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Report Cards, P4P, EMRs, and Disease Management


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Title: Report Cards, P4P, EMRs, and Disease Management

Report Cards, P4P, EMRs, and Disease Management
  • An Analysis of Managed Care 2.0

The debate about quality has been corrupted in
two ways
  • Quality problems have been exaggerated this is
    usually accomplished by confusing inferior
    quality with access barriers.
  • Discussion of QI has been limited to those
    activities which plans can conduct (e.g.,
    financial incentives, report cards). QI which
    leaves out plans (e.g., public health, ending the
    nurse shortage) gets less attention.

Example of exaggeration of the quality problem
  • Extensive research has documented that all
    three forms of clinical quality problems
    underuse, overuse, and misuse are ubiquitous in
    American medicine. (p. 166).
  • Elise C. Becher and Mark R. Chassin, Improving
    the quality of health care Who will lead?
    Health Affairs 200120(5)164-179, 166.

Becher and Chassin offered this proof of
ubiquitous inferior quality
  • A 1998 Rand literature review finding 30-40
    underuse and 20-30 overuse, and malpractice
    studies finding, 1 misuse.
  • But a far more extensive Rand study (2003) found
    46 underuse and 11 overuse.
  • Overuse and misuse obviously involve provider
    error. But underuse may not.

Rand reported 46 underuse and 11 overuse
  • But Rand made no attempt to determine what
    caused underuse and overuse.
  • Examples of Rand findings for diabetics
  • 24 had A1c measured every six months
  • 14 had annual eye exam
  • 23 had urine protein checked annually
  • 56 received dietary and exercise counseling
  • 45 had follow-up visit every six months.

Researchers ignored underuse until late 1990s
  • Most health services research to date has been
    directed at identifying and reducing excessive
    utilization. Little attention has been given to
    underuse of care.
  • Two scholars at the RAND Corporation (R. L.
    Kravitz and M. Laouri, Measuring and averting
    underuse of necessary cardiac procedures A
    summary of results and future directions, Joint
    Commission Journal on Quality Improvement

Example of misuse of the 2003 Rand study
(conflating quality and access)
  • Despite the extensive investment in
    developing clinical guidelines, most clinicians
    do not routinely integrate them into their
    practices. In a recent study of US adults,
    Elizabeth McGlynn and colleagues found that more
    than half did not receive the recommended
  • Dan Mendelson and Tanisha V. Carino,
    Evidence-based medicine in the United States De
    rigueur or dream deferred? Health Affairs
    200524133-136, 134.

Another example of the misuse of the Rand study
  • Research has shown that physicians incorporate
    the latest medical evidence into their treatment
    decisions 50 percent of the time (McGlynn et al,
  • US Department of Health and Human Services,
    Office of National Coordinator for Health
    Information Technology, The Decade of Health
    Information Technology Delivering
    Consumer-Centric and Information-Rich Health
    Care, July 21, 2004, 3.

Another example of misuse of the Rand study
  • Physicians deliver recommended care only about
    half of the time. (citing McGlynn et al.)
  • Richard Hillestad et al., Can electronic
    medical record systems transform health care?
    Potential health benefits, savings, and costs,
    Health Affairs 2005241103, 1110.
  • This article, also by Rand scholars, was funded
    by the computer industry hailing the benefits of

Rand facilitated misunderstanding our results
need no risk adjustment
  • We primarily chose measures of processes as
    indicators, because they represent the activities
    that clinicians control most directly, and
    because they do not generally require risk
  • Elizabeth McGlynn et al., The quality of
    health care delivered to adults in the United
    States, New England Journal of Medicine
    20033482635-45, 37.

Outcome and process measures
  • Outcome measures reflect changes in patient
    health. Examples mortality rates after surgery,
    cholesterol level, and ability to carry out
    activities of daily living.
  • Process measures reflect how well providers
    comply with standards of care. Examples percent
    of children vaccinated, and percent of diabetics
    given eye exams.

Underuse is affected by factors outside physician
  • No health insurance or insurance with pre-ex
    exclusions or out-of-pocket payments
  • Other barriers (patient values, low income,
    illiteracy, immobility, transportation, daycare,
    change in residence or insurance).

Evidence that health insurance affects underuse
by diabetics
  • Athough an estimated 35 percent of those with
    health coverage had received a blood glucose
    test, a cholesterol test, eye exam, foot exam,
    and influenza vaccination, just 14 percent of
    those without health coverage received the same
    set of services.
  • US GAO, Managing Diabetes Health Plan Coverage
    of Services and Supplies, February 2005, 19.

Evidence that patient behavior affects process
  • Three-fifths of elderly Medicare beneficiaries
    who receive an appropriate recommendation for
    cholecystectomy fail to have it done
  • half of insured patients who should, according to
    a stress test, have an angiogram do not get it
  • a fourth of insured patients who, according to
    their angiogram, should have angioplasty or
    bypass surgery receive neither.
  • Sources SM Asch et al., Measuring underuse of
    necessary care among elderly Medicare
    beneficiaries using inpatient and outpatient
    claims, JAMA 20002842325-2333 (cholecystectomy
    bullet) PP Garg et al., Understanding
    individual and small area variation in the
    underuse of coronary angiography following acute
    myocardial infarction, Med Care 200240614-626,
    and M Laouri et al., Underuse of coronary
    angiography Application of a clinical method,
    Int J Qual Health Care 1997915-22 (angiogram
    bullet) LL Leape et al., Underuse of cardiac
    procedures Do women, ethnic minorities, and the
    uninsured fail to receive needed
    revascularization? Ann Internal Med
    1999130231-233, and M Laouri et al., Underuse
    of coronary revascularization procedures
    Application of a clinical method, J Am Coll
    Cardiol 199729891-897.

