Outline. Background. Public Reporting & Pay for Performance in Hospital Quality Improvement

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Hortense Dean
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1 Public Reporting & Pay for Performance in Hospital Quality Improvement Peter Lindenauer MD MSc Associate Professor of Medicine Tufts University School of Medicine Outline Review forces driving PR and P4P Highlight inpatient PR and P4P programs Examine evidence for benefit Background Public reporting and pay for performance programs are proliferating in the US and worldwide Hospitals Nursing home Ambulatory care Federal mandate is accelerating process Deficit Reduction Act (2005) required CMS to develop plan for Value Based Purchasing (P4P) by

2002 Hospital Quality Alliance Driving Forces National imperatives Improve quality and safety faster Reduce

2 Still controversial after all these years c.1860 Florence Nightingale Mortality rates at London hospitals c.1917 Ernest Codman Surgical outcomes in Boston c.1990 NY CABG Report Cards c Hospital Quality Alliance Driving Forces National imperatives Improve quality and safety faster Reduce costs Cultural changes Increasing consumerism Information technology Ubiquity of personal computers Internet / World Wide Web How do you choose a tire? 2

3 Benefits of Public Reporting Improves transparency of health system Empowers patients to make better choices Strengthens the business case for quality Stimulates interest among clinicians, administrators, trustees in quality of care Hospital Quality Alliance (HQA) Public-private collaboration begun in 2002 AHA, AAMC, FAH, CMS All hospitals invited to particpate Participation linked to Medicare s annual payment update. P4R To invigorate efforts to improve quality Initially 10 measures over 3 conditions AMI, HF, Pneumonia Has expanded annually; now >20 measures Available on Hospital Compare website 3

Hospital Public Reporting P4R 0.4% Incentive 4043 4192 1407 1952 434 August, 2003 February, 2004 May, 2004 October, 2004 March, 2005 Number of Reporting Hospitals 98.

4 Hospital Public Reporting P4R 0.4% Incentive August, 2003 February, 2004 May, 2004 October, 2004 March, 2005 Number of Reporting Hospitals 98.3% of PPS hospitals now reporting Hospitals, if they wish to be sure of improvement, must find out what their results are, must analyze their results, and must compare their results with those of other hospitals. Ernest Codman

5 How much do the patients care? The information age A world of options 5

6 A well educated patient will choose the best Craig Smith Chief CT Surgery Columbia s Risk Adjusted Mortality was ~ 2X the NY State average 6

Why would Bill Clinton go to the worst CABG hospital in New York? Anyone can have a bad year. Clinton understood this and was willing to give them another shot.

7 Why would Bill Clinton go to the worst CABG hospital in New York? Anyone can have a bad year. Clinton understood this and was willing to give them another shot. Clinton knew that the risk adjustment model didn t adequately account for the complexity and severity of cases at Columbia Like other New Yorkers he didn t base his choice on report cards / publicly reported data Proximity, word of mouth, and established referral patterns more powerful determinants of where we obtain care. Pay for Performance Rewards excellence directly Not reliant on behavior of patients Strengthens the business case for quality Reverses perverse financial incentives Additional payments received by hospitals following complications; regardless of their preventability >100 pay for performance initiatives being sponsored nationwide 7

CMS / Premier Hospital Quality Incentive Demonstration (HQID) To determine if economic incentives are effective at improving the quality of inpatient care 1-2% year end bonus payment to hospitals in

8 CMS / Premier Hospital Quality Incentive Demonstration (HQID) To determine if economic incentives are effective at improving the quality of inpatient care 1-2% year end bonus payment to hospitals in the top 2 deciles of performance on composite measure Average 71k; Range 1-875k 33 Measures across 5 Conditions AMI, HF, Pneumonia, CABG, TJR 266 (63%) hospitals agreed to participate An important question Given the widespread use of public reporting, how much benefit will be gained from the addition of financial incentives.very impressive gains 8

Teaching Status, Location, etc Excluded Perspective hospitals that had declined to participate

9 So, how much benefit, really? Methods Matched each HQID participant with similar hospitals from larger HQA universe* Size, Teaching Status, Location, etc Excluded Perspective hospitals that had declined to participate from the control group Calculated 2 year absolute improvement % for individual and composite quality measures Calculated the difference in improvement at P4P and PR hospitals. 9

Contribution from other factors Stratified analyses evaluated impact of Teaching status Bed size Baseline performance Adjusted Outcomes Multiple linear regression applied to the matched sample to

10 Contribution from other factors Stratified analyses evaluated impact of Teaching status Bed size Baseline performance Adjusted Outcomes Multiple linear regression applied to the matched sample to control for differences in baseline performance of the two groups of hospitals Analyses repeated using entire pool of HQA hospitals without matching In additional analysis based on the intent to treat concept we attempted to control for volunteer bias among P4P hospitals by including decliners and withdrawers in the P4P group 10

Limitations Did not have a control group not exposed to either P4P or PR Only able to describe the incremental benefit of P4P when combined with PR.

11 Limitations Did not have a control group not exposed to either P4P or PR Only able to describe the incremental benefit of P4P when combined with PR. Not the benefit of PR or of P4P Our analysis limited to 10 of the 33 measures included in the HQID Cannot comment on CABG, TJR Did not assess improvement in outcomes 11

standards High baseline performance on measures 7 of 10 measures had rates ~ 90% Maximum absolute % improvements were small Approach to representing improvement may have minimized effect Alternative

12 Is the P4P glass half full or half empty? January 25th 2007 January 26th 2007 Explanations for limited impact Public reporting sufficient motivator Small marginal benefit from P4P Financial incentives too small 1-2% bonus small by exec pay standards High baseline performance on measures 7 of 10 measures had rates ~ 90% Maximum absolute % improvements were small Approach to representing improvement may have minimized effect Alternative - relative reduction in failure (akin to clinical trials) Sobering words If we are going to put very strong incentives on quality measures, let s make really sure that we know this measure will improve outcomes. Right now, we don t have enough validated measures. In that sense, I don t think we are ready for a national (pay-for-performance) system, Mark Chassin, President Joint Commission 12

Value based Purchasing Legislation, Methodology, and Challenges

Value based Purchasing Legislation, Methodology, and Challenges Maryland Association for Healthcare Quality Fall Education Conference 29 October 2009 Nikolas Matthes, MD, PhD, MPH, MSc Vice President for