Quality and Cost: Healthcare Leaders Learn How to Redefine Value
By Degaspari, John | Proquest LLC |
Provider organizations take on difficult initiatives to change the value equation in care delivery
Is the healthcare industry at a tipping point, where the clinical and financial sides of the industry are beginning to come together to work toward the common goal of value-based care?
In a compelling keynote presentation at the
Gawande, the noted author of several books, including The Checklist Manifesto: How to Get Things Right, told his audience that while it has long been known that 5 percent of the sickest patients account for 50 percent of the costs, many in the industry have miscalculated what it meant. The reason for that miscalculation, in his view, is that the financial professionals who know about the largest share of healthcare spending are different than the clinicians who care for the sickest patients who account for those costs-and the two groups historically have not talked to each other.
That is now changing: "We are just starting to discover what happens when you put the 'you' and T together," he told the audience of financial professionals. "When they do communicate, it's a pretty stunning thing."
He offered an example of changes in hospital practices that are resulting in dramatic improvements in patient care, along with major potential cost savings. His team at
Where it was deployed in eight hospitals globally in 2009, every hospital saw a reduction in complications and deaths-an average 35 percent reduction in complications and 47 percent reduction in deaths. He also noted that the checklist was rolled out across 74 hospitals in the
DATA AND TRANSPARENCY AT
Yet the task of implementing such costsaving initiatives can be challenging. One major hospital system that has adopted the surgical checklist to its op- erating rooms is
Lester says the preparation for the project took an entire year of work that involved going into the ORs of the system's wholly owned hospitals, and speaking with the doctors, nurses and anesthesiologists. "The idea was to customize the WHO checklist to their environment and to their workflows," he says.
The team then stepped back, and gathered a baseline of 2010 data, the year that preceded the work of implementing the checklist. "The baseline was a look at the economics of its surgical patients and the complication rates," Lester says. The complication rates were gathered from examining the health system's coded data used for billing purposes. From that information it developed 10 categories of complications that followed surgery. "We saw in that year what our complication rates were, and that it was within the range of published complication rates," he says, adding that the complication rates were correlated with economic data.
The study findings that were published in JAMA were eye-opening: hospital revenue was roughly 330 percent higher when patients who had private insurance coverage had at least one complication following surgery (
Lester says that
He declined to comment on the data specifically at this point, before a rigorous analysis of the data is performed. Nonetheless, on its website,
In a separate initiative, launched in April,
Transparency is at the root of the initiative, he says. "At the external level we have made a decision to publish quality and safety metrics, because we believe that transparency is what is needed to drive accountability in the organization, and ultimately to improve it," he says.
The initial reports will include 15 indicators made up of about 300 metrics. The report displays clinical results, including complication rates and the number of procedures performed at each wholly owned hospital. Velasco notes that the metrics are from third-party organizations, and not proprietary to
"Healthcare organizations that do a better job of providing excellent qual- ity tend to be more cost effective, which leads to decreased costs associated with inefficiency and inappropriate care," Velasco says. He adds that the transparency of the quality data in the reports puts
Velasco notes that although the majority of
VALUE-BASED REIMBURSEMENT ON A STEADY CLIMB
A report released in June by
Among the report's main findings are:
* Ninety percent of payers and 81 percent of providers use some mix of value-based reimbursement with fee-forservice. Yet the organizations using mixed models anticipate significant growth of value-based care, which will make up two-thirds of the market by 2020, up from one-third today. Providers using mixed models expect fee-for-service to decrease from 56 percent today to 34 percent five years from now.
* "Collaborative" regions, where one or two payers and providers stand out, are more likely to be aligned with value-based reimbursement than "fragmented" regions, where there are no clear market leaders among payers or providers.
* Forty-five percent of providers surveyed are part of an accountable care organization (ACO), and are significantly more likely to feel that transi- tion to value-based reimbursement will have a positive financial impact on their organizations compared to those that are not in an ACO.
* Although all of the existing valuebased reimbursement models are expected to grow, payers and providers predict that the proportion of their total business that is aligned with pay-for-performance will experience the most growth, followed by the episode-of-care model. Nonetheless, 15 percent of payers and 22 percent of providers characterize pay-for-performance as difficult to implement.
* The primary obstacles payers and providers say are urgently needed to address to enable value-based reimbursement are technology-related; and existing healthcare IT systems are not aligned with value-based reimbursement.
* While technology to catalyze physician engagement is critical, lack of physician buy-in was the number one challenge cited by both payers and providers.