Patient refusal has been documented in studies of
  • warfarin for atrial fibrillation,
  • aspirin for heart attack,
  • hypertension medication,
  • vaccines for influenza and pneumonia,
  • blood glucose tests,
  • colorectal cancer screens, and
  • radiation therapy for cancer.
  • Sources SD Weisbord et al., Is warfarin really
    underused in patients with atrial fibrillation?
    J Gen Intern Med 200116743-749 J ONeil, A
    small step for womens hearts, New York Times,
    February 22, 2005, D6 BS Bloom, Continuation of
    initial antihypertensive medication after one
    year of therapy, Clin Ther 199820671-681 PR
    Dexter et al., Inpatient computer-based standing
    orders vs physician reminders to increase
    influenza and pneumococcal vaccination rates A
    randomized trial, JAMA 20042366-2371 VS
    Elliott VS, Researchers call for more diabetes
    testing, American Medical News, September 22/29,
    2003, 19 LC Walter et al., Pitfalls of
    converting practice guidelines into quality
    measures Lessons learned from a VA performance
    measure, JAMA 20042912466-2470 N Bickel et
    al., The quality of early-stage breast cancer
    care, Ann Surg 2000220-224..

(Patient refusal cont.)
  • Patient refusal accounted for 59 percent of the
    underuse of colorectal cancer screens among
    Veterans Affairs patients.
  • At a 2005 meeting of the American Heart
    Association, investigators reported on a study
    which found that doctors recommended aspirin on a
    daily basis to about 95 percent of women who had
    suffered heart attacks and stroke, but that only
    54 percent of the heart-attack patients and 43
    percent of the stroke patients complied with the
  • Sources Walter et al., op cit.(colorectal
    bullet) ONeil, op cit. (aspirin bullet)

Thus, current research permits us to say
  • Overuse occurs 11 of the time and
  • Misuse (malpractice) occurs lt1 of the time.
  • Underuse due to provider failure occurs some
    unknown percent of the time.
  • These figures reveal serious problems, but they
    do not add up to ubiquitous.

Exaggerating the problem of inferior providers
serves insurance industry
  • Insurance industry has used the picture of inept
    providers to promote managed care.
  • QI that does not assume inept providers and/or
    which insurance companies cannot do that is,
    which does not fall under the rubric of managed
    care gets much less attention.

Managed care is not the only way to improve
  • Other methods with more substantial evidence to
    support them include
  • Ending the nurse shortage
  • ending waiting times for emergency services
  • insuring the uninsured and under-insured
  • conducting public education campaigns re
    appropriate medical care and the effects of
    unhealthy behavior
  • rolling back the excesses of managed care
  • measuring and sharing performance results
    privately with providers
  • conducting controlled trials and other forms of
    traditional research to find new treatments and
    to evaluate the efficacy of existing treatments.

Managed care has gone through two stages
  • Managed Care 1.0 relied on
  • financial incentives (capitation and bonuses),
  • utilization review and drug formularies.
  • Managed Care 2.0 relies on
  • report cards, which facilitate P4P, and
  • disease management.

Definition of terms
  • Report cards Any document purporting to measure
    the quality of care given by particular providers
    which is used to reward or punish providers.
  • Pay for performance Any method of paying
    providers based on grades on report cards.

(Definitions cont.)
  • Report card advocates propose that providers be
    rewarded and punished by
  • market forces (plans, employers, and patients
    avoid low-scoring providers and patronize
    high-scoring providers), and/or
  • pay for performance (insurers pay low
    scorers less, high scorers more).

DMAAs definition of DM
  • Activities conducted by third parties that
  • Identify people with certain diseases by
    examining their medical records or claims
  • Rely on evidence-based practice guidelines
  • Educate patients (may include surveillance)
  • Measure processes and outcomes and report the
    results to patients and providers.
  • Source Disease Management Association of
    America http//,
    accessed February 9, 2006.

Another definition of DM
  • Disease management is the latest catchphrase
    in the ever-evolving American health care
    spectacle. Disease management is a
    systematic, population-based approach to identify
    persons at risk, intervene with specific programs
    of care, and measure clinical and other
  • Thomas Bodenheimer, Disease management
    Promises and pitfalls, New Eng J Med
    19993401202-1205, 1202.

Report cards are now advocated simultaneously
  • Interoperable electronic medical records (EMRs)
    (aka, regional and national health information
    networks) and
  • Pay-for-performance methods of reimbursement in
    order to reward high scorers and punish low

Interoperable EMRs are advocated in order
  • To facilitate collection of medical records on
    all Minnesotans/Americans all the time, and
  • To risk adjust scores on report cards.
  • Risk adjustment refers to the process of
    adjusting scores on report cards to reflect
    differences in patient health and other factors
    outside of provider control.

In sum, Managed Care 2.0 means
  • (1) Report cards, which require
  • interoperable EMRs and
  • pay-for-performance methods of reimbursement and
  • (2) Disease management.

Managed Care 2.0 appeared in the wake of the
failure of MC 1.0
  • Events of the past year demonstrate beyond a
    doubt that managed care has failed and failed
    dismally. The greatest single ethical crisis
    facing American health care as we move into new
    year is what to do about it.
  • Art Caplan, director of the Center for
    Bioethics at the University of Pennsylvania ("In
    2001, managed care our No. 1 health crisis,"
    MSNBC, December 21, 2001 http//
    /671464.asp, accessed December 23, 2001).

(Failure of MC 1.0 cont.)
  • Managed care is basically over. People hate it,
    and it's no longer controlling costs. Health-care
    inflation is now back in the double digits. So if
    it's not saving money, then why should we have
    it? But like an unembalmed corpse decomposing,
    dismantling managed care is going to be very
    messy and very smelly, and take awhile.
  • George Lundberg, former editor of JAMA who as
    recently as 1996 had co-authored an article
    defending managed care (Linda Marsa, Former JAMA
    editor laments the state of medical care, Los
    Angeles Times, March 26, 2001, http//www.latimes.
    com/print/health/200103 26/t000026016.html,
    accessed March 28, 2001).

MUHCCs position on report cards and
  • Quality Report cards and P4P have not been shown
    to improve quality, and some research indicates
    they harm patients.
  • Cost Report cards and P4P have not been shown to
    save money, and may raise costs.
  • Small-scale report card and P4P experiments
    should be conducted report cards P4P should not
    implemented on a wide scale.

