paying for quality health care: states’ roles march 24, 2011 new hampshire general court ...

Paying for Quality Health Care: States’ Roles

March 24, 2011 New Hampshire General

Court Concord NH Ellen Andrews, PhD Health Policy Consultant www.csgeast.org

Health care spending

Sources: National Health Accounts, CMS, accessed 3/20/11, Fiscal Survey of States, NASBO, Fall 2010

And it’s going to get worse

Sources: National Health Accounts, CMS

State spending


Quality Only 39% of American adults are confident

that they can get safe, effective care when needed

Americans get only 55% of recommended care on average

Half of Americans report poor coordination of care; especially among those who see more than one doctor

One in three Americans reports getting unnecessary care or duplicate tests.

Quality in the region

Sources: S. Jencks, et al, Rehospitalizations among Patients in the Medicare Fee-for-Service Program, New England J Med, 4/2/09, Preventable hospitalizations US $30 billion/yr – AHRQ, National CVE meeting, 7/09

Quality in the region

Sources: 2007 National Survey of Children's Health, http://www.nschdata.org/Content/Default.aspx

If it’s not broken, don’t fix itWell, it’s broken


Current incentives Pay the same for unequal quality services Consumers have no information and no

incentive to choose higher quality/higher efficiency service providers

Encourages overuse, misuse of services Higher spending not correlated with higher

quality Higher spending not correlated with better

patient satisfaction

Fee-for-service misaligned incentivesFee for service encourages:

More services Less coordination Incentives for duplication Few incentives for prevention Stifles innovation Only pays for selected services - not email, group

visits, phone calls No link to quality Incentives to increase high profit services/patients

and avoid low profit

Value-based purchasing Rewards better outcomes Payments based on quality and efficiency of

care Data driven Remove incentives for more services Flexibility for providers to customize care Reward patient satisfaction Remove fragmentation and conflicting

incentives Align provider, payer and consumer incentives

to reward quality, effectiveness and efficiency

Consumers support value-based purchasing 95% of Americans feel it is important to have

information about the quality of care provided by different doctors and hospitals

88% feel it is important that they have information about the costs of care to them before they actually get care

Federal VBP Strong feature in national reform

Innovation Center, waivers ACOs Comparative effectiveness research Medicare and Medicaid bundled payment pilots

Medicare 23 programs – P4P, pay for reporting, never events,

medical home, gain sharing, removing regulatory barriers, e-prescribing, data aggregation

Premiere Demonstration – hospital P4P Physician Group Demonstration Implementing differential payments based on

readmission rates

Why should states implement VBP? State employee groups usually one of largest

groups in state – 42 states self-insure Medicaid programs – covers one in five

Americans States regulate insurers, license providers, CON Trusted source for consumer education, data

collection, research Public health collaborations Innovators – medical home, HIT, coverage

programs Provider training – promote primary care,

emphasis on accountability, transparency Convener – can get people to the table, anti-

trust protections

Options: Transparency Data reporting Report cards – hospitals, health plans,

providers Coalitions with other payers, providers for

joint reporting All payer data aggregation State employee, Medicaid reporting Improve consumer access to information

Options: P4P Widespread, but mixed results Medicaid P4P in 28 states and growing Federal Medicaid limits on incentive payments

in risk-based systems Target health plans and/or providers Coordinate and join with other payers to make

payments salient to providers Outcomes vs. process and teaching to the

test/cookbooks Provider resistance, low Medicaid participation

rates

Options: Payment system overhaul Never events Market share – tier and steer Shared savings Episodes of care, bundled payments Global capitation Resistance Barriers

Supportive options Medical home Accountable care organizations EMRs, health information exchange Workforce development, esp primary care Evidence based medicine

Maine value-based purchasing State employee plan leadership in larger multi-payer

collaborative – Maine Health Management Coalition 2005 adopted strategy to encourage consumers to

make informed choices, incentives to access higher quality care, reward high quality providers

Hospital and physician tiering by quality, expanded program over the years

Messaging to members, web-based, became a trusted source of information

Engaged providers in development of standards, QI plans

First year diabetes disease management participants averaged $1300 less in health care costs

Transitioning from FFS to bundled payments

Lessons from others Collaborate first Go slowly Start small and with strongest partners Coordinate across payers -- standardize Fair and open process Everyone on same page, all have same understanding Be clear on goals, single-minded dedication Strong consumer education piece necessary Plan for transitions Don’t underestimate the power of disclosure and

transparency, often stronger motivator than $$$ Be brave The time is right for transforming delivery and payment

systems – the status quo is not sustainable

For more information –[email protected]

paying for quality health care: states’ roles march 24, 2011 new hampshire general court ...

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