Larger organizations in a region that is defined by a grouping that is more collaborative with payers, and that also has some type of ACO model, are more likely to be aligned with value-based reimbursement, she says. Smaller institutions, as well as those that are not part of an ACO model, are less likely to be aligned. That's partly a result of lack of resources, she surmises, but she adds that in fragmented regions, there is not enough alignment between providers and payers to allow value-based reimbursement to happen.
She notes that payers are not sharing clinical and financial with other payers to a large extent today; but "a significant proportion of them do expect that will be happening in the next several years." She says there will be a demand for technology to allow that to happen.
Adds
Nace adds that physician buy-in is crucial to value-based reimbursement. "You have got to have the stakeholders understand this new model of care and understand how to use the technology in a value-based world." He adds that education, buy-in and collaboration within the organization are critical.
Interestingly, about 60 percent of the payers surveyed by ORC think that the transition to value-based care will have a positive impact on their organizations, while only 50 percent of the providers think it will have a positive impact. According to Nace, although many providers may be skeptical of being evaluated on their performance, cost pressures are moving the industry toward value-based reimbursement. Payers have been concerned about their ability to survive in the model they have been using, while hospitals have been under extreme pressures as their margins are projected to decline, he says.
A MEDICAL GROUP IMPLEMENTS POPULATION HEALTH
The
"Good quality is, at the end of the day, cost-effective care. I strongly believe that, and that is the fundamental axiom that we believe in our group," Florio says. Yet aligning a group practice to value-based care has not been an easy undertaking, and requires an assumption of risk and a close eye on costs.
Pioneer operates three lines of business under the coordinated care model:
In the capitated model for
It also assumes delegated functions, including claims, adjudication, and payment. This requires a system that takes care of all of the professional claims, both within the group and outside the group; handles credentialing of all the physicians within the group and outside the group; has a quality management program that monitors quality, monitors patient complaints, monitors patient satisfaction, and deals with the issues and has appropriate action plans; and shows improvement.
Pioneer Medical uses a shared risk model, where it gets a cap for professional services. The health plan sets aside a certain amount of money for institutional costs, and if there is money left over, it will share that profit with the medical group. That incentivizes the medical group to be more efficient in the use of the hospital system, he says.
When it is contracting with the health plan, Florio says the medical group has to know the patient data and whether it has a sicker population that needs more resources allocated for care, when negotiating with the health plan. "That requires good data. You have to adjudicate your claims and pay the bills correctly, based on the contracts you have. That's very important, so you need a good claims shop; and you need a hospital that understands all these things and is willing to work with you," he says.
Within Pioneer Medical, its employee-based physicians understand valuebased care, Florio says, but he adds that there is a potential problem when it's necessary to reach outside the group to a specialist, who is being paid on the fee-for-service model. "
Florio says it's necessary for physicians to know what their requirements are in terms of quality care. Even more important, he says, are what he calls oversight committees to make sure that the objectives are met. Pioneer Medical has three major committees, all of which are staffed by clinical representatives, that are charged with keeping an eye on costs and making sure appropriate care is given. These include a utilization management committee to determine if appropriate care is being given to the patient; a pharmacy and therapeutics committee to manage drug costs; and a quality group to monitor for potential abuses.
He notes that preventative services are absolutely essential to his medical group, which also offers case management services for patients who are not compliant with their medications or who do not understand their treatment well, as well as homebound services. Data, including ICD codes, patient demographic information, lab data, pharmacy data and access to hospital data are all important to these services, he says.
The most important thing, Florio says, is to convert the data into useable information. "We want the doctors to focus on taking care of patients," he says, adding that the expertise of a technology partner is important to providers.
In the view of
WE ARE JUST STARTING TO DISCOVER WHAT HAPPENS WHEN YOU PUT THE 'YOU' ANO T TOGETHER. WHEN THEY COMMUNICATE, IT'S A PRETTY STUNNING THING.
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WE TAKE IT AS A GIVEN, AND IT HAS BEEN DEMONSTRATED IN THE LITERATURE AND IN EXPERIENCE, THAT WHEN YOU IMPROVE QUALITY, COSTS COME DOWN.
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GOOD QUALITY IS, AT THE END OF THE DAY, COSTEFFECTIVE CARE. I STRONGLY BELIEVE THAT, AND THAT IS THE FUNDAMENTAL AXIOM THAT WE BELIEVE IN OUR GROUP.
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Copyright: | (c) 2014 Vendome Group LLC |
Wordcount: | 3068 |
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