MUHCCs position on EMRs
  • Quality EMRs may enhance quality in some clinics
    and hospitals. Evidence does not support the
    claim that making EMRs interoperable will improve
  • Cost Evidence does not support the claim that
    EMRs, with or without interoperability, will
    reduce cost.
  • Providers should not be required by government,
    or given financial incentives financed by taxes,
    to buy EMR hardware and software.

MUHCCs position on disease management
  • Quality DM has been shown to improve quality.
  • Cost The evidence does not warrant the claim
    that DM will save money.
  • Because DM can improve quality, research on
    effective means of DM should continue, and
    effective DM programs should be covered by
    insurance or delivered through public health

Report cards
  • The following slides examine the claims made for
    report cards, pay-for-performance, and electronic
    medical records.

Governor claims report cards will improve
quality, reduce costs
  • Rewarding providers for improved health
    outcomes and encouraging patients to use the best
    providers will not only help contain costs, it
    will improve the quality of care, Pawlenty
    said. (Governor Pawlenty unveils Smart Buy
    Alliance to slow health care costs and improve
    quality, press release, November 29, 2004,
    http//, accessed
    November 30, 2004).

The Legislature claims report cards improve
quality, cut costs
  • Minnesota Statutes Sec. 62J.43, signed by
    Governor Pawlenty on May 29, 2004, says
  • To improve quality and reduce health care
    costs, state agencies shall encourage the
    adoption of best practice guidelines. The
    commissioner of health shall facilitate access to
    quality of care measurement information to
    providers, purchasers, and consumers by
    disseminating information on adherence to best
    practices care by physicians and other health
    care providers.

Governor-Legislature claims rely on three
  • (1) Report cards improve quality more often than
    they damage quality
  • (2) Quality improvements inevitably lead to cost
  • (3) The cost reductions achieved by report cards
    will outweigh the cost of producing report cards.

There is little evidence that report cards
improve quality
  • Despite extensive adoption of quality
    measurement and reporting, little research
    examines the effect of public reporting on the
    delivery of health care, and even less examines
    how report cards may improve care. The
    potential negative consequences of public
    reporting are largely unexplored.
  • Rachel M. Werner and David A. Asch, The
    unintended consequences of publicly reporting
    quality information, JAMA 20052931239-44, 39.

Report cards could damage quality three ways
  • (1) By being inaccurate (steering patients to
    inferior doctors)
  • (2) By inducing doctors to reject sicker
  • (3) By inducing doctors to shift resources from
    unmeasured to measured patients.

Report cards can be accurate for some things,
e.g., vacuum cleaners
  • Consumer Reports report card on vacuum
  • Offers grades on 38 vacuum cleaners on a
    five-point scale (from excellent to poor).
  • 3 quality measures
  • - cleaning (carpet, bare floors, w/ tools)
  • - other results (ease of use, noise, emissions)
  • - features (bag, brush, manual pile adj,
  • Kenmore (Sears) got 79 points, Sanyo Performax
    and Panasonic Fold NGo got 53

But patients are not floors, and doctors are not
vacuum cleaners
  • Comparisons of quality are not useful if the
    playing field is not level, that is, if the
    conditions under which quality is measured are
    not the same.
  • Keeping the playing field level is much easier to
    do while measuring the quality of vacuum cleaners
    than it is while measuring doctors and hospitals.

Many factors outside provider control influence
health outcomes
  • Factors that influence health outcomes that are
    outside of provider control include
  • Patient health status prior to treatment
  • Patient insurance status (presence of
    deductibles and co-pays no coverage for service
    being measured no coverage at all)
  • Patient income, education and values.

Failure to measure health status affects scores
  • The next slide illustrates how scores on
    hospitals can be distorted when differences in
    patient health are measured only crudely. It
    shows that when stage of illness at admission
    was ignored, 18 of 65 hospital units scored above
    or below average, but when it was factored in,
    only 6 scored above or below average.

Hospital mortality rates vary depending on stage
of illness
  • Hospital mortality rates for 13 hospitals and
    five conditions under HCFA and Green-Wintfeld
  • Actual Mortality Rate HCFA Model Green-Wintfeld
  • Above expected range 8 2
  • Within expected range 47 59
  • Below expected range 10 4
  • Total 65 65
  • Low-risk heart disease, severe acute heart
    disease, cancer, stroke, and pulmonary disease
  • HCFA adjusted mortality rates for only a few
    of the factors that could have affected patient
    mortality that were outside hospital control
    (risk adjustment included age, sex, diagnoses
    other than the principal diagnosis, number of
    hospitalizations in the past 12 months, referral
    source (physician or nursing home), and urgency
    of admission (emergent, urgent, or elective)).
    Green-Wintfeld added to the HCFA adjusters an
    adjustment for stage of principal diagnosis at

Income affects preventive services for insured
  • Lower SES socioeconomic status patients had
    lower compliance with Pap smears, mammograms, and
    diabetic eye exams, and were less likely to have
    a referral or make any office visit. These
    income effects are not confined to the poorest
    patients but span the entire socioeconomic
  • Peter Franks et al., Effects of patients and
    physician practice socioeconomic status on the
    health care of privately insured managed care
    patients, Medical Care 200341842-852, 842
  • Patients were all insured by the same plan,
    described as the largest local managed care
    organization in the ten-county area surrounding
    Rochester, New York.

Quality-of-care scores for diabetics vary
depending on measure of quality
  • (1) LDL cholesterol under 130 73
  • (2) Measure (1) doctor has responded to high
  • reading, patient has contraindications to
    statins 87
  • (3) Measures (1) (2) other factors 90
  • Other factors included patient refuses to
    take lipid-lowering medications lipid management
    low priority or difficult to address no primary
    care visit after high reading has active care
    elsewhere other interventions tried within six
    months of high reading (diet, exercise, or other
    lipid-lowering drug).
  • Source Eve Kerr et al., Building a better
    quality measure Are some patients with poor
    quality actually getting good care? Medical
    Care 2003411173-1182.

