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Does Performance Really Matter?

Trent Haywood, MD, for HealthLeaders Media, May 8, 2008

Recently the Centers for Medicare and Medicaid Services indicated its intention to move forward with measures to support value-based purchasing, a system where Medicare pays hospitals based on the quality of care delivered and patient outcomes. However, CMS failed to state whether the value-based model will transition healthcare to a new model or create the worst case scenario, a hybrid model where performance only partially counts and regulation requirements remain heavy.

In mid-April, Medicare proposed adding nine new conditions, such as bed sores, to a growing list of complications that Medicare won't pay to treat if they were acquired at the hospital. Granted, the government has only proposed these additions, but the message is clear: Medicare doesn't want to cover instances where hospital mistakes or less than optimal care contribute additional cost to the hospital stay.

At first glance, not paying for ineffective care makes sense. However, Medicare offered these changes with no direction as to how they relate to existing measurement standards. In addition, some of the medical complications are very difficult for hospitals to detect or prevent. Further, Medicare also is asking hospitals to begin reporting on 43 new quality measures in order to receive full payment. The prospect remains for the government to add other conditions, too.

The previous push for onsite hospital accreditation, including Joint Commission reporting, could be considered reasonable as hospital quality and safety data were not readily available. With the recent and accelerated push for transparency of performance information, it seems less realistic to continue to ask hospitals to meet accreditation standards that were designed as approximates for quality. In fact, hospitals are currently forced to make the tough decision of how many resources to allocate toward accreditation activities while still meeting the new performance standards.

Imagine that performance only partially counted in golf. We would have tournament officials stating Tiger Woods gets partial credit for his performance but the officials need to investigate whether his swing is consistent with the idealized swing before he could be considered the champion.

Providing quality care for patients is always the ultimate goal. However, there are limited resources available for healthcare, and hospitals can expect to spend hundreds of millions of dollars to meet the new quality measures. The last thing we want is for hospitals to be forced to divert resources and funding from direct patient care.

To be truly efficient, measurement standards need to take into consideration the succession of administrative requirements they trigger in a hospital. Further, as the conditions being reviewed become less precise, the costs of mechanisms needed to ensure reliable coding and comply with mandates, in addition to the cost of enforcement should be determined. While saving money may not be CMS’s sole objective, performing some sort of risk/benefit analysis is certainly warranted.

We also must be aware of the unintended consequences. The first set of conditions for which no payment will be made hasn’t even been implemented yet. Therefore, we don’t have the benefit of understanding the impact of these newest standards. Moreover, it’s worth considering whether CMS is even equipped to manage and process data effectively to ensure accurate payment to hospitals that meet the standards, which is important given that hospitals are already financially fragile. We would gain substantially from a “test run” with the first set of rules before launching into a discussion around nine additional new conditions.

These new guidelines bring focus and attention to hospital performance in an important and worthwhile way. However, simply adding another layer of reporting measures is not going to magically improve hospital performance —particularly if they are already burdened by outdated modes of looking at quality.

If quality patient care is the goal, then performance is what truly matters. Now that we have systems to measure performance in precise areas of patient care, perhaps other performance measurement burdens could be reduced. Otherwise, it calls into question whether performance really matters. If performance truly matters, it seems it can't be for partial credit.


Trent Haywood, MD, is senior vice president and chief medical officer for VHA, Inc., an Irving, TX–based healthcare alliance that provides supply chain management services and networking opportunities for hospitals and healthcare providers. 
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