making leaps in health care suzanne delbanco, ph.d., ceo the leapfrog group
DESCRIPTION
Employer-Based Health Care System in Trouble Rapid escalation in cost (9-20+%/yr) Companies unable to absorb growing medical cost through product price increases Individual companies have limited purchasing power to effect change in systemTRANSCRIPT
The Purchaser’s Perspective
Employer-Based Health Care System
in Trouble• Rapid escalation in cost (9-20+%/yr)
• Companies unable to absorb growing medical cost through product price increases
• Individual companies have limited purchasing power to effect change in system
Gridlock in the Health Care System
Health PlansNot Letting Provider Value Show Through
ProvidersNot Seeing Case for
Reengineering
PurchasersNot Buying Right,
Toxic Payment System
ConsumersNot In the
Quality Game
Everyone Responsible, No One Accountable
New Thinking is Needed to “Leapfrog” the Gridlock
The Impact of Bad Health Care Purchasing
Failures in the Quality and Safety of Care
• Patients receive recommended health care only 55% of the time1
• 30% of all direct health care costs are due to poor care – Misuse, under-use, overuse, and waste2
– Poor quality care costs between $1,900 and $2,250 per covered employee year2
• Poor quality means lives lost and mistakes made– Up to 98,000 deaths/year due to medical mistakes3
1McGlynn et al. 20032Midwest Business Group on Health/Juran Institute 20033Institute of Medicine 1999
The Leapfrog Movement and other Remedies
Inform & Educate
Enrollees
Compare Providers
Rewarding & Creating
Incentives for Quality & Efficiency
Member Support & Activation
The Leapfrog Operating System
Improved Value
Multipliers: Health plan
products
CMS & state purchasers
Other distribution channels &
partners
Pillars for Improving QualityStandard
Measurements & Practices
Transparency Incentives & Rewards
Sec. Leavitt’s Four Cornerstones to Promote Quality and Efficiency
1. Interoperable Health IT
2. Transparency of quality information based on standard measures
3. Transparency of price information
4. Incentives for high quality care
Expands President’s Executive Order calling for federal purchasers (OPM, CMS, DoD) to use
purchasing practices to promote these cornerstones
Standard Measurements & Practices
We must ‘speak the same language’ when asking hospitals & doctors to
report – national standards are essential
Four Safety ‘Leaps’ and Beyond• Four Leaps
1. Computer physician order entry (CPOE)2. Staffing ICUs with intensivists3. Evidence-based hospital referral (EHR) for patients
needing high-risk care to hospitals with the best track record and experience
4. Safety Score of 27 other National Quality Forum (NQF) -endorsed Safe Practices
4. Beyond• “Never events” policy• Leapfrog Hospital Insights
The Dashboard of Information Neededis Still Largely Blank
Hospitals PhysiciansIntegrated Delivery Systems
Treatment Options
Clinical Quality(Safe, Timely,
Effective)
Efficiency
Patient Experience
Equity
Transparency Make reporting quality and cost
measure results routine and use this information to make health care
purchasing decisions
Leapfrog Hospital Quality and Safety Survey
• 2007 Survey launched on March 5
• New additions include aortic valve and bariatric surgeries, never events, and a transparency indicator
• 2376 hospitals targeted in 33 regions
• 1,264 hospitals participating to date (7/31/07)
Leapfrog’s Regional Roll-Outs:Painting the USA Green 2001-2007
Regions drive survey data collection:1. Recognize hospitals
for participation and good performance
2. Use various financial incentives and rewards to drive further improvements
Regional Roll-Outs!(Regions in Green)
9
Survey results posted publicly
Leapfrog Hospital Insights• Helps consumers make informed health care
decisions and purchasers and plans create informed benefit designs, provider networks and reimbursement strategies
• Measures hospital performance on clinical quality and efficiency
• Five clinical areas: – Coronary artery bypass graft (CABG);– Percutaneous coronary intervention (PCI);– Acute myocardial infarction (AMI);– Community acquired pneumonia; and,– Deliveries/newborn care.
