Insurers expected to follow WellPoint’s lead
Other insurers expected to follow WellPoint on tying pay to quality
Less than a month after the CMS completed its value-based purchasing program, WellPoint is leading private payers down that path. The insurer recently announced plans to make its voluntary quality reporting program mandatory, thus tying all payment increases to performance on set measures at every hospital that contracts with its plans. WellPoint estimates the program will reduce the $25 billion it spends annually on inpatient care by 3 to 5 percentage points over time.
And now that WellPoint has jumped in first and made its quality program an across-theboard requirement for new and renewed contracts, expect other insurers to enact similar requirements, said Dr. William Bornstein, chief medical officer and chief quality officer at three-hospital Emory Healthcare in Atlanta.
“Most of us recognize that this is the direction we’re moving toward,” said Bornstein, who also co-chairs WellPoint’s Hospital National Advisory Panel, a 17-member group of hospital leaders and other stakeholders. “Quality measures will be tied to reimbursement.”
The move was hailed by the Leapfrog Group, a healthcare quality improvement organization formed by large employers. “This is exactly what we’ve been hoping health plans will do, which is pay for excellence,” said Leah Binder, Leapfrog’s CEO. “It’s a very bold move.”
But the devil is in the details, Binder warned, and in this case, that means the measures. “We want the standards that WellPoint sets to be tough because hospitals are not performing where they should be,” she said. “They need to pick measures that set a very high bar.”
WellPoint’s quality reporting program, Quality-in-Sights: Hospital Incentive Program, has 504 participating hospitals, according to a spokeswoman. All of the measures, which number 51, are endorsed by organizations such as the National Quality Forum and the Joint Commission, or by professional societies such as the American College of Cardiology.
The company’s new policy would extend Q-HIP to all of the roughly 1,500 hospitals in the 14 markets where WellPoint operates Blue Cross and Blue Shield health plans.
Memorial Health, a 610-bed hospital in Savannah, Ga., has been a participant in Q-HIP since January 2006, and according to Dr. Ramon Meguiar, the hospital’s senior vice president and CMO, the program’s requirements have not been particularly burdensome. “We didn’t really have to do anything extra to participate in Q-HIP because we were already looking at most of the things it measures,” he said.
The hospital, which has taken part in a number of other quality improvement initiatives, including the Institute for Healthcare Improvement’s “100,000 Lives Campaign,” $58.8 billion Indianapolis California, Colorado, Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, New York, Ohio, Virginia, Wisconsin 34 million 1,500 504 has been successful at securing bonus payment increases through the program, he added. This year, Memorial Health scored enough points to qualify for the maximum incentive rate increase of 2.5%.
“It worked well with what we were doing and it gave us a way to get credit for it,” said Chris Pavlo, Memorial Health’s manager of quality improvement.
Q-HIP’s list of measures is divided into three sections: patient safety; process and outcomes measures; and measures of patient satisfaction. Patient safety measures include many of NQF’s Safe Practices, such as pressure ulcer prevention and timely communication about adverse events. Examples of process and outcomes measures include antibiotics before surgery and rates of certain infections.
Hospitals are scored based on their weighted performance on each section. Patient-safety measures are given a weight of 55%, process and outcomes measures determine 35%, and patient satisfaction measures get 10%.
It’s no surprise that private insurers are moving in this direction, said Linda Fishman, senior vice president for public policy analysis and development at the American Hospital Association. But there are a few concerns, too, she said.
First, WellPoint’s measures must be adequately risk-adjusted to account for factors such as age, severity of illness and patients’ socioeconomic status, Fishman said. Those factors will become especially important as the company develops measures for preventable readmissions, she added. Fishman also said hospitals can become overloaded with the proliferation of quality-reporting programs.
Measurement fatigue has been a common topic of discussion at meetings of WellPoint’s Hospital National Advisory Panel, said Dr. Kelvin Baggett, senior vice president and CMO of Tenet Healthcare Corp., Dallas.
“There are so many ways that quality, safety and service are being defined, and you can’t overwhelm those who you’re trying to influence,” said Baggett, who also serves on WellPoint’s panel. “We need some degree of harmonization so we don’t exhaust those who are doing the work.” That’s why the measures being used are common ones, he added.
But the panel and other organizations are grappling with plenty of other issues, said Bornstein, Emory Healthcare’s CMO who co-chairs the panel. Quality measures are still fairly immature and more research is needed to determine which ones work best. And most providers will need a robust electronic health record in place to effectively report on quality, he added.
“It’s a difficult challenge to put up meaningful quality measures that are not excessively burdensome and that adjust for things that are outside of a hospital’s control,” Bornstein said. “There’s still a lot of work to be done, but I think we’re all involved because we have a shared goal of improving quality and reducing costs.”