Presentation on theme: "Academy Health Conference"— Presentation transcript:
1 Academy Health Conference Better Provider Profiling: Adding Patient Risk Adjustment to EpisodesRong Yi, Senior Research Associate, DxCG Inc.Academy Health ConferenceJune 6, 2004
2 Questions Keeping Us Up at Night: The credibility of a provider profiling initiative depends largely on how well we can respond to the ‘my patients are sicker” objection.How much do patient comorbidities affect episode costs?Could we use the DCG Relative Risk Score that measures patient risk along with Medstat’s Episode Group method to more accurately determine expected costs?How do severity and risk-adjusted episodes change our provider profiling results?
3 Presentation Outline Project objectives Proposed methodology Application to BCBS of South Carolina’s provider profilesConclusions
4 MEGs Medstat’s Episodes Grouper Look-backEpisodeClean PeriodLabOfficeVisitPrescriptionHospitalAdmissionOfficeVisitOfficeVisitLinks together a patient’s claims into a clinically meaningful episode across care settingsCalculates summary episode cost and utilization metricsAssigns a managing physician to the episode to support profilingDetermines the disease stage of the episode (highest)
5 Diagnosis Information DxCG’s DCG/HCC ModelsClinical CategoriesDCG ModelDiagnosis InformationAge/SexPatient Risk ScoresDeveloped using regression methods on Medstat’s MarketScan database (commercial model)Model input includes demographic information and all diagnosis information (and/or drug information) for a patient for a period (typically a year)Assigns a set of risk scores to the patient that measures current and future risk (used for adjustment in profiling and predictive modeling).
6 DCG – Calculating a Patient’s Risk Score year old maleCondition Categories5.71 Diabetes with renal manifestation1.84 Congestive heart failure0.90 Acute myocardial infarctionVascular disease with complication0 Vascular disease hierarchy18.09 Dialysis status… ……0.46 Diabetes & congestive heart failureinteraction______29.34 Relative Risk ScoreMember ID: Name: John Smith Age: 54Sex: M Rel Risk Score:
7 How Much Should an Episode Cost? - Depends on the patient! Average Episode CostDCG Risk Score(Health Burden,1.0 = Avg)Whole Patient Cost Next YearRisk-Adjusted Episode Cost45 year old female Healthy$3000.80$1,500??55 year old male Early Chronic2.40$4,50064 year old female Chronic with Complications7.20$12,500
8 Cost of Pneumonia and Patient Risk (DCGs) Stage# of EpisodesEpisode CostAvg DCG Risk Score125103,918$2862.881,345841904389439$171$246$335$378$80782$3502.663414911$56$166$623$368$2,308369$3102.604384$37$118$44$89$4,371Overall4,069$2962.87DCG Risk ScoreHealthier..……………… Sicker
9 Cost of Chronic Diabetes Patient Risk (DCGs) Stage# of EpisodesEpisode CostDCG Risk Score125107,972$3543.012,8561,9001,969962485$132$308$389$536$5272,707$1,1335.32587599776371374$248$562$862$1,815$2,224344$1,6049.621513$28$113$171$1,726$5,111Overall10,723$5563.62DCG Risk ScoreHealthier..……………… Sicker
10 Overall Relationship between Episode Disease Stage and Patient Illness Burden Ordinal Stage# of EpisodesMean PatientRisk ScoreRange409,3171.3(0.1, 56.4)1962,9462.1(0.1, 52.5)273,8663.2310,4915.1Table: mean RRS by disease stages, overall correlation between disease stage and RRS, overall correlation between RRS and cost of episode. (done)Stages are not comparable across MEGs, but broadly higher stages go with higher risk scores.
