1. Pennsylvania Health Care Cost Containment Council (PHC4) We’re not in Kansas We’re not in Kansas anymore…part 2 anymore…part 2

2. Public Transparency and Accountability: A Threat, or an Opportunity? Marc P. Volavka Executive Director Pennsylvania Health Care Cost Containment Council

3. Pennsylvania Health Care Cost Containment Council (PHC4) What I’ll try and do: Three points: 1) a bit about the history of the Council; 2) a bit about public reporting and transparency; 3) a bit about hospital acquired infections.

4. Pennsylvania Health Care Cost Containment Council (PHC4) About PHC4 Independent state agency established in 1986 Independent state agency established in 1986 Improve the quality and restrain the cost of health care by PUBLICLY releasing data and reports Improve the quality and restrain the cost of health care by PUBLICLY releasing data and reports Promote competition in the health care marketplace Promote competition in the health care marketplace

5. Pennsylvania Health Care Cost Containment Council (PHC4) Sounds a bit like a 1980’s version of “transparency”, doesn’t it?

6. Pennsylvania Health Care Cost Containment Council (PHC4) Council Members Purchasers Purchasers 6 Business 6 Business 6 Labor 6 Labor 1 Consumer 1 Consumer Insurers Insurers 1 Commercial 1 Commercial 1 Non-Profit (Blues) 1 Non-Profit (Blues) 1 HMO 1 HMO Providers Providers 2 Hospital 2 Hospital 2 Physician 2 Physician 1 Nurse 1 Nurse 1 Health Care Quality Improvement Expert 1 Health Care Quality Improvement Expert State Government State Government Secretary of Health Secretary of Health Secretary of Welfare Secretary of Welfare Insurance Commissioner Insurance Commissioner

7. Pennsylvania Health Care Cost Containment Council (PHC4) PHC4 Data Sources: PHC4 Data Sources: 178 Acute Care Hospitals representing about 1.9 million inpatient admissions 178 Acute Care Hospitals representing about 1.9 million inpatient admissions Over 200 Surgery Centers representing about 2.5 million visits Over 200 Surgery Centers representing about 2.5 million visits Third party insurers, including Medicare and Medicaid Third party insurers, including Medicare and Medicaid

8. Pennsylvania Health Care Cost Containment Council (PHC4) What data do we collect? 4 million inpatient hospital discharge 4 million inpatient hospital discharge & ambulatory procedure records/year More than 80 data fields available More than 80 data fields available Hospital Financial and Utilization Data Hospital Financial and Utilization Data Actual payment from 3 rd party payors Actual payment from 3 rd party payors Updated 10/20/03

9. Pennsylvania Health Care Cost Containment Council (PHC4) Public Reports Hospital Performance Report Hospital Performance Report Heart Bypass Report (physician specific) Heart Bypass Report (physician specific) Hospital Financial Report Hospital Financial Report Commercial Managed Care Report Commercial Managed Care Report Medicare Managed Care Report Medicare Managed Care Report Diabetes Hospitalization Report Diabetes Hospitalization Report Hip & Knee replacement (physician specific) Hip & Knee replacement (physician specific) Hospital Acquired Infections Hospital Acquired Infections

10. Pennsylvania Health Care Cost Containment Council (PHC4) Transparency and Consumerism? When the Federal Government speaks, it must be so!

11. Pennsylvania Health Care Cost Containment Council (PHC4) News Release FOR IMMEDIATE RELEASE Thursday, June 1, 2006 Medicare Posts Hospital Payment Information Important Step Toward Transparency in Health Care Costs and Quality To help consumers, providers, and payers make more informed health care decisions, the Department of Health and Human Services through its Centers for Medicare & Medicaid Services (CMS) today posted information on what Medicare pays for 30 common elective procedures and other hospital admissions. President Bush directed the data be made publicly available to all Americans as part of the Administration’s commitment to make health care more affordable and accessible. “Once people gain better information, they become better consumers of health care and that helps get health care costs down and quality of care up,” HHS Secretary “Once people gain better information, they become better consumers of health care and that helps get health care costs down and quality of care up,” HHS Secretary Mike Leavitt said. “The federal government is the biggest single purchaser of health care in America, and by taking steps to post prices and quality data, we hope to encourage more insurance companies, hospitals, clinics and doctors to do the same.”

