Measurables and Immeasurables

Measurables and Immeasurables

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It all sounds simple enough. You measure everything you do. You gather claims data. You measure what works. You show measures of what works to doctors and nurses. You write protocols for doctors and nurses to follow what works. You pay more for what works. You pay less for what doesn’t work. You remove pay incentives that cause doctors to do more. You gather together doctors who lead organizations with track records for providing better care at lower costs at the White House.

You trot out the theory of evidence-based care,

1. For any given diagnosis, the doctors has a number of options, and you assume most diagnoses fall neatly into diagnostic bins.

2. Committees of doctors and others, such as health plans and Medicare medical directors, track data outcomes related to these options and develop protocols for best results.

3. Doctors follow protocols, and outcomes improve.

Voila! You have the rudiments of a national policy for providing higher quality care at lower costs.

But, as always, simply measuring care to achieve better results has sticking points. The devil is in the details. The devils are the doctors.  The scientific method and the political realities conflict. Physician and patient human nature keeps muddying the big picture. They insist on doing what they think is best based on experience. Critics say you cannot extend one organization’s results to the nation as a whole when salaried physicians dominate that organization and independent fee-for-service doctors take care of 90% of patients.

In any event:

1.Doctors resist protocols, preferring instead their clinical intuition based on their experience.

2. Hospitals and doctors lose money when they improve quality and reduce complications for which they were previously paid.

David Leonhardt, a New York Times economics expert, brilliantly explains these sticking points and how to side-step around them in his portrait of the life and works of Brent James, MD, the 58 year old chief quality officer of Intermountain Healthcare, a hospital system in Utah and Idaho, with an overwhelmingly Mormon patient constituency. According to Leonardt, “James’s answer to such skepticism — and there is a lot of it, especially beyond Intermountain — is to show results. Intermountain has reduced the number of preterm deliveries, as well as the number of babies who must spend time in the neonatal-intensive-care unit. So-called adverse drug events, which include overdoses and allergic reactions, were cut in half in the mid-1990s. A protocol for dealing with one broad category of pneumonia cut its mortality rate by 40 percent over several years. The death rate for coronary-bypass surgery was cut to 1.5 percent, from the national average of about 3 percent. Medicare data on heart-failure and pneumonia patients show that Intermountain has significantly lower-than-average readmission rates. In all, James estimates that the changes have saved thousands of lives a year across Intermountain’s network. Outside experts consider that estimate to be fair. “James gets results by being deferential to doctors and by appealing to their sense of idealism, which he calls ‘the flame.’ That flame burns brightly within the heart of any physician. It’s what brought us into medicine. That’s what defines us as a profession. And that’s your real leverage point. There are a few outliers, but don’t let those outliers get you off track.” James notes that many medical questions still have no data-proven answer. Many never will. When patients have conflicting symptoms, statistics and protocols won’t always help. Sometimes, intuition is the only good tool a doctor has.Besides, intuition, other immeasurables exist. How do you define and measure“quality” with patients and doctors when quality is in the eyes of the beholder? How do you measure the quality of physician and hospital performance, when outcomes depend mostly on patient behavior outside doctors’ offices and hospitals? How do you define compassion, bedside manner, patient expectations, trust, efficiencies and understanding of communication, promptness and convenience of access, and amenities at the point of care?To sum up, government can mandate what the doctor measures, what it will pay doctors from its deep tax treasures, but it does not have the retrospective perspective, to define or measure the unclassifiable subjective, or patient-doctor intangible relationship pleasures. 

Richard L. Reece, MD is author of Obama, Doctors, and Health Reform and blogs at www.medinnovationblog.blogspot.com.

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34 Comments on "Measurables and Immeasurables"


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Next the famous host oprah afforded tights perfectly as a cashmere cosy sweater in the super Winfrey’s preferential pieces.