Experts say risk adjustment of report card grades
is essential
  • The interpretation of medical outcomes is
    further complicated by the need to make
    adjustments for comorbidity and the intensity and
    state of the patients illness a far from
    trivial undertaking. Paul Ellwood (Outcomes
    management A technology of patient experience,
    New England Journal of Medicine19883181549-1556)
  • The importance of co-morbidity must be
    stressed.... If co-morbidity is not considered,
    there will always be the potential for individual
    providers to be unjustly accused of poor
    quality because of patient selection. Richard
    W. Asinger, MD (Constructive use of clinical
    databases, The Medical Journal of Allina,
    1996(1)31-34, 32).

(Experts say risk adjustment is essential, cont.)
  • Case-mix adjustments are made in almost all
    profile analyses to account for the differences
    in provider performance attributable solely to
    differences in the populations served (p. 764).
    Risk adjustments contribute vitally to reducing
    unfair profile evaluations (p. 765). Cindy L.
    Christiansen and Carl N. Morris, Improving the
    statistical approach to health care provider
    profiling, Ann Intern Med 1997127764-768.
  • Accurate risk adjustment is necessary for
    observational and health services research,
    including comparison of outcomes of different
    treatments and quality assessment. Jay F.
    Piccirillo et al., Prognostic importance of
    comorbidity in a hospital-based cancer registry,
    JAMA 200429124241-47.

(Experts say risk adjustment is essential, cont.)
  • We found that patient characteristics were
    315 times more important than hospital
    characteristics in predicting mortality after
    simple surgery, so small errors in risk
    adjustment may loom large compared to hospital
  • Jeffrey H. Silver and Paul R. Rosenbaum, A
    spurious correlation between hospital mortality
    and complication rates The importance of
    severity adjustment, Medical Care
    199735OS77-OS92, Supplement, OS87.

Unadjusted report cards damage access for sicker
  • Performance-based contracting gave providers of
    substance abuse treatment financial incentives to
    treat less severe OSA Office of Substance Abuse
    clients in order to improve their performance
    outcomes. Fewer OSA clients with the greatest
    severity were treated in outpatient programs with
    the implementation of PBC performance-based
  • Yujing Shen, Selection incentives in a
    performance-based contracting system, Health
    Services Research 200338535-552, 535.

Even risk-adjusted report cards can damage access
for sicker diabetics
  • We found that if those physicians with the
    worst profiles . . . for 1991 managed to
    discourage the patients with the top 5 of HbA1c
    levels (representing only 1-3 patients per
    physician) from returning to their panel, they
    would in most cases achieve a panel HbA1c profile
    in 1992 that would be substantially improved than
    average. . . . . Thus, the patients HbA1c levels
    from the previous year proved a far better
    predictor of what a patients HbA1c level would
    be in the current year, better than . . . our
    case-mix adjusters. Manipulating their patient
    pool, based on a patients prior year HbA1c
    level, is the easiest way for physicians to have
    a substantial improvement in their profile
  • Timothy P. Hofer et al., The unreliability of
    individual physician report cards for assessing
    the costs and quality of chronic disease, JAMA,
    19992812098-2105, 2103 emphasis added.

New Yorks heart surgery report card
  • First physician-specific report card
  • Grades performance of hospitals and surgeons on
    heart surgery using 30-day mortality as quality
  • Considered most accurate report card in America
  • Has been more carefully examined that any other
    report card

New York heart surgery report card is the gold
  • New York States measurement and publication of
    coronary artery bypass graft (CABG) surgery
    mortality rates has emerged as a model in the
    campaign for useful performance data. The
    reality is that these measures of performance are
    the best available, and that substantial
    improvements are not likely for some years.
  • Stephen F. Jencks, Clinical performance
    measurement -- a hard sell, JAMA
    20002832015-2016, 2015, 2016.

NY heart surgery report card is rigorously
  • 72 risk factors are adjusted
  • They include
  • number of coronary arteries occluded and degree
    of occlusion
  • previous heart attack
  • hemodynamic state just prior to surgery (ability
    to maintain blood pressure)
  • chronic obstructive pulmonary disease
  • kidney failure
  • smoking history (last two weeks, last year)

NY report card is expensive
  • The New York Department of Health pays for
  • five full-time equivalent staff maintaining the
    database... and
  • a utilization review agent to audit a sample
    of 50 cases from half the hospitals each year.
  • The three dozen heart surgery hospitals in NY pay
  • data coordinators to collect and maintain their
    databases most hospitals have a full-time
    coordinator dedicated to this task.
  • Source Edward L. Hannan et al., Public release
    of cardiac surgery outcomes data in New York
    What do New York state cardiologists think of
    it? Am Heart J 199713455-61, 62)

Results of 1998-2000 NY report card on 34 CABG
  • Statewide 30-day mortality average 2.32
  • Three hospitals had higher-than-expected rates
  • Two hospitals had lower-than-expected rates
  • 29 hospitals had expected rates
  • Source New York Department of Health, Adult
    Cardiac Surgery in New York State, 1998-2000,
    98_2000) cabg.pdf, accessed January 16, 2005.

Results of 2000-2002 NY report card on 36 CABG
  • Statewide 30-day mortality average 2.27
  • Three hospitals had higher-than-expected rates
  • Three hospitals had lower-than-expected rates
  • 30 hospitals had expected rates
  • Source New York Department of Health, Adult
    Cardiac Surgery in New York State,2000-2002.