12. Pennsylvania Health Care Cost Containment Council (PHC4) Question: What does “consumerism” and “transparency” mean in the world of 2006??

13. Pennsylvania Health Care Cost Containment Council (PHC4) Answer: (2 more questions) 1. How much is it gonna cost me? 2. Am I gonna be ok? (and, probably in that order)

14. Pennsylvania Health Care Cost Containment Council (PHC4) And, although I know this will come as a SHOCK to you, the Federal Government wasn’t the first to “discover” transparency, even in pricing!

15. Pennsylvania Health Care Cost Containment Council (PHC4) So, here’s a riddle for your amusement: When does HIPPA prevent a major 3 rd party insurer from providing payment data to PHC4??

16. Pennsylvania Health Care Cost Containment Council (PHC4) Answer: Prior to August 17 th, 2005… When their legal counsel says so!

17. Pennsylvania Health Care Cost Containment Council (PHC4) Now: When does HIPPA ALLOW a major 3 rd party insurer from providing payment data to PHC4??

18. Pennsylvania Health Care Cost Containment Council (PHC4) Answer: After August 18 th, 2005…When their legal counsel says so!

19. Pennsylvania Health Care Cost Containment Council (PHC4) Insurer Reveals What Doctors Really Charge To Help People Compare Fees, Aetna Posts Some Online; A Potential Bargaining Tool By VANESSA FUHRMANS Staff Reporter of THE WALL STREET JOURNAL August 18, 2005 The growing effort to enlist consumers in reducing health-care costs has been stymied by the fact that most people just don't know what medical care costs. Private and government health coverage has helped shield them from bills. And even with newer consumer-driven plans that employ Health Savings Accounts, which give people more of a financial stake in the issue, pricing information can be hard to come by. Now, a major national health insurer is making an effort to change that. Starting tomorrow, Aetna Inc. plans to make available online the exact pricesAetna Starting tomorrow, Aetna Inc. plans to make available online the exact prices it has negotiated with Cincinnati-area doctors for hundreds of medical procedures and tests. The initiative, which Aetna hopes to take eventually to other parts of the country, aims to give patients the tools to comparison shop and make savvier decisions with their health-care dollars.

20. Pennsylvania Health Care Cost Containment Council (PHC4) Notice the date?

21. Pennsylvania Health Care Cost Containment Council (PHC4) In Pennsylvania, with PHC4, we’ve been answering one of the questions (quality) for awhile, and we’re now starting to answer the other one (pricing)…

22. Pennsylvania Health Care Cost Containment Council (PHC4) This is what “transparency” looked like, with our first report on hospital performance, in 1989:

23. Pennsylvania Health Care Cost Containment Council (PHC4)

24. We’ve come a long way since then:

25. Pennsylvania Health Care Cost Containment Council (PHC4)

27. Since 1989, we’ve been demonstrating that you CAN bring some public disclosure to hospital and physician “quality”.

28. Pennsylvania Health Care Cost Containment Council (PHC4) A study to be released today by the Pennsylvania Health Care Cost Containment Council echoes her questions. It found that readmissions at hospitals across the commonwealth rose last year even as death rates declined.

29. Pennsylvania Health Care Cost Containment Council (PHC4) But, does it really matter?

30. Pennsylvania Health Care Cost Containment Council (PHC4) At the same time, the council reported significant improvement in a key quality measure – deaths. Overall, the death rates in Pennsylvania’s hospitals in the categories examined have declined faster than the national average since 1991, the report said. At the same time, the council reported significant improvement in a key quality measure – deaths. Overall, the death rates in Pennsylvania’s hospitals in the categories examined have declined faster than the national average since 1991, the report said.

31. Pennsylvania Health Care Cost Containment Council (PHC4) Here’s what we believe 20 years of “transparency” have contributed to in Pennsylvania:

32. Pennsylvania Health Care Cost Containment Council (PHC4)

33. “Now we face the harder job of making changes in the processes of care at our hospitals to reduce infection rates, complications of care, medical errors and patient readmissions,” said David B. Nash, chairman of the department of health policy at Jefferson Medical College. Despite some limitations to this report, experts said public disclosure of quality paid off. “There is growing evidence that in states with public reporting on health-care quality, mortality is lower and got there faster,” Nash said. Despite some limitations to this report, experts said public disclosure of quality paid off. “There is growing evidence that in states with public reporting on health-care quality, mortality is lower and got there faster,” Nash said.

