1 IMPROVING HEALTH CARE QUALITY THE ROLE OF PAY-FOR-PERFOMANCE TOM DEAN M.D.

2 QUALITY WHAT IS IT? WHO DECIDES? -PHYSICIANS? -PATIENTS? -GUIDELINE WRITERS? -PAYERS?

3 HOW DO WE GET THERE? PAY FOR GOOD CARE- DON'T PAY FOR BAD CARE (IN OTHER WORDS – PAY-FOR-PERFORMANCE) THIS IS WHERE IT BEGINS TO GET MORE COMPLICATED!!

4 QUESTIONS 1) How do we decide what is good care? 2) Who do we pay? 3) How much do we have to pay? 4) Does it make a difference?

5 HOW DO WE DECIDE WHAT IS GOOD CARE? (NOT AS EASY AS IT SOUNDS!!) * PERFORMANCE MEASURE SELECTION IS CRITICAL (AND VERY DIFFICULT!!) - NEED TO BE EASILY QUANTIFIED (COUNTABLE) - NEED TO REPRESENT A BROAD SPECTRUM OF CARE -SHOULD NOT SHIFT ATTENTION OF CARE GIVERS AWAY FROM OTHER AREAS OF CARE

6 SIGN HANGING IN ALBERT EINSTEIN'S OFFICE “NOT EVERYTHING THAT COUNTS CAN BE COUNTED, AND NOT EVERYTHING THAT CAN BE COUNTED COUNTS.”

7 HOW DO WE DECIDE WHAT IS GOOD CARE? (CONTINUED) *EXISTING EVIDENCE-BASED GUIDELINES ARE OFTEN TOO SIMPLISTIC FOR REAL LIFE CLINICAL SITUTATIONS. *THERE IS A RELATIVELY POOR COORELATION BETWEEN PATIENTS' GLOBAL RATING OF CARE AND THE TECHNICAL QUALITY OF CARE (CHANG)

8 WHO DO WE PAY? * HOSPITAL VS PHYSICIANS * INDIVIDUALS VS GROUP/SYSTEM * HOW DO YOU DIVIDE UP RESPONSIBILITY? * DO WE PAY FOR IMPROVEMENT IN CARE OR ONLY FOR CARE THAT MEETS A SPECIFIED THRESHOLD?

9 HOW MUCH DO WE PAY? * ARE POTENTIAL INCENTIVES ENOUGH TO OFF SET REQUIRED INITIAL INVESTMENT? * IF WE SIMPLY REDISTRIBUTE CURRENT PAYMENTS (WITHHOLD MECHANISM) WE MAY WELL PENALIZE THOSE WHO INVEST IN IMPROVEMENT ACTIVITIES BUT DON'T SEE IMMEDIATE RESULTS. - RISK OF CREATING NEGATIVE INCENTIVES

10 DOES IT ALL MAKE A DIFFERENCE? LITERATURE IS GROWING * 6 STUDIES PUBLISHED IN THE LAST 24 MONTHS -MOST SHOW MODEST POSTIVE IMPACT. “ Hospital performance predicts small difference in risk adjusted mortality rates” (Werner, JAMA, DEC. 13, 2006, P. 2694) “Current heart failure measures have little relationship to patient mortality” (Fonarow, JAMA, JAN. 3, 2007, P.61) “Pay for performance yielded modestly greater improvement than reporting alone” (Lindenauer, NEJM, FEB.1, 2007, P.486.)

11 CMS DEMOS * PREMIER HOSPITAL DEMO - VOLUNTEER HOSPITALS PAID BONUS FOR IMPROVING CARE FOR CABG, ACUTE MI, HIP & KNEE REPLACEMENT, HEART FAILURE AND PNEUMONIA -SHOWED IMPROVEMENT IN CARE ACROSS THE GROUP WITH SIGNIFICANT DECREASE IN COSTS. * PHYSICIAN GROUP PRACTICE DEMO (PGP) -10 PHYSICIAN GROUPS PAID BONUS TO IMPROVE CARE. -ALL IMPROVED CARE. -ONLY 2 GROUPS EARNED BONUS.