Outliers on 1998-2000 and 2000-2002 NY hospital
CABG reports
  • 1998-2000 2000-2002
  • High mortality rates
  • Albany Med Ctr (4.08) Buffalo General (4.67)
  • Ellis Hosp (6.13) Mount Sinai (4.86)
  • Mount Sinai (6.01) NY Hospitals Ctr (4.31)
  • Low mortality rates
  • Lenox Hill (1.15) St. Josephs (0.90)
  • Winthrop U Hosp (1.10) Staten Island (0.82)
  • Vassar Brothers (0.00)

Rates for 1998-2000 NY hospital outliers two
years later
  • 1998-2000 2000-2002
  • Albany Med Ctr 4.08 2.83
  • Ellis Hosp 6.13 3.29
  • Mount Sinai 6.01 4.86
  • Lenox Hill 1.15 2.02
  • Winthrop U Hosp 1.10 2.78

Change in outlier status among 156
surgeons,1998-2000 to 2000-2002 report
  • 156 surgeons met criteria for grading in
    1998-2000 report 21 (13) were outliers
  • 14 had higher-than-expected mortality rates
  • 7 had lower-than-expected mortality rates
  • All 21 outliers were graded in 2000-2002 report,
    but in that period only 6 of these 21 were
  • Criteria were either 200 operations during
    this period, or at least one operation in each of
    1998, 1999, and 2000.
  • Source Calculations by Kip Sullivan based on
    data in New York Department of Health, Adult
    Cardiac Surgery in New York State, 1998-2000,
    98_2000) cabg.pdf, accessed January 16, 2005.

Study suggested New York report card improves
  • Odds of death from CABG surgery in
  • NY relative to rest of US, 1994-1999 0.67
  • Source Edward L. Hannan et al., Provider
    profiling and quality improvement efforts in
    coronary artery bypass graft surgery, Medical
    Care 2003411164-1172, Table 4, 1170 (subjects
    were Medicare beneficiaries risk adjustment was
    done with 12 adjusters from administrative data)

But the study in the preceding slide was poorly
  • The study in the preceding slide is not
    credible because it examined mortality rates only
    among New Yorkers who underwent CABG surgery. The
    study did not attempt to determine if NY surgeons
    were refusing to perform surgery on sicker heart
    patients. The next several slides indicate that
    is what happened.

Recent studies find NY report card damages health
  • Our results show that report cards on heart
    surgeons led to increased expenditures for both
    healthy and sick patients, marginal health
    benefits for healthy patients, and major adverse
    health consequences for sicker patients. Thus, we
    conclude that report cards reduced our measure of
    welfare over the time period of our study (p.
    577). More severely ill patients experienced
    dramatically worsened health outcomes (p. 583).
    David Dranove et al., Is more information
    better? The effects of report cards on health
    care providers, Journal of Political Economy

Reason NY report card induces surgeons to reject
sicker patients
  • Mandatory reporting mechanisms inevitably
    give providers the incentive to decline to treat
    more difficult and complicated patients (p.
    581). Report cards led to a decline in the
    illness severity of patients receiving CABG in
    New York relative to patients in states without
    report cards (p. 583).
  • David Dranove et al., Is more information
    better? The effects of report cards on health
    care providers, Journal of Political Economy

(NY report card induces surgeons to reject sicker
patients, cont.)
  • The December 19, 1991 Newsday article stated
    that several NY surgeons warned that some
    surgeons were turning down difficult cases to
    protect their statistics (p. 410). An article
    appeared in the New York Times entitled Faint
    hearts. As fate would have it, a woman was
    turned down for surgery because she had a fresh,
    large myocardial infarction. Her daughter was a
    reporter for the New York Times. After great
    difficulty, the daughter eventually found a
    surgeon who would operate on her mother (p.
  • Bradley J. Harlan, Statewide reporting of
    coronary artery surgery results A view from
    California, J Thorac Cardiovasc Surg

(NY report card induces surgeons to reject sicker
patients, cont.)
  • The incentive to refuse treatment for high-risk
    patients has created a kind of spiritual crisis
    in the field of cardiac surgery. Heart surgeons
    are shrinking from taking on the toughest cases
    because of statistics.
  • Sandeep Jauhar (When doctors slam the door
    Under the current system, a doctors reputation
    may depend on his or her willingness to turn away
    a dying man, New York Times Magazine, March 16,
    2003, 30, 34).

Even the best surgeons dont trust the NY report
  • There is nothing that separates me from the
    rest of the people on the list, Dr. Jeffrey
    Gold said. And even though Dr.Gold is ranked at
    the top of the 1994 report, he has qualms about
    it. Im concerned about the predictability of
    it, he said. I certainly would not use it as
    the sole way of selecting an institution or a
  • Elisabeth Bumiller (Death rankings shake New
    York cardiac surgeons, New York Times, September
    6, 1995, A1, B11)

New Yorks angioplasty report card is having a
similar effect
  • An overwhelming majority of cardiologists 79
    in New York say that, in certain instances, they
    do not operate on patients who might benefit from
    heart surgery, because they are worried about
    hurting their rankings on physician scorecards
    issued by the state, according to a survey
    released today.
  • Marc Santora, Cardiologists say rankings sway
    choices on surgery, New York Times, January 11,
    2005, A18.

Report cards cause resource shifts to services
being graded
  • Although paying for high quality is an
    innovation with obvious potential benefits, it
    may also lead to the misallocation of
    resources. The medical director at one of
    Californias largest managed-care organizations
    described the problem succinctly 'Everybody's
    doing what they are required to do in responding
    to the quality measurements that are being used.
    Every ounce of energy is being diverted to
    responding to these not one ounce of energy is
    going to any other aspect of quality.
  • Lawrence Casalino, The unintended consequences
    of measuring quality on the quality of medical
    care," New England Journal of Medicine
    19993411147-1150, 1147.

(NYs angioplasty report card, cont.)
  • The patient population in the Michigan
    angioplasty registry had a significantly higher
    frequency of comorbidities. A case selection
    bias driven by the fear of public reporting of
    higher mortality rates in New York was one
    possible explanation .
  • Mauro Moscucci et al., Public reporting and
    case selection for percutaneous coronary
    interventions, J Am Coll Cardiology

(Report cards cause resource shift, cont.)
  • If providers face a number of tasks and
    resources are limited, then effort will be
    allocated toward those tasks that are explicitly
    rewarded, taking resources away from other
    activities. Inevitably, ... the dimensions of
    care that will receive the most attention will be
    those that are most easily measured and not
    necessarily those that are most valued.
  • Meredith B. Rosenthal et al., Paying for
    quality Providers incentives for quality
    improvement, Health Affairs 200423(2)127-141,13

(Report cards cause resource shift, cont.)
  • From the present study which found HMOs were
    less likely to detect colorectal cancer early
    and the earlier breast cancer study which
    found HMOs were more likely to detect breast
    cancer early one can infer that the incentives
    of health plans are to allocate resources to
    those activities upon which they are measured.
    This suggests that preventive screening for
    conditions such as colorectal cancer that are not
    required to be in a report card (such as HEDIS)
    are more likely to be neglected.
  • Anna Lee-Feldstein et al., Health care factors
    related to stage at diagnosis and survival among
    Medicare patients with colorectal cancer, Med
    Care 200240362-374, 374.