34. Pennsylvania Health Care Cost Containment Council (PHC4) Now, I’ll fully admit that risk adjusted CABG mortality, or risk adjusted LOS aren’t exactly flowing off the tongues of PA consumers!

35. Pennsylvania Health Care Cost Containment Council (PHC4) But, Hospital acquired infections… Now THAT got peoples attention!

36. Pennsylvania Health Care Cost Containment Council (PHC4)

37. Data Show Scourge of Hospital Infections Alarms raised on hospital infections

38. Pennsylvania Health Care Cost Containment Council (PHC4) That wasn’t so much of a surprise…

39. Pennsylvania Health Care Cost Containment Council (PHC4) But, I also got some interesting Fed Ex packages with “solutions”…

40. Pennsylvania Health Care Cost Containment Council (PHC4) These were a surprise!!

41. Pennsylvania Health Care Cost Containment Council (PHC4) Let me show you what caught the nations attention, when we reported HAI’s on a Statewide basis, in July of 2005:

42. Pennsylvania Health Care Cost Containment Council (PHC4)  11,668 patients were confirmed by PA hospitals as having 4 types of HAI (using CDC guidelines)  1793 died  1510 deaths were above what would have been expected  205,000 extra days in the hospital  $2 BILLION in extra hospital billing that was sent to someone to pay

43. Pennsylvania Health Care Cost Containment Council (PHC4) And, the national media got the two key points:

44. Pennsylvania Health Care Cost Containment Council (PHC4) Hospital-acquired infections are deadly.

45. Pennsylvania Health Care Cost Containment Council (PHC4) For 2004, in PA: 1,000 Patients (Who get an HAI) 130 Die 1,000 Patients (No HAI) 24 Die Additional Deaths104 Additional Deaths Per 1,000 Patients

46. Pennsylvania Health Care Cost Containment Council (PHC4) In other words, if you got an infection in a PA hospital in 2004, the odds of dieing during that hospitalization were 5.41 greater than if you didn’t. I Don’t Like Those Odds!!!!

47. Pennsylvania Health Care Cost Containment Council (PHC4) Second…

48. The costs of hospital- acquired infections are staggering.

49. Pennsylvania Health Care Cost Containment Council (PHC4) In 2004, PA received ACTUAL payment data from our 3 rd party commercial insurers…not charges…PAYMENTS!

50. Pennsylvania Health Care Cost Containment Council (PHC4) We linked hospital confirmed HAI patients with the ACTUAL payments made for each of those patients…

51. Pennsylvania Health Care Cost Containment Council (PHC4) So, we’re going to have a little test here: Let’s see who knows what it actually costs the person PAYING the bill:

52. Pennsylvania Health Care Cost Containment Council (PHC4) In PA, the average PAYMENT for an acute care hospital stay is: $8,078

53. Pennsylvania Health Care Cost Containment Council (PHC4) Ok, so what does the average hospitalization WITH a hospital acquired infection cost?

54. A) $22,247 B) $33,698 C) $48,445 D) $54,807 E) none of the above

55. $60,678 Average PAYMENT!!

56. Pennsylvania Health Care Cost Containment Council (PHC4) …and, that’s JUST the hospital portion…that doesn’t include a penny for the physician payments to treat that patient…

57. Pennsylvania Health Care Cost Containment Council (PHC4) …nor, the ACTUAL costs for the hospital…

58. Pennsylvania Health Care Cost Containment Council (PHC4) Now, what does your average consumer, or payor, think about that?

59. Pennsylvania Health Care Cost Containment Council (PHC4) Stay tuned: Coming to your local theaters on November 14, 2006… 1 st Hospital Acquired Infection Public Report, specific to 170 PA Hospitals

60. Pennsylvania Health Care Cost Containment Council (PHC4) No folks… No folks… We’re not in Kansas anymore…