12 RURAL IMPLICATIONS RURAL FACILITIES/PRACTICES OFTEN START AT A DISADVANTAGE *SMALLER *LESS TECHNOLOGICALLY DEVELOPED (EMR, ETC.) - DATA COLLECTION INFRASTRUCTURE IS LESS SOPHISICATED * OPERATE ON THINNER MARGINS *SERVE A HIGHER PROPORTION OF MEDICARE PATIENTS THAN THEIR URBAN/SUBURBAN COUNTERPARTS *PATIENTS ARE OLDER, POORER, SICKER ON THE OTHER HAND: *SMALL SIZE USUALLY ALLOWS MORE FLEXIBILITY AND EASIER CHANGE *TEND TO BE MORE COMMUNITY ORIENTED AND COMMUNITY RESPONSIVE.

13 WHERE DO WE STAND NOW? * WE ARE FEELING OUR WAY -VERY COMPLEX UNDERTAKING - GREAT RISK OF UNINTENDED CONSEQUENCES - MUST NOT LOSE SIGHT OF THE GOAL OF “RAISE ALL BOATS”. * WE NEED TO CONTINUE! * BEST SUMMED UP BY DR. ELLIOTT FISHER “ WE SHOULD IMPLEMENT PAY FOR PERFORMANCE AS A WAY TO LEARN HOW TO MODIFY THE PAYMENT SYSTEM TO FOSTER HIGH PERFORMANCE AND SYSTEMWIDE IMPROVEMENT” (NEJM, NOV 2, 2006, P.1845)

14 LONG TERM GOAL MOVE FROM “PAY FOR PERFORMANCE” TO “PAY FOR VALUE” VALUE = QUALITY (OUTCOME, SAFETY, SERVICE) COST PER PATIENT OVER TIME (SMOLDT, MAYO CLIN PROC. FEB. 2007, P.210)

15 REFERENCES PAY - FOR - PERFORMANCE (P4P) STUDIES ON EFFECTIVENESS 1. Bradley,E., Hospital quality for acute myocardial iinfarction, JAMA 296(1), July 5, 2006, p Fonarow, G., Association between performance measures and outcomes in heart failure, JAMA 297(1), Jan 3, 2007, p Lindenauer, P., Public reporting and pay for performance in hospital quality improvement, NEJM 356(5), Feb 1, 2007, p Peterson, E., Association between hospital performance and outcomes among patients with acute coronary syndrome, JAMA 295(16), Apr 26, 2006, p Rosenthal, M., Early experience with pay for performance, JAMA 294(14), Oct. 12, 2005, p.1788 Editorial on p Werner, R., Relationship between medicare's hospital compare performance measures and mortality rates, JAMA 296(22), Dec 13, 2006, p GENERAL COMMENTS ON P4P 1. Boyd. C., Clinical practice guidelines and quality of care for older patients with multiple comorbid diseases, JAMA 294(6), Aug , p Chang, J., Patients' global ratings of their health care are not associated with technical quality of care. Ann Int Med 144(9), May 2, 2006, p Fisher, E., Paying for performance -- risks and recommendations, NEJM 355(18), Nov. 2, 2006, p Horn, S., Performance measures and clinical outcomes, JAMA 296(22), Dec. 13, 2006, p Petersen, L., Does pay-for-performance improve the quality of health care? Ann Int Med 145(4), Aug. 15, 2006, p Rosenthal, M., Pay-for-performance, will the latest payment trend improve care? JAMA 297(7), Feb. 21, Rowe, J., Pay-for-performance and accountability: related themes in improving health care, Ann Int Med 145(9), Nov. 7, 2006, p Smoldt, R., Pay-for-performance or Pay-for-value? Mayo Clin Proc. 82(2), Feb. 2007, p.210.