Good Progress, but…
• Leapfrog and other reporting efforts are limited in either or both scope and participation
• Rate limiting factors include quality of measures, burden of reporting, voluntary reporting may lead to self-selection, cost and quality are rarely connected
Incentives & RewardsEncourage better quality of care through incentives and rewards
Growing Efforts to Buy Right• Public reporting and recognition
• Financial rewards to providers (200+ programs)– Reliance on process rather than outcomes
measures– Payments are small – 2 to 6%
• Financial incentives for consumers
• CMS and states engaging and can be major force
Leapfrog Hospital Rewards ProgramTM
• Leapfrog Hospital Rewards ProgramTM (LHRP) is based on Leapfrog Hospital Insights measures
• Program Goal is to motivate hospital quality improvement through recognition and rewards
• Self-sustaining as rewards are paid out of savings from improvements
There Is Significant Variance in Hospital Performance
Sample LHRP Quality and Efficiency Performance (AMI)
(2.5)(2.0)(1.5)
(1.0)(0.5)0.00.51.0
1.52.02.5
40% 50% 60% 70% 80% 90% 100%
Quality Score
Effici
ency
Sco
re
The Top Performing Hospitals Show What is AchievableSample LHRP Quality and Efficiency Performance (AMI)
(2.5)(2.0)(1.5)
(1.0)(0.5)0.00.51.0
1.52.02.5
40% 50% 60% 70% 80% 90% 100%
Quality Score
Effici
ency
Sco
re
Top 25% in Quality and Efficiency
Savings Analysis - Results
# hospitals
% of Total
HospitalsAvg
Payment
% of Grand Mean
# hospitals
% of Total
HospitalsAvg
Payment
% of Grand Mean
# hospitals
% of Total
HospitalsAvg
Payment
% of Grand Mean
Cohort 1 9 8.2% $13,631 65% 8 7.5% $24,685 71% 9 4.4% $4,851 76%
Cohort 2 56 50.9% $18,699 90% 55 51.9% $31,626 91% 115 56.1% $5,809 90%
Cohort 3 14 12.7% $23,372 112% 10 9.4% $39,145 113% 31 15.1% $6,723 105%
Cohort 4 31 28.2% $25,700 123% 33 31.1% $41,025 118% 50 24.4% $7,918 123%
110 100.0% $20,852 100% 106 100.0% $34,737 100% 205 100.0% $6,420 100%
# hospitals
% of Total
HospitalsAvg
Payment
% of Grand Mean
# hospitals
% of Total
HospitalsAvg
Payment
% of Grand Mean
Cohort 1 3 2.7% $11,050 73% 17 6.9% $3,071 75%
Cohort 2 72 64.9% $12,438 82% 137 55.7% $3,708 90%
Cohort 3 9 8.1% $17,641 116% 28 11.4% $4,082 99%
Cohort 4 27 24.3% $20,190 133% 64 26.0% $5,048 123%
111 100.0% $15,170 100% 246 100.0% $4,113 100%
1 Cohort 1 "Top Performance" Hospitals are Top Quadrant in Efficiency and Effectiveness
Grand Mean
Grand Mean
PCI Deliveries / Newborn
CAPAMI CABG
AMI
% of hospitals
Average Payment % of Average
Perf. Group 1 8.2% $13,631 65%
Perf. Group 2 50.9% $18,699 90%
Perf. Group 3 12.7% $23,372 112%
Perf. Group 4 28.2% $25,700 123%
Average 100% $20,852 100%
National Opportunity
Admission Type
Potential for Lives Saved
Potential for Avoided Readmissions
Potential for $$ Saved (billions)
AMI 33,832 24,838 $5.596 CABG 4,089 9,246 $3.962
PCI 2,800 15,203 $2.795 CAP 2,673 48,962 $2.039
Newborn Delivery 12,749 46,674 $4.142
TOTAL 63,953 144,923 $18.536
Lives saved total includes 7,810 lives saved from ICU staffing
What’s Next?
Gainsharing Module
• Reward sharing between a hospital and its physicians under a scenario that also benefits purchasers and payers
• Based on quality, not cost as in other programs
• Possibly layered on top of Leapfrog Hospital Rewards Program
•Rate physicians on whether the hospitals to which they most often refer patients meet the relevant Leapfrog standards
•Goal of shifting market share to hospitals meeting standards to drive performance improvement among others
•Requires attention to benefit design and administration
Physicians Referrals
Bridges To Excellence, Proprietary & Confidential Page 30
PROMETHEUS is a new payment model that, if successful, will…
Remove the current barriers to the realization of high levels of professionalism in medicine, restoring autonomy with full public accountability
Significantly improve the coordination of care in a fragmented delivery system, and the quality of care for patients
Reduce unwarranted variation and moderate medical cost inflation
Create true pricing information for all, and a way to measure output
More information: www.prometheuspayment.org
Bridges To Excellence, Proprietary & Confidential Page 31
It has a few important ingredientsPay right, right from the start – It starts with Evidence-informed Case Rates (ECRs) that are adjusted to reflect patient severity. High performers can make more than 100% of the Case Rate – doing well while doing right. Low performers will make less.
Promote clinical integration and accountability across the board, and reward better quality – 10% to 20% of the payment is deposited in a performance contingency fund and tied to provider performance on process and outcomes of care, patient experience of care, and cost-efficiency. Providers are encouraged to be clinically integrated, even virtually, with 30% of their score dependent on the performance of downstream providers.
Promote transparency – ECRs provide real and complete price transparency for consumers and providers, and the scorecard provides full transparency on quality.
Will Incentives and Rewards Work?
• Our current fixes are superficial
• They highlight the need to rebuild the payment system and how we organize care
• Costs are rising – aging population, new drugs and technology may outstrip efficiencies we can create
• The need to shave the trend in health care costs is desperate
Leaping Over the Gridlock
• Growing standardization in measurement, transparency and aligned incentives
• Health care system evolves so slowly, we can see the future now and might as well prepare