The Wisconsin Health Information Organization - which includes managed care companies, employer groups, hospitals and doctors - plans to create the state's largest warehouse of information on how hospitals and doctors treat patients.

The organization includes four of the state's largest managed care companies - and that sets it apart from other groups analyzing health care costs. The companies, which historically have not shared information, will pool their data, without patients' names, on health insurance claims.

"This is really cutting edge," said David Dranove, a health care economist at Northwestern University.

The plan is to sift through millions of health insurance claims to find out which doctors and hospitals consistently provide quality care at the lowest cost - in other words, are the most efficient. And at least some of the information eventually will be made public.

The task will mean looking at more than who has the lowest prices. And it will mean looking at more than the quality of care.

What doctors charge for office visits, for example, means little if they make the wrong diagnosis. And providing quality care can be extremely expensive if a doctor orders unneeded tests. The key to reducing health care costs is measuring efficiency, said John Toussaint, chairman of the Wisconsin Health Information Organization.

"Until people know where they stand, we are not going to make any improvement," said Toussaint, a doctor and chief executive of ThedaCare, a health care system in the Fox Valley. "You manage what you measure, and until we have good measures, we are not going to make any progress."

One study published in the New England Journal of Medicine in 2003 found that patients did not receive the recommended care 46% of the time and 11% of the time received care that was not recommended and potentially harmful.

The hope is that learning which doctors and hospitals are the most efficient and effective will lead to more standardization in how medicine is practiced. That could reduce the widespread variation that plagues the health care system and, in turn, lower costs.

"Standardization is the way you get to high quality and low cost," Toussaint said.

Pooling data on insurance claims is just the start.

The Wisconsin Health Information Organization must figure out how to analyze the information. Software can help. And the nine founding members each have pledged $150,000 over three years to the new organization.

Still, analyzing millions of insurance claims won't be easy. Accepted quality measures are beginning to emerge for hospitals, but less progress has been made in developing ways to measure the quality of care provided by individual physicians.

Yet doctors have the dominant role in the health care system.

"The physician's pen is what is driving the cost of care," said Toussaint, who was one of the leaders in creating the new organization.

The Wisconsin Health Information Organizations will have to find ways to adjust for patients who are more sick than others when measuring efficiency. Adjusting for risk is a contentious issue in attempts to measure quality.

"It isn't perfect," Toussaint said. "But it can be done, and you've got to start somewhere."

Clear protocols don't exist for much of what doctors do. But they do exist for common diseases - such as asthma, diabetes and heart failure - that account for a large share of health care spending. And the measures are expected to get better with time.

"Once people start getting measured, they will want to make sure it is done right," Dranove said. "And we will get better and better measures."

What also could set the Wisconsin Health Information Organization apart is its founding members, include the Wisconsin Medical Society.

Doctors and their professional societies in general have been slow to embrace the national push to develop standard measures of health care quality. An article published this year by the Commonwealth Fund, which supports research on health and social issues, described them as "notably absent" from the discussions.

But that's changing.

Employers and managed care companies are beginning to demand information on quality. And doctors are expected to become more open to developing standard measures as so-called pay-for-performance programs become more widespread.

The new organization is an outgrowth of the Wisconsin Collaborative for Healthcare Quality and includes hospitals, specialty physician groups, employers and labor organizations.

In the Milwaukee area, its members include Columbia St. Mary's, Froedtert & Community Health System and the Medical College of Wisconsin. They also include Advanced Healthcare S.C., Medical Associates Health Centers, Covenant Medical Group and other physician practices.

The collaborative's goal was to set up a data repository for insurance claims, and that information is considered essential in any effort to gauge efficiency.

"Everybody understands the need of doing a better job promoting quality and promoting efficiency," said Dranove, the health care economist. "And everybody agrees the biggest obstacle is data."

The nine founders of the Wisconsin Health Information Organization include Blue Cross Blue Shield of Wisconsin, UnitedHealthcare of Wisconsin, Humana and WPS Health Insurance. The Wisconsin Department of Employee Trust Funds, which oversees the health and benefit plans of state employees, also will provide data.

To varying degrees, managed care companies have begun trying to gauge efficiency on their own. UnitedHealthcare, for example, has started rating doctors on quality and efficiency.

In some ways, this is an extension of what the company already is doing, said Glenn Reinhardt, executive director of UnitedHealthcare of Wisconsin.

But Reinhardt said the company sometimes doesn't have enough information to provide a rating.

Further, even the largest managed care companies may not be able to gauge how a doctor treats a specific illness. People also change health plans. By pooling claims data, the Wisconsin Health Information Organization will be able to track a patient's care over time.

"None of us get to see the whole picture," said Stuart Campbell, president of Blue Cross Blue Shield of Wisconsin, a unit of WellPoint Inc. "This is a chance to see the whole picture."

Managed care companies also know they can't make the health care system more efficient solely by trying to negotiate better discounts with hospitals and doctors.

The rise in health insurance premium shows that. The key will be making the health system more efficient. And the Wisconsin Health Information Organization hopes to have a part in that.

"We do a lot of business in a lot of states at WellPoint," Campbell said. "And Wisconsin is at the leading edge."