Spe­cial re­port: Re­form bonuses may ex­ac­er­bate health dis­par­i­ties

Ex­perts see risk of pay­ment re­forms ex­ac­er­bat­ing prob­lems for pa­tients seek­ing care at un­der­per­form­ing hos­pi­tals

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One of the cen­tral themes of the Pa­tient Pro­tec­tion and Af­ford­able Care Act, men­tioned nu­mer­ous times through­out the law, is the press­ing need to elim­i­nate health­care dis­par­i­ties. But some health pol­icy ex­perts worry that pro­vi­sions of the law de­signed to im­prove health­care qual­ity could ex­ac­er­bate gaps in ac­cess and out­comes by pe­nal­iz­ing the hos­pi­tals that mi­nor­ity and poor pa­tients de­pend on the most.

Racial and eth­nic mi­nori­ties tend to seek care at hos­pi­tals that of­ten don’t per­form as well as oth­ers on qual­ity met­rics, says Dr. Anne Beal, chief op­er­at­ing of­fi­cer of the Washington-based Pa­tient-cen­tered Out­comes Re­search In­sti­tute, an in­de­pen­dent, not-for-profit or­ga­ni­za­tion es­tab­lished by the health­care re­form law to pro­mote com­par­a­tive-ef­fec­tive­ness re­search.

That’s not be­cause clin­i­cians at those hos­pi­tals are not in­ter­ested in pro­vid­ing top-notch care, Beal says. Rather, it’s a prob­lem of re­sources, es­pe­cially at in­sti­tu­tions that de­pend heav­ily on Med­i­caid re­im­burse­ment.

“The dif­fer­ences in care that we are see­ing are driven not by who you are but where you go,” she says. “Providers in those set­tings have complicated, high-risk pa­tient pop­u­la­tions that make it much more dif­fi­cult to achieve high lev­els of per­for­mance. There­fore, they’re much less likely to ben­e­fit from pro­grams that re­ward it.”

In a com­men­tary piece in the Oc­to­ber 2011 is­sue of Health Af­fairs— which was ded­i­cated to the topic of health dis­par­i­ties—beal, who was then pres­i­dent of the Aetna Foun­da­tion, praised the health­care re­form law’s re­quire­ment that qual­ity data must be col­lected and strat­i­fied by race and eth­nic­ity. But de­spite the in­creas­ing avail­abil­ity of such data, se­ri­ous chal­lenges will re­main for those in­sti­tu­tions where most low-in­come and mi­nor­ity pa­tients seek care, Beal says.

Low-per­form­ing hos­pi­tals, which are con­cen­trated mainly in the South, care for much higher pro­por­tions of mi­nor­ity pa­tients than do top-per­form­ing hos­pi­tals in the North­east, ac­cord­ing to an­other study that ap­peared in the same is­sue of Health Af­fairs.

The study’s au­thors, led by Dr. Ashish Jha, used a num­ber of sources to gauge hospi­tal qual­ity and costs, in­clud­ing the CMS’ Hospi­tal Com­pare, the Amer­i­can Hospi­tal As­so­ci­a­tion’s an­nual hospi­tal sur­vey from 2007, and the 2008 Hospi­tal Con­sumer As­sess­ment of Health­care Providers and Sys­tems sur­vey.

A to­tal of 122 hos­pi­tals re­ceived a “best” rat­ing, while 178 were rated “worst,” ac­cord­ing to the study. Nearly 15% of dis­charges from the low­est-per­form­ing hos­pi­tals were older black pa­tients. But that same group ac­counted for only 6.8% of pa­tients at the best hos­pi­tals (See chart, p. 27).

The les­son, says Jha, as­so­ci­ate pro­fes­sor of health pol­icy at the Har­vard School of Public Health, Bos­ton, is that the site of care plays a crit­i­cal role in dis­par­i­ties.

“Mi­nori­ties and the poor are much more likely to end up in fa­cil­i­ties that are poor per­form­ing for ev­ery­one,” he says.

