Wednesday, 09 September 2015 22:44

The Final Piece of the Healthcare Puzzle – Matching Quality with Price

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Much of recent discussion about value-based payments in healthcare centers on price. And while price is important to all consumers of healthcare services (just as with any other good or service), quality is equally important – maybe even more important. Only providing price information to patients and employers is presenting half the picture.

In addition, there are advantages to hospitals and physicians providing quality data along with price information. As in any other industry, being able to provide and document better quality can result in an ability to charge more for services. So why is quality transparency so far behind price transparency? Well, for one thing, how to define quality and which metrics to use to measure it is still under debate.

Currently there are thousands of measures used in healthcare to measure performance. The Centers for Medicare & Medicaid Services (CMS) quality measures inventory has nearly 1,700 measures, and the National Quality Forum has over 600! By any stretch of the imagination, this is way too many!

However, this seems to be changing as various constituencies evaluate the many measures in use today. One of the groups on the forefront of this issue is the Institute for Medicine (IOM), which recently called for streamlining quality measures and narrowing the industry’s focus to those that matter most and result in better health.

The IOM, with support from the Blue Shield of California Foundation, the California Healthcare Foundation, and the Robert Wood Johnson Foundation, recently convened a committee to identify core measures for health and healthcare,and it published its recommendations in a report called Vital Signs: Core Metrics for Health and Health Care Progress. The framework is based on four fundamental principles: healthy people, care quality, lower cost, and engaged people.

The measures were selected based upon their understandability, their potential to have broad system impact, their technical integrity, and the ability to be used at multiple levels.

The committee came up with 15 key measures in all: life expectancy, well-being, obesity, addictive behavior, unintended pregnancy, healthy communities, preventive services, care access, patient safety, evidence-based care, care matching patient goals, personal spending burden, population spending burden, individual engagement, and community engagement.

Behind each of these core measures are related priority measures.

Life expectancy: infant mortality, maternal mortality, and violence and injury mortality.

Well-being: multiple chronic conditions and depression.

Obesity: activity levels and healthy eating patterns.

Addictive behavior: tobacco use and drug and alcohol dependence.

Unintended pregnancy: contraceptive use.

Healthy communities: childhood poverty rate, childhood asthma, air quality index, and drinking water quality index.

Preventative services: influenza immunization and colorectal cancer and breast cancer screening.

Care access: usual source of care, delay of needed care.

Patient safety: wrong-site surgery, pressure ulcers, and medication reconciliation.

Evidence-based care: cardiovascular risk reduction, hypertension control, diabetes control composite, heart attack therapy protocol, stroke therapy protocol, and unnecessary care composite.

Care matching patient goals: patient experience, shared decision-making, and end-of-life/advanced care planning.

Personal spending: healthcare-related bankruptcies.

Population spending burden: total cost of care, healthcare spending growth.

Individual engagement: involvement in health initiatives.

Community engagement: availability of health food, walkability, and community health benefit agenda.

The committee realized that in order for these measures to be leveraged in a meaningful way, there needed to be buy-in from all involved parties. In order to accomplish this, the committee developed 10 recommendations. The recommendations outline the specific responsibilities of all parties involved in the provision and use of healthcare services, including the government, clinicians, healthcare delivery organizations, employers, payors and purchasers, individuals and families, communities, and accrediting organizations.

The basic goal of the recommendations is to get all parties involved to agree on the core metrics to be measured, the implementation of the measures, and each party’s role in the success of the transition to a value-based system.

The work of the IOM and this committee is a great step forward in moving the industry toward adoption of consistent, quantifiable quality metrics. This, coupled with an increase in price transparency, should result in further progress towards a value-based healthcare system, which will result in better care at lower cost for all our communities.

About the Author

Greg Adams is the chief strategy officer for Panacea Healthcare Solutions and has over 35 years of experience in the field of healthcare, including 20 years’ experience as a hospital CFO. His experience includes financial operations, managed care contracting, physician practice management, patient accounting, patient access, health information management, materials management, and real estate development. Greg is the past chairman of Healthcare Financial Management Association (HFMA), having served as the chair of its Board of Directors in 2011-12. In that role he oversaw the services the organization provides to its 40,000 members. Greg speaks extensively on healthcare reform and the transition to a value-based payment system. His speaking engagements include national, regional, and state programs. He has previously served as a member of the Board of Directors for the Healthcare Financial Management Association from 2002-2005 and as president of the New Jersey chapter in 1997-98. He has also served as a member of the Board of Trustees and as chairman of the Finance Committee at St. Ann’s Home for the Aged in Jersey City, N.J.

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Greg Adams is the Chief Strategy Officer for Panacea Healthcare Solutions and has over 35 years of experience in the field of healthcare including 20 years experience as a hospital CFO. His experience includes financial operations, managed care contracting, physician practice management, patient accounting, patient access, health information management, materials management and real estate development.  Greg is the Past Chair of the National HFMA, having served as the Chair of its Board of Directors in 2011-12. In that role he oversaw the services the organization provides to its 40,000 members. Greg speaks extensively on healthcare reform and the transition to a value based payment system. His speaking engagements include national, regional, and state programs. He has previously served as a member of the National Board of Directors for the Healthcare Financial Management Association from 2002-2005 and as President of the New Jersey chapter in 1997-98. He has also served as a member of the Board of Trustees and Chairman of the Finance Committee at St. Ann’s Home for the Aged, Jersey City, New Jersey.