Example of a shift in resources triggered by
report cards
  • It may seem that an optimal performance
    standard would be to maximize the percentage of
    patients who have an HbA1c lt7.0. Such a standard
    may divert a health systems attention from
    treating poorly controlled patients to
    disproportionately focusing on the larger numbers
    of patients who are slightly above this cutoff.
  • Rodney A. Hayward et al., Quality improvement
    initiatives, Diabetes Care 2004 27 (Suppl.
    2)B54-B60, B56.

Reports on number of procedures do not pose risks
report cards do
  • For a few procedures, evidence exists that
    quality is higher at hospitals that do high
    volumes of those procedures. Reports on the
    number of procedures do not create the three
    report card risks
  • (1) Inaccuracy
  • (2) Doctors avoiding sicker patients
  • (3) Doctors shifting resources away from
    unmeasured to measured services

Practice makes perfect rule has been found for
  • Treatment for AIDS (strong correlation)
  • Pancreatic cancer surgery (strong)
  • Esophageal cancer surgery (strong)
  • Abdominal aortic aneurysm surgery (strong)
  • Congenital heart disease surgery (strong)
  • Coronary-artery bypass surgery (weak)
  • Coronary angioplasty (weak correlation)
  • Carotid endarterectomy (weak)
  • Other types of surgery for cancer (weak)
  • Some orthopedic procedures (weak)
  • Treatment of low-birth-weight and premature
    babies (weak)
  • Source Kenneth W. Kizer, The volume-outcome
    conundrum, New England Journal of Medicine

  • We have reviewed the first of three assumptions
    that have to be true in order for report cards to
    work that report cards improve quality of care.
    Report cards can damage quality three ways
  • (1) By being inaccurate
  • (2) by inducing providers to refuse to treat
    sicker patients (regardless of how accurate the
    report card is) and
  • (3) by inducing providers and plans to shift
    resources away from unmeasured services.

We turn now to the last two assumptions about
report cards
  • (2) Quality improvements inevitably lead to cost
  • (3) The cost reductions achieved by report cards
    outweigh the cost of producing report cards.

Quality improvement does not inevitably lead to
lower costs
  • Although it's a widely held belief that
    quality health care leads to lower costs,
    insurers have no data that directly measures
    return on investment of their P4P
    pay-for-performance programs. Healthleaders
    (Paula DeWitt , The new incentive plan, March
    2004, http//
    php? contentid53006, accessed April 10, 2004)

(Quality improvement does not lead inevitably to
lower costs, cont.)
  • Results of this study show that it is possible
    to increase SFDs symptom free days in children
    with asthma. However, the improvements were
    realized with an increase in the costs associated
    with asthma care.
  • Archives of Pediatrics and Adolescent Medicine
    (S.D. Sullivan et al., A multisite randomized
    trial of the effects of physician education and
    organizational change in chronic asthma care
    Cost-effectiveness analysis of the Pediatric
    Asthma Care Patient Outcomes Research Team II
    (PAC-PORT II), 2005159428-434, 428).

(Quality improvement and costs, cont.)
  • Right from the start, it has been one of the
    great illusions that quality and cost go in
    opposite directions. There remains very little
    evidence of that.
  • Donald Berwick, President and CEO, Institute
    for Healthcare Improvement (A deficiency of
    will and ambition A conversation with Donald
    Berwick, Health Affairs, Web Exclusive,
    January-June 2005, W5-1-W5-9, 7)

Report card infrastructure will be expensive
  • To achieve an NHIN (National Health Information
    Network) would cost 156 billion in capital
    investment over 5 years and 48 billion annual
    operating costs or a total of about 400 billion
    over 5 years, or 2 of total spending.
  • Note This is infrastructure only. The cost of
    grading thousands of services provided by
    hundreds of thousands of providers is extra.
  • Rainu Kaushal et al., The costs of a National
    Health Information Network, Ann Int Med
    2005143165-73, 165

Report cards on providers suffer defects similar
to those on schools
  • No Child Left Behind report cards on schools
    have been criticized for the same reasons
    provider report cards have
  • They dont adjust for factors outside school
    control and are therefore inaccurate
  • they shift resources away from unmeasured
    services and
  • they are costly.

Bipartisan group concluded NCLB impedes quality
  • The underlying problem is that all schools
    are measured equally, regardless of differences
    in socioeconomic factors or unique challenges
    the schools face (p 15). Schools are
    reluctant to accept transfers because they fear
    it would increase their chance of failing (p.
  • National Conference of State Legislatures, Task
    Force on NCLB, Final Report, February 2005.

Governor assumes Alliance can measure quality
  • The Smart Buy Alliance will adopt uniform
    methods of measuring quality of care and will
    purchase health care based upon those
    measurements. Consumers and purchasers cannot
    make good decisions in the marketplace without
    access to easy-to-understand information about
    health care ... quality. The Alliance will
    require health plans and providers to participate
    in efforts to make such information available.
    The Community Measurement Project is an
    example of the type of information to be made
    available. (Governor Pawlenty unveils Smart
    Buy Alliance to slow health care costs and
    improve quality, press release, November 29,
    2004, http//, accessed
    November 30, 2004).