Fac­ing fi­nan­cial penal­ties

In the con­text of the CMS’ value-based pur­chas­ing pro­gram, first pro­posed in Jan­uary 2011 and fi­nal­ized in April, those dif­fer­ences in base­line per­for­mance could mean fi­nan­cial penal­ties and even fewer re­sources for al­ready strug­gling hos­pi­tals, Jha says.

The first year of the value-based pur­chas­ing pro­gram ties

hos­pi­tals’ in­cen­tive pay­ments for dis­charges af­ter Oct. 1 to per­for­mance on a set of mea­sures of clin­i­cal pro­cesses of care and pa­tient ex­pe­ri­ence. Funds for the in­cen­tive pay­ments come from a 1% across-the-board cut in base op­er­at­ing DRG pay­ments, ris­ing to 2% by 2017.

Hos­pi­tals can earn points for achieve­ment—based on where an or­ga­ni­za­tion’s per­for­mance on a par­tic­u­lar mea­sure fell within a bench­marked achieve­ment range—or for im­prove­ment. For in­stance, in an ex­am­ple pro­vided by the CMS, a hy­po­thet­i­cal hospi­tal scored 0.91 on a pneu­mo­coc­cal vac­ci­na­tion mea­sure dur­ing the per­for­mance pe­riod. Be­cause the bench­mark for that mea­sure was 0.87, that hospi­tal re­ceived the max­i­mum 10 points for the mea­sure, ac­cord­ing to the CMS.

An­other hy­po­thet­i­cal hospi­tal scored 0.7 on the same mea­sure, earn­ing six points for achieve­ment. But be­cause that hospi­tal’s per­for­mance im­proved sub­stan­tially, from 0.21 to 0.7 dur­ing the per­for­mance pe­riod, the hospi­tal also re­ceived seven im­prove­ment points. The CMS uses the higher of the two scores to de­ter­mine the score for each mea­sure, so the hospi­tal’s final score was seven. The in­di­vid­ual scores are used to cal­cu­late each hospi­tal’s to­tal per­for­mance score, which is then used to de­ter­mine the in­cen­tive pay­ment.

The CMS says the im­prove­ment score keeps the pro­gram from un­fairly pe­nal­iz­ing low per­form­ers.

It was that safe­guard that three CMS of­fi­cials cited in a Jan­uary let­ter in Health Af­fairs, re­spond­ing to the study au­thored by Jha and his col­leagues. The of­fi­cials ar­gued that the high­est-per­form­ing hos­pi­tals and those that showed im­prove­ment could be re­warded equally.

“In fact, the pro­gram will not pe­nal­ize low-per­form­ing hos­pi­tals for fail­ing to meet the bench­mark set by top per­form­ers,” they wrote in the let­ter. “Hos­pi­tals can earn the full in­cen­tive pay­ment by im­prov­ing their per­for­mance rel­a­tive to their own base­line or by at­tain­ing an es­tab­lished bench­mark.”

Also, no hospi­tal would be left “to sink or swim,’ the of­fi­cials wrote, cit­ing as­sis­tance avail­able through Medi­care qual­ity-im­prove­ment or­ga­ni­za­tions and other sources.

In a re­sponse let­ter in the same is­sue of the jour­nal, Jha and his col­leagues ac­knowl­edged that the im­prove­ment score would cre­ate the op­por­tu­nity for low per­form­ers to cap­ture the same pay­ments as high­per­form­ers. But that’s only if those hos­pi­tals at the bot­tom ac­tu­ally im­prove. And with al­ready tight bud­gets and scant re­sources, im­prove­ment is not a cer­tainty, Jha says.

Dr. Mona Fouad, pro­fes­sor and di­rec­tor of the di­vi­sion of pre­ven­tive medicine at the Univer­sity of Alabama at Birm­ing­ham, says the en­vi­ron­ment is chal­leng­ing for physi­cians who strug­gle to pro­vide the ex­tra sup­port and at­ten­tion that high-risk pa­tients need to man­age their health.

