• payments to physicians, including bonuses related to cost containment and quality of care.

Other types of information that should help to make sure that health plans know that they are being carefully watched for misbehavior include enrollee complaints. The Minnesota HMO law, for example, requires each health plan to list its four highest administrative (e.g., scheduling) and four highest clinical (e.g., poor service) complaints and describe what is being done to deal with them. This information needs to be part of each plan's marketing material.

Option #2. Create Medicare ombudsman offices. A network of Medicare ombudsman offices, operating in areas with significant Medicare health plan enrollments, could be provided to assist Medicare enrollees who are considering health plan enrollments and those who have complaints about their health plans. The Medicare program now has an underdeveloped consumer assistance function; its placement of personnel in local Social Security offices ceased when HCFA was created. Assistance in addition to enrollment would be useful because of the many potential problems that consumers can encounter. The Medicare data on health plan performance show complaint rates that vary by a factor of 25:1, from 0.18 complaints per 1,000 enrollees for Group Health of Puget Sound to 4.58 complaints per 1,000 enrollees at Humana (Florida). The ombudsman office would assume some of the functions normally undertaken by an employer benefits office on behalf of employees in trying to deal with health plan issues that arise in day-to-day operations. The ombudsman could have the right to investigate patient complaints; to make unannounced inspections of facilities and records; to make public reports on findings; and to seek actions from DHHS such as "cease and desist" orders, suspension of new enrollments, and fines and U.S. Justice Department and state attorney general referrals for instances of criminal negligence, recurrent malpractice, and other egregious misbehavior. Various ombudsman functions could also be carried out by state and local governments and by private sector groups.

Option #3. Create voluntary consumer purchasing cooperatives. An idea recently proposed by David Kendall of the Pro-



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