Diabetes quality measures, Community Measurement
  • None of these measures is risk-adjusted
  • (1) patients with HbA1c less than or equal to
    8.0 (and 7.0) OUTCOME
  • (2) patients with LDL-cholesterol less than 130
    (and 100) OUTCOME
  • (3) patients with blood pressure less than
    130/85 (and 130/80) OUTCOME
  • (4) patients over age 40 taking aspirin
  • (5) patients known to be nonsmokers OUTCOME
  • (6) patients with annual screening for kidney
    and eye complications PROCESS
  • (7) A composite of the first five measures
  • An outcome measure is one that measures the
    effect of treatment on patient health. Survival
    after surgery is an example of an outcome
    measure. So too is reported pain level in
    arthritis patients following drug treatment. The
    outcome measures shown above are sometimes called
    intermediate outcome measures because they are
    not equivalent to absence of disease but are
    rather physiological indicators that serve as
    rough predictors of health in the future. A
    process measure is one that measures how
    frequently doctors complied with a recommended
    process, such as taking blood pressure or
    administering beta blockers after a heart attack.
  • Source Gail M. Amundson and John Frederick,
    Medical group quality data a reality,
    MetroDoctors The Journal of the Hennepin and
    Ramsey Medical Societies, January/February 2004,

HMO advocates have called for report cards for 35
  • A performance reporting system of proven
    reliability would be developed and installed to
    provide both individual consumers and quantity
    buyers (e.g., HEW) with accurate information on
    the comparative performance of alternative
    sources of health care. (HMOs would be required
    to make such information available.)
  • Paul M. Ellwood et al. (Health maintenance
    strategy, Medical Care 19719291-298, 297).

(HMO advocates have called for report cards,
  • The development of an effective system of
    collecting and disseminating data on quality and
    outcomes is an essential component of a health
    care reform strategy. Such a strategy will allow
    the monitoring of the impact of cost containment
    initiatives on health care quality. . . . The
    Commission and the Commissioner of Health will
    work collaboratively to collect and disseminate
    comparative data on the quality of services
    provided by providers, health plans, and ISNs in
    order to facilitate competition and continuously
    improve systemwide health care quality.
  • Minnesota Health Care Commission (Containing
    Costs in Minnesotas Health Care System A Report
    to Governor Arne H. Carlson and the Minnesota
    Legislature, January 25, 1993, 28).

High-deductible advocates also call for report
  • Consumer-directed health care supposes a new
    formulation one driven by consumers with
    cash-in-hand, demanding to know for themselves
    who is the best urologist in town, how do I get
    the most value for the money Im spending?
    Information systems to support this movement will
    grow exponentially. But the information ... is
    not an end to itself. The real revolution will
    come when health-care consumers use that
    information to reward higher quality and punish
    the mediocre.
  • Greg Scandlen, Galen Institute (How
    consumer-driven health care evolves in a dynamic
    market, Health Services Research
    2004391113-1118, 1117)

But accurate report cards are almost nonexistent
  • "We have no assurances that the competition of
    health plans . . . will reward those who
    deliver higher quality care. . . . Purchasers
    and consumers have not, so far, rewarded or
    punished plans based on quality. . . . If
    purchasers and consumers had tools that allowed
    them to buy on quality, ... the thinking that lay
    behind the original HMO movement may still play
  • Paul M. Ellwood, Jr. and George D. Lundberg,
    ("Managed Care A Work in Progress," Journal of
    the American Medical Association
    19962761083-1086, 1085).

(Accurate report cards are almost nonexistent,
  • Physician profiles are not and may never be
    ready for public consumption.
  • Andrew Bindman,Can physician profiles be
    trusted? JAMA 1999281 2142-2143, 2143)

(Accurate report cards are almost nonexistent,
  • Hospital profiling remains an unproven strategy
    for improving outcomes of care.
  • David W. Baker et al., Mortality trends during
    a program that publicly reported hospital
    performance, Medical Care 200240879-90, 879.

Quality can be improved without report cards
  • The Cooperative Cardiovascular Project induced
    large improvements in quality of care of heart
    attack patients in four pilot states by giving
    doctors feedback (at the hospital, in seminars,
    by phone, and by mail).
  • Improvements included increased use of aspirin
    (84 to 90) and beta blockers (47 to 68), and
    reduced one-year mortality (32.3 to 29.6).
  • Source Thomas A. Marciniak et al., Improving
    the quality of care for Medicare patients with
    acute myocardial infarction Results from the
    Cooperative Cardiovascular Project, JAMA

(Quality improvement without report cards, cont.)
  • Other methods of improving quality without
    report cards include
  • (1) Traditional research
  • (2) Establishing universal health insurance
  • (3) Reducing drug prices
  • (4) Ending the nurse shortage
  • (5) Public health programs.

Electronic medical records (EMRs)
  • The following slides demonstrate that the
    evidence does not support the claim that
    interoperable EMRs will improve quality or reduce

Advocates claim EMRs can do it all
  • By computerizing health records, we can avoid
    dangerous medical mistakes, reduce costs, and
    improve care.
  • George W. Bush, State of the Union Address,
    January 20, 2004 (quoted in Rainu Kaushal et al.,
    The costs of a National Health Information
    Network, Ann Int Med 2005143165-173, 165).

(Advocates claims re EMRs cont.)
  • It is widely believed that broad adoption of
    electronic medical records (EMR) systems will
    lead to major health care savings, reduce medical
    errors, and improve health.
  • Richard Hillestad et al., Can electronic
    medical record systems transform health care?
    Potential health benefits, savings, and costs,
    Health Affairs 20051103-1117, 1103.

Proponents make three claims
  • (1) EMRs save time
  • (2) EMRs improve doctors decisions
  • (3) EMRs facilitate the production of report
    cards which in turn improve quality.
  • None of these claims have been proven.

EMRs have not been shown to save time for
  • With the exception of pharmacy settings, there
    is little consistent evidence that IT
    information technology systems save time for
    providers. In some instances, the literature
    suggests the reverse.
  • Medicare Payment Advisory Commission (Report to
    Congress New Approaches in Medicare, June 2004,

(EMRs dont save time, cont.)
  • Only 13 of 100 trials evaluated the impact
    of the CDSS clinical decision support systems
    on clinician workflow, with more than half of
    these CDSSs requiring more time and effort from
    the user compared with paper-based methods.
  • Amit X. Garg et al., Effects of computerized
    clinical decision support systems on practitioner
    performance and patient outcomes A systematic
    review, JAMA 20052931223-1238, 1226.

