was done on p. 117.)

Another advantage is that well-honed guidelines can be an excellent defense against malpractice allegations, says Eric Knox, MD, a gynecologist and medical director for MMI Risk Management Resources in Deerfield, IL. MMI refers to protocols as "risk modification guidelines." MMI's guidelines are developed by national task forces of practicing clinicians, Knox says. A recent review of MMI's claims data produced these two findings:

· For perioperative guidelines, the differential was $5,207 in malpractice claims for those who followed guidelines compared to $78,477 for those who did not.

· For emergency service guidelines, the difference was $1,304 in average malpractice claim costs for those who did adhere to risk modification guidelines vs. $24,659 for those who did not.

Tying practice guidelines to medical malpractice costs has proven to be highly effective, says Knox. MMI focuses on three high-cost areas of health care liability: delivery of babies, surgery that involves anesthesia, and emergency room care. This has made physicians more amenable to working with these guidelines, Knox says, because they don't attempt to cover every single area of physician practice.

Two other critical methods include first and foremost being aware of what you're signing in a capitation contract. Know whether you're actually signing a "hidden" agreement to follow the HMO's propriety clinical guidelines, advises Brody. Second, he recommends taking both individual and systemwide approaches.

Don't expect to resolve such a broad issue alone, Brody says. Instead, shore up your colleagues, hospital partners, and others to follow through on the question of who best develops clinical guidelines and for what purpose, until it is resolved for all parties involved - physicians, insurers, and most of all, patients.


1. Brody H, Bonham VL. Gag rules and trade secrets in managed care contracts. Arch Intern Med 1997; Oct. 13: 2,037-2,043.