Alexander 2004
CMS-Premier Hospital Quality Incentive Demonstration Project
Stephanie AlexanderSenior Vice PresidentPremier Inc.Healthcare Informaticswww.qualitydemo.com
Alexander 2004
About Premier• Premier, Inc., is a strategic alliance owned by
200 of the United States’ leading not-for-profit hospitals and healthcare systems.– These systems operate or are affiliated with nearly
1,500 hospitals and hundreds of other healthcare sites.
Owners
Affiliates
Alexander 2004
Is there a business case for quality in hospitals?
Performance Top Performers Lowest
Hospitals PerformanceGroup
Innovation Group Opportunity
Group
Top decile in performance
(low cost and high quality)
Bottom quartile in performance
(high cost, low quality)
Alexander 2004
CABG Performance
Innovation Group
Performance Group
Opportunity Group
Number of Hospitals (Premier-PerspectiveTM) 7 46 17
Isolated CABG Procedures: Discharges 4,024 11,853 5,397
Wage- and Severity-Adjusted Average Cost $16,043 $20,123 $26,321
Risk-Adjusted Inpatient Mortality 2.78% 2.92% 3.29%
Return to OR 0.62% 2.12% 2.43%
Aspirin used During Hospitalization 91.39% 67.65% 54.57%
Source: Premier PerspectiveTM
Alexander 2004
Non-collaborators’ financial performance
Jan 98Feb 98
Mar 98Apr 9
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Average Wage-adjusted Cost per Case for CABG: Non-collaborators
Source: Premier PerspectiveTM
Alexander 2004
Collaborators’ financial performance
Source: Premier PerspectiveTM
Jan 98Feb 98
Mar 98Apr 9
8May 98
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0Apr 0
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Average Wage-adjusted Cost per Case for CABG: Collaborators
Alexander 2004
CMS/Premier Hospital QualityIncentive Demonstration Project
A three-year effort linking payment with quality measures
Top performers identified in five clinical areas Acute Myocardial Infarction Congestive Heart Failure Coronary Artery Bypass Graft Hip and Knee Replacement Pneumonia
278 participating hospitals nationwide
Alexander 2004
Identifying Top Performers
Composite Quality Index will identify hospitals performing in the top two deciles in each clinical focus group
Composed of two components: Composite Process Rate Risk-Adjusted Outcomes Index
Clinical conditions without outcomes indicators use only the Composite Process Rate
Alexander 2004
Widely accepted quality measures
The CMS/Premier quality measures are based on clinical evidence and industry recognized metrics, including:
All 10 indicators from the National Voluntary Hospital Public Reporting Initiative
27 indicators from the National Quality Forum (NQF). 24 indicators from CMS 7th Scope of Work. 15 indicators from JCAHO Core Measures. 3 indicators proposed by The Leapfrog Group. 4 indicators from the Agency for Healthcare Research
and Quality’s (AHRQ) patient safety indicators.
Alexander 2004
Medicare Payment Incentives• Incentive payment threshold changes
annually for each clinical condition• Top decile performers in a given clinical area
receive a 2 percent payment supplement per condition
• Second decile performers receive a 1 percent payment supplement per condition.
• Reduced payments in year 3:• 1% reduction if < year one ninth decile• 2% reduction if < year one tenth decile
Alexander 2004
Anticipated payment scenario
1st Decile
Hospital
Hospital
Hospital
Year One Year Two Year Three
Top Performance Threshold
Payment Adjustment Threshold
2nd Decile
3rd Decile
4th Decile
5th Decile
6th Decile
7th Decile
8th Decile
9th Decile
10th Decile
1st Decile
2nd Decile
3rd Decile
4th Decile
5th Decile
6th Decile
7th Decile
8th Decile
9th Decile
10th Decile
1st Decile
2nd Decile
3rd Decile
4th Decile
5th Decile
6th Decile
7th Decile
8th Decile
9th Decile
10th Decile
Condition XCondition X
Condition X
Alexander 2004
Heart Failure: Pre-release vs 4Q03 Median Comparisons Premier HQI Demonstration Project Participants
Preliminary Data
32.19%
83.08%
75.00%
51.61%
60.47%
38.10%
85.81%
77.97%
64.27%65.79%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
100.00%
Discharge instructions LVF assessment ACEI for LVSD Adult smokingcessation counseling
Composite QualityScore
Measure
Rat
e Pre-Release
4Q03
Alexander 2004
Composite Score: All 34 HQI Project MeasuresHQI Project Time Period: 4Q03 vs 4Q03 - 1Q04
83.0%
76.9%
69.7%
65.4%
86.5%
66.6%
71.3%
78.3%
84.1%87.2%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Top 2nd Median 8th Bottom
Decile Threshold
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ore