Geographic Variation in Healthcare and Promotion of High-Value Care

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• Geographic Variation in Healthcare and Promotion
  of High-Value Care

Margaret E. OKane November 10, 2010
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Overview

• Conceptual framework sources of variation
• Effective care
• Supply sensitive care
• At the health plan level
• At the delivery system level
• Delivery system innovations to drive change
• Preference sensitive care
• Recommendations

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Conceptual framework
Effective care (15) Making health plans and
delivery system accountable, reward
results Supply-sensitive care
(60) Accountability mechanisms at the delivery
system level, use incentives to drive
results Preference-sensitive care (25)
Comparative effectiveness research, shared
decision making and patient activation Source
Wennberg estimates based on Medicare claims
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Effective care
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Variation in the Quality of Care for Diabetes
New England 5.6
East North Central 1.8
Middle Atlantic 0.5
Pacific 1.2
West NorthCentral 1.3
Mountain -0.8
2.5 or more 1.0 to 2.5 Within 1.0 of
mean -1.0 to 2.5 -2.5 or more
South Central -5.3
South Atlantic -1.7
Regional Performance Relative to National
Average Commercial plans, 2009
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Supply sensitive care looking at plans and
delivery systems
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Relative Resource Use (RRU) Measures

• Indicates how intensively a plan uses resources
  (physician visits, hospital stays, etc.) vs.
  similar plans
• With HEDIS quality measures, RRUs let us talk
  about quality and cost together
• This gives purchasers and plans a basis for
  discussing the value plans offer, not merely unit
  price and discount

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Relative Resource Use Total Medical Costs
(excluding Rx) For Patients with DiabetesAll
U.S. Commercial Plans, 2009
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RRUs for Plans Show Wide Variation Within
States Florida
2009 HEDIS Relative Resource Use Composite
Measures for Diabetes
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What Can We Learn From RRU?

• No correlation between quality and resource use
• Tremendous variation within regions among plans
• High quality care can be delivered at either high
  or low resource levels
• Moving to high-quality, low-resource use would
  yield significant savings

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California Integrated Healthcare Association
Pay-for-Performance Looking at the Delivery
System

• Largest P4P program outside UK
• Includes 7 insurers, 12 million commercial HMO
  lives
• Aggregates insurers data to score results
• Significantly increased reliability and physician
  trust

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2008 Variation in California Physician
Organization Performance
.
(1) Lower rates indicate better performance for
HbA1c Poor Control.
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2009 Variation in California Physician
Organization Resource Use
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Californias Integrated Healthcare Association

• Now moving to also reward efficiency
• Inpatient Readmissions within 30 Days
• Inpatient Utilization - Acute Care Discharges
• Inpatient Utilization - Bed Days
• of Outpatient Surgeries Done in ASC
• Emergency Department Visits
• Generic Prescribing
• And performance based contracting
• Standardize utilization metrics and bring under
  the P4P umbrella (Total Cost of Care measure)
• More info _at_ www.iha.org

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Delivery system innovations to drive change
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PCMH Driving Quality and Cost Savings

• 7 medical home demonstrations show
• Reduced hospitalization rates (6-19.2)
• Reduced ER visits (0-29)
• Increased savings per patient (71-640)
• Four common features in demonstrations
• Dedicated care managers
• Expanded access to health
• practitioners
• Data-driven analytic tools
• Use of incentives

Source Fields, et al. 2010
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What is an ACO?

• Goal to meet the triple aim
• Improve peoples experience of care
• Improve population health
• Reduce overall cost of care
• Aligns incentives and rewards providers based on
  the performance (both quality and financial)
• Payment mechanisms such as shared savings or
  partial/full-risk contracts
• Quality measures essential to assure needed care
  provided even with incentives to reduce costs

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Medical Homes ACOs

• Medical Homes are basic building blocks for
  Accountable Care Organizations
• NCQAs ACO Guiding Principles
• a strong primary care foundation that promotes
  the delivery of services consistent with the
  principles of the Patient-Centered Medical Home
• NCQAs draft ACO criteria open for public comment
  until Nov. 19

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Preference sensitive care
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Decision-Making and Patient Engagement

• The engaged patient
• Takes steps to be healthy
• If unhealthy, understands medical condition and
  the therapies, asks questions, open to shared
  decision making
• Prepares for expected events (childbirth,
  hospitalization, e.g. Coleman approach)
• Understands the cost tradeoffs and the health
  tradeoffs
• Policies and plan design can support patient
  engagement

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CONCLUSIONS

• There are high-performing plans and providers in
  low performing regions and vice versa
• Different types of variation require different
  strategies
• Bringing accountability to the delivery system
  level allows plans/payers to take action
• Easier than mobilizing a community
• Shared decision making can help
• Improvement can/should be rewarded

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Recommendations for the Committee to Consider

• PCMH and ACO two key strategies to continue to
  pursue
• but still need to address others who dont
  participate (specialists)
• Networks of PCMH, PCMH neighborhood
• One option is to set quality/resource targets to
  reflect care patterns at the local level and
  rewards/penalties that are meaningful to
  providers
• Tiered networks a good idea worth trying in
  Medicare