11 Risk-Adjusted Episodes in Provider Profiling Problem: While episodes can be severity-adjusted, without adjusting for patient risk, there is the potential to unfairly reward physicians who care for patients with few co-morbid diseases and penalize those who effectively care for patients with significant disease burden.Proposed solution: Marry the patient-level risk scores from DxCG with the severity score within Medstat’s Episodes Grouper to fairly evaluate physicians and pay for the best performance.Medstat’sEpisodes GrouperSeverity-adjustmentwithin EpisodeDxCG’s HCC ModelWhole-patientRelative Risk ScoreRisk-adjustedEpisodes
12 Developing the Risk-Adjusted Episode Model MarketScan databaseOnly complete episodes with enough time for claim run-out20 million episodes in 2002Regression models incorporatingMEGDisease StageDCG/HCC Prospective Relative Risk ScorePredict episode cost within each MEGRepresenting roughly 1.5 million enrolled members, privately insured, about 60% in FFS, with diagnostic information from all sites of service, and with prescription drug benefits.
13 Improvements in Predictive Power (R2) R2 measured at individual episode level.
14 Overview of BCBS of South Carolina’s Profiling Efforts 1+ million enrolled membersProvider Contracting deals with over 1600 physiciansProfiling effort began in 1998, using the MEGs.Profile specialists with more than 100 members on episode cost and use information and compare to specialist norms
15 Risk-Adjusted Episode Profile for Internal Medicine / General Practice BASEBASE + DCGManaging PhysEpisodesMean ActualMean ExpPerf RatioPerf Ratio ChangeA1,199$413$4580.90$4390.94-3.90%B1,131$433$5000.87$5070.86-1.10%C1,065$451$502$504-0.30%D633$746$6081.23$5661.329.10%E704$665$4861.37$4771.402.70%F919$495$528$4871.027.80%G835$514$4781.08$4711.091.70%H356$1,091$7571.44$9741.12-32.10%I616$629$6001.05$6321.005.30%
16 Performance Ratios by Physician Performance ratios for most physicians (the ratio of actual $ / expected $) are similar between the two methods.Some physicians performance ratio changes significantly when we add patient risk to the adjustment.Adjusted usingepisode group and stageAdjusted using episodegroup, stage andpatient riskPhysician H moved froman outlier to practicingwithin expected rangePhysician D is evenmore of an outlier
17 Physician D – Drill Down Episode DescriptionEpisodesActual PaymentsExp Payments (BASE)Exp (BASE+DCG)Actual RRSExpected Average RRSOther Nutritional and Metabolic Disorders91$373$260$2641.582.13Essential Hypertension, Chronic Maintenance88$640$6142.002.45Other General Signs, Symptoms, and Conditions47$343$366$3221.642.55Other Ear, Nose, and Throat Infections27$158$148$1411.461.97Osteoarthritis25$2,443$1,462$1,1391.782.82Other Spinal and Back Disorders21$398$505$4301.472.52Other Respiratory Symptoms19$608$776$7171.792.90This physician’s patients have consistently lower illness burden than expected.
18 Physician H Drill DownEpisode DescriptionEpisodesActual Allowed Payments per EpisodeExp Allowed Payments per Episode (MEG)Exp Allowed Payments per Episode (MEG & DCG)Actual RRSExp Average RRSEssential Hypertension, Chronic Maintenance40$729$620$6984.122.42Other Nutritional and Metabolic Disorders29$485$260$2642.042.13Diabetes Mellitus Type 2 and Hyperglycemic States Maint26$1,656$1,360$1,4786.13.7Hernia, Hiatal or Reflux Esophagitis12$880$501$4972.342.39Renal Failure9$13,110$2,992$10,58515.977.01Angina Pectoris$1,180$5,189$4,6223.44.78Physician H moves from an outlier to within the norm due to treating more severely ill patients.
19 ConclusionsEpisode costs increase with the severity of the disease (MEG) and disease burden of the patient (RRS)Considerable variation in episode costs leaves room for risk adjustmentOrganizations can improve the accuracy of provider performance assessments using risk-adjusted episodes. This is important for ensuring equitable pay-for-performance.Plans are underway to incorporate risk-adjusted episodes into the Medstat’s standalone episode grouper and Advantage Suite.