“These pa­tients of­ten seek care in the emer­gency room,” says Fouad, also the founder and di­rec­tor of the UAB Mi­nor­ity Health & Health Dis­par­i­ties Re­search Cen­ter. “They get treated, it’s of­ten a one-time thing, and then they dis­ap­pear un­til there is an­other acute is­sue.”

And as pay-for-per­for­mance ini­tia­tives roll out, hos­pi­tals that serve these pop­u­la­tions will be pres­sured to come up with creative ideas to avoid be­ing dinged by penal­ties, she says.

The stakes will be even higher in the sec­ond year of the value-based pur­chas­ing pro­gram, when the CMS be­gins to look at clin­i­cal out­comes through the use of sev­eral in­pa­tient mor­tal­ity mea­sures, says Dr.

Ad­dress­ing read­mis­sions

Karen Joynt, an in­struc­tor in the depart­ment of health pol­icy and man­age­ment, also at the Har­vard School of Public Health.

High-risk pa­tients of­ten come to the hospi­tal sicker, she says, and they have less ac­cess to re­sources out­side the hospi­tal.

“These are gen­er­ally not hos­pi­tals that are op­er­at­ing on big mar­gins, and the pro­gram does run the risk of ex­ac­er­bat­ing dis­par­i­ties,” Joynt says, adding that the CMS’ in­clu­sion of the im­prove­ment score could pro­vide some pro­tec­tion.

There is no such safe­guard for the health­care re­form law’s pre­ventable read­mis­sions penalty, Joynt says.

Be­gin­ning Oct. 1, hos­pi­tals with high read­mis­sion rates for acute my­ocar­dial in­farc­tion, pneu­mo­nia and heart fail­ure over the pre­vi­ous three years will see re­duc­tions in their Medi­care pay­ments up to 1%. That penalty rises to a max­i­mum of 2% of pay­ments in 2013 and 3% in 2015.

In a Fe­bru­ary study in the Jour­nal of the Amer­i­can Med­i­cal As­so­ci­a­tion, Joynt and her col­leagues found that among el­derly Medi­care ben­e­fi­cia­ries, black pa­tients had higher 30-day read­mis­sion rates for all three con­di­tions, a gap that was at­trib­ut­able both to race and to site of care, they said.

Us­ing pre­ventable read­mis­sion rates as a qual­ity met­ric is prob­lem­atic, Joynt says, be­cause it’s not clear that lower read­mis­sion rates trans­late to higher qual­ity.

“Lower read­mis­sion rates could mean a higher mor­tal­ity rate,” she says. “Also, if pa­tients have ac­cess to good-qual­ity out­pa­tient care, the pool of pa­tients that are ad­mit­ted to the hospi­tal will be sicker and more likely to be read­mit­ted. Im­prov­ing over­all qual­ity can ac­tu­ally in­crease hospi­tal read­mis­sion rates.”

En­sur­ing ad­e­quate sup­port and ac­cess to care af­ter dis­charge be­comes much more dif­fi­cult with pa­tients who are tran­siently housed or who don’t speak English or who can’t af­ford med­i­ca­tions, Joynt adds.

“Hos­pi­tals with a large num­ber of those pa­tients have to do a lot more to keep those pa­tients from be­ing read­mit­ted,” she says. “It’s hard to hold them ac­count­able. It’s prob­a­bly a bet­ter mea­sure for a sys­tem or an ac­count­able care or­ga­ni­za­tion.”

Not all pol­icy ex­perts are con­vinced that mi­nor­ity pa­tients re­ceive care

GETTY IMAGES

Re­searchers con­tend the site of pa­tient care plays a crit­i­cal role in the de­gree of dis­par­ity.

Source: Health Af­fairs, Oc­to­ber 2011 MOD­ERN HEALTH­CARE GRAPHIC

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