EMRs have not been shown to improve health
  • Fifty-two trials of clinical decision support
    systems assessed patient outcomes . Only 7
    trials reported improved patient outcomes.
  • Amit X. Garg et al., Effects of computerized
    clinical decision support systems on practitioner
    performance and patient outcomes A systematic
    review, JAMA 20052931223-1238, 1231.

(EMRs and health, cont.)
  • In 2001, the Agency for Healthcare Research and
    Quality determined that 14 safety practices had
    greater strength of evidence regarding their
    impact and effectiveness than any practice which
    relied on IT. These include such low-cost items
    as appropriate provision of nutrition and use
    of maximum sterile barriers while placing central
    intravenous catheters to prevent infections.
  • Medpac (Report to Congress New Approaches in
    Medicare, June 2004, 162)

Some studies report harm done by computers
  • We found that a widely used CPOE computerized
    physician order entry system facilitated 22
    types of medication error risks. Examples include
    fragmented CPOE displays that prevent a coherent
    view of patients medications, pharmacy inventory
    displays mistaken for dosage guidelines, and
    inflexible ordering formats generating wrong
  • Ross Koppel et al., Role of computerized
    physician order entry systems in facilitating
    medication errors, JAMA 20052931197-1203.

NHIN advocates favorite studies are opinions,
not evidence
  • Two papers cited frequently by EMR advocates
  • Richard Hillestad et al., Can electronic
    medical record systems transform health care?
    Potential health benefits, savings, and costs,
    Health Affairs 20051103-1117, 1103.
  • Jan Walker et al., The value of health care
    information exchange and interoperability,
    Health Affairs Web Exclusives, January-June 2005
    24, Suppl. 1)W5-10-18.

Hillestad et al.
  • Conclusion Fully standardized HIEI health
    care information exchange and interoperability
    could yield a net value of 77.8 billion per
  • According to an accompanying paper, savings
    would amount to 1.6 percent of health spending in
    2019 (Clifford Goodman, Do it for the quality,

(Hillestad et al. cont.)
  • Authors are part of the Rand HIT Project.
  • Funded by Cerner, GE, Hewlett-Packard, Johnson
    and Johnson, and Xerox.
  • Their methods were extraordinarily biased
  • The currently useful evidence is not robust
    enough to make strong predictions, and we
    describe our results only as potential.
  • We chose to interpret reported evidence of
    negative or no effect of HIT as likely being
    attributable to ineffective or not-yet effective

Walker et al.
  • Conclusion Net savings from national
    implementation of fully standardized
    interoperability between providers and five other
    types of organizations could yield 77.8 billion
    annually, or approximately 5 percent of the
    projected 1.661 trillion spent on US health care
    in 2003 (W5-10)

(Walker et al. cont.)
  • Funded by the Foundation for the eHealth
    Initiative, which is funded by the computer and
    insurance industries among others.
  • We convened a panel of nationally known
    experts. With relatively little research and
    literature on the value of HIEI health care
    information exchange and interoperability, the
    panelists played an important role.

Disease management
  • The following slides demonstrate that disease
    management (DM) is promoted by insurance
    companies and DM vendors, and that the evidence
    does not support the claim that disease
    management will reduce health care costs.

Disease Management Association of Americas
board, 2006
  • Lifemasters Jefferson Medical College
  • Wellpoint Dept of Mental Health, TN
  • Geisinger Health Plan American Healthways
  • McKesson Health Solutions Air Logix
  • Matria Healthcare Magellan Health Services
  • Caremark Rx Sanofi-Aventis
  • Fibrogen Kaiser Permanente
  • Pitney-Bowes American College of
  • Astra-Zeneca Pharmaceuticals Cardiology

DM was begun by the drug industry
  • The boom in DM was initiated by the
    pharmaceutical industry. By 1995, most
    pharmaceutical manufacturers had unveiled a
    variety of DM programs. Merck-Medco Managed
    Care sells its diabetes DM program to
    employers and plans , identifying patients
    with diabetes through its 51-million-person
    pharmacy data base.
  • Thomas Bodenheimer, Disease management
    Promises and pitfalls, New Eng J Med
    19993401202-1205, 1202.

No evidence that disease management saves money
  • On the basis of its examination of
    peer-reviewed studies of disease management
    programs, CBO finds that to date there is
    insufficient evidence to conclude that disease
    management programs can generally reduce the
    overall cost of health care services.
  • Congressional Budget Office (An Analysis of the
    Literature on Disease Management Programs,
    October 13, 2004, http//
    ndex5909sequence0, accessed September 25,

(DM doesnt cut costs, cont.)
  • Although interest in disease management
    programs is growing, evidence of their clinical
    and cost effectiveness remains limited. Without
    many attractive alternative mechanisms to control
    costs, many employers are adopting disease
    management despite the lack of evidence.
  • Center for Studying Health System Change
    (Ashley Short et al., Disease management A leap
    of faith to lower-cost, higher-quality health
    care, October 2003, Issue Brief No. 69, 3)

(DM doesnt cut costs, cont.)
  • Despite high expectations, evidence of both
    disease management and case management programs
    success in controlling costs and improving
    quality remains limited.
  • Center for Studying Health System Change
    (Ashley Short et al., Disease management A leap
    of faith to lower-cost, higher-quality health
    care, Issue Brief No. 69, October 2003).

(DM doesnt cut costs, cont.)
  • A growing number of DM programs offer to
    monitor patients with chronic conditions and help
    avoid dangerous complications. But the long-term
    cost effectiveness of such programs has been hard
    to measure. ... There is a chance DM programs
    could actually raise costs.
  • Wall Street Journal (Laura Landro, Does
    disease management pay off, October 20, 2004,

(DM doesnt cut costs, cont.)
  • Weve made real progress in keeping people
    healthier who have chronic illnesses, says
    Edward Wagner with Group Health Cooperatives
    Center for Health Studies in Seattle. But we
    still dont know definitively what the economic
    impacts of disease management are. Dr. Wagner
    expresses skepticism about outsourced
    disease-management programs.
  • Wall Street Journal (
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