Guest
Mar 12, 2011

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Barry Carol
Nov 17, 2009

“That’s true but it doesn’t tell the whole story. There just aren’t very many programs comparable to Kaiser across the country. It would be interesting to know what the local market percentages are for integrated systems.”
Karen – What do you think accounts for this? As I’ve asked in the past, if Kaiser is such a superior model, why hasn’t it taken hold in most, if not all other markets? I can think of several potential reasons but they are all mere speculation on my part. First, it is incredibly expensive to build a self-contained network that includes hospitals. To throw an insurer into the mix as the owner of the provider base further complicates the matter. Second, assuming a modest premium differential at most, a very large segment of the population, especially the relatively healthy, just plain prefers a broad network offering maximum provider choice to a narrow network. The third factor is a bit more practical. In crowded suburban areas of the Northeast, Mid-Atlantic and Midwest, people may be unwilling to travel a considerable distance, in time or miles, to reach an integrated multi-specialty clinic or one of the closed network’s hospitals when there are numerous comparable providers much closer to home. This is especially true during cold, snowy or icy winter weather which is generally not a factor in Northern and Southern CA. Finally, even for patients with a chronic disease that needs to be managed, many of us are perfectly capable of doing their part including maintaining copies of key test and procedure results, and keeping their PCP or main specialist informed regarding what other specialists do or recommend. This describes my own relationship with my cardiologist / PCP who works in a practice with six other doctors who do not (yet) use electronic records. The bottom line is that the Kaiser model may not offer as much money saving potential or nationwide applicability as its proponents think it does.

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Karen Mitchell
Nov 16, 2009

“That confirms that most people prefer the flexibility of a broad network vs. the limitations of a narrow network HMO as long as the insurance premium differential is not too wide.” — Barry
That’s true but it doesn’t tell the whole story. There just aren’t very many programs comparable to Kaiser across the country. It would be interesting to know what the local market percentages are for integrated systems.
“If they want to grow and have the capacity to handle many additional members, I would expect them to price more aggressively to pull market share away from competitors.”
According to Halvorson, Kaiser is currently building six hospitals so they seem to be growing quite healthily. From what I’ve seen, Kaiser tries to balance growth with expansion. A reputation for long appointment delays and overcrowded facilities are the last thing they want. They price as aggressively as needed to meet their internal growth targets.

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MD as HELL
Nov 16, 2009

Margalti,
You really seem to know very little about healthcare law regarding “allowable” charges, EMTALA, Medicaid, TriCare, etc.
The short version: When you are mandated to provide a service on demand without anyone required to pay for the sevice, it is theft by legislation. (EMTALA). When you are told what you may charge for a service and told what you are going to get, then your right of contract has been stolen.
When you are told you will get 9% or 21% less this year than last year for a service (and you will like it and have no appeal) that is theft by fiat.
There are only two responses possible: 1. Roll over and take it. 2. Deny the service to those not paying enough. That is why Medicaid has been such an albatross. Today’s doctor will not be here tomorrow under this type of reform.

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Barry Carol
Nov 16, 2009

Karen – Thanks very much for the link to the Congressional Research Service paper. It was interesting to note that the term actuarial value refers to the percentage of costs for benefits across a standard population and average medical prices. It does not speak to what any one individual would actually pay out of pocket. The paper also indicates that only 23% of the population is in HMO plans vs. a much higher percentage in PPO’s. That confirms that most people prefer the flexibility of a broad network vs. the limitations of a narrow network HMO as long as the insurance premium differential is not too wide. I have no idea how wide the differential would have to be to induce a much higher percentage of the population to accept the HMO structure.
In thinking about Kaiser specifically, if they can demonstrate clear outcome superiority because of their use of electronic records and integrated group practices in, say, the management of chronic disease including diabetes, asthma and heart disease, it is quite likely that they will attract a disproportionate number of members with these conditions. For healthy people, by contrast, that disease management capability will have no perceived immediate value. Those folks would likely much prefer the flexibility of being able to access a broad network when and if they need care. As Nate suggested in an earlier comment, that could leave Kaiser with a disproportionate number of high utilizers among its members.
Separately, it was also interesting to read that Medicare Parts A, B and D earned an actuarial value of only 76% which was worse than the PPO’s.
ICE – If Kaiser or any other provider group or insurer had a clear cost advantage vs. its competitors, I would not expect them to pass on the entire differential to members or potential members in lower premiums or enhanced benefits. If, as Karen suggested, they are at or near their capacity, they may not be interested in attracting new members beyond what they need to replace normal churn from job loss, people who move, age into Medicare or leave the Kaiser system for other reasons. If they want to grow and have the capacity to handle many additional members, I would expect them to price more aggressively to pull market share away from competitors. At any rate, like most non-profit insurers, their net profit margin is very low which implies they are already pricing their products as aggressively as they reasonably can.

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Harris Meyer
Nov 16, 2009

I again wanted to point out an overlooked aspect of this issue, that payers have not been eager to embrace payment methods that recognize and reward the documented outcomes improvements and cost reductions at innovative places like Intermountain, Geisinger, and Virginia Mason. See my article on this in the November issue of Managed Healthcare Executive.
http://managedhealthcareexecutive.modernmedicine.com/mhe/article/articleDetail.jsp?id=638750&pageID=1&sk=&date=
–Harris Meyer

Guest
Margalit Gur-Arie
Nov 16, 2009

108Days,
I am already paying taxes for stuff I don’t support. Lot’s of stuff. Always have. It’s not stealing. It’s democracy.

Guest
Actuary
Nov 16, 2009

Response to MD as Hell, who said:
Following protocols or guidelines or rules will never save your a** in court, which is why we need tort reform for cost control more than anything else you are jabbering about.
Part of Tort Reform — which is needed to “bend the cost curve” is to establish “official, sanctioned” guidelines and to make it harder to sue an MD who followed them.

Guest
Nov 16, 2009

Margalit, one could ask you the same question..
If the government taxed you to pay for progams and/or services you disagreed with, would you have any objection or would you lay down and be taxed? Did you agree with the GM bailouts? Wal Street bailouts? Cash for Clunkers? Maybe so, eventually they’ll come up with one you don’t agree with.

Guest
inchoate but earnest
Nov 16, 2009

Barry Carol wrote: “If you compare comprehensive PPO and non-Kaiser HMO plans to Kaiser, the benefits are essentially comparable and the premiums are comparable or within a few percentage points of each other as well. Historically, HMO’s offered a lower premium in exchange for less provider choice or a narrow network vs. a broad network. With salaried doctors and electronic records, which is the direction reformers want to move in, there should be cost advantages. If there are, they should be easy to demonstrate and should be reflected in lower premiums charged to members. “
Barry, let me heist a page from MD as HELL (& no royalties for you, MDaH!) and inquire as to why, if I’m keeping a population healthier at competitive prices, I’m OBLIGED to give you a better rate to boot?
You’re getting something valuable at a service/price point you can’t get elsewhere (else why are you buying it from me?), and I (as Kaiser) am keeping the delta.
That’s market dynamics at their finest.

Guest
Nov 16, 2009

thanx for the nice posts.. sir as iam a frequent traveller it was very usefull to me i use.. International Medical Insurance

Guest
Margalit Gur-Arie
Nov 16, 2009

Md as HELL, I don’t quite understand. Do you consider government taxing and paying for programs and services you personally disagree with, stealing?

Guest
MD as HELL
Nov 16, 2009

jd,
Even shorter: don’t rip me off and call it reform. You are just stealing from me. I will give away the world at my discretion to anyone who needs help. But I will not let you steal it from me so you can give it away and thump your chest.
If you don’t see the difference, then you really are a jd.

Guest
Karen Mitchell
Nov 16, 2009

Barry:“Kaiser, even in Northern CA where it is well regarded and has a significant market share, has not been able to offer health insurance for meaningfully less (including member co-pays and deductibles) than its traditional competitors, both for profit and not for profit.”
The actuarial value of the HMO and PPO, which includes more than premiums and co-pays, is discussed in a Congressional Research Service report from April. Comprehensive HMO plans like Kaiser are about 93% efficient vs 80%-84% for PPOs with similar plan provisions.
http://assets.opencrs.com/rpts/R40491_20090406.pdf
I think that Kaiser and traditional insurers have different objectives in the marketplace. Insurers compete for more patients to increase their revenue and profit. Kaiser’s objective is to increase the number of patients that have comprehensive care. There is no advantage to Kaiser to competing on price and flooding its facilities beyond capacity. Right now, Kaiser can charge market rates and use the difference between what it costs to deliver services to invest in major projects such as EHR and to grow the system at its own pace.