Valuing Value-Based Payment

Valuing Value-Based Payment

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The idea that payment should be linked to the value lies at the heart of most of the transactions we participate in on a daily basis. Yet, value based payment in healthcare has seemingly run into very rocky waters as of late.  It is at this precarious time that stakeholders representing large employers and other purchasers of health care’ took to the Harvard Business Review to write in defense of value based payment reform.  The authors pepper their article with cherry picked ‘successes’ of the value movement and urge the country to forge ahead on the current path.  The picture that comes to my mind hearing this is of the Titanic, forging ahead in dark waters, never mind the warning signs that abound.

One of the authors of the paper – Leah Binder – is President and CEO of the Leapfrog Group – a nonprofit organization founded in 2000 dedicated to triggering ” giant leaps forward in the safety, quality and affordability of U.S. health care by using transparency to support informed health care decisions and promote high-value care”.  This is a laudable goal, but it is very much predicated on the ability to measure value.  A perusal of the Leapfrog group’s  homepage notes a 1000 people will die today of a preventable hospital error.

The warning is explicit – choosing the hospital you go to could be the difference between life or death.  I have spent some time in the past about the remarkably weak data that lead to an estimate of 400,000 patients dying per year in hospitals due to medical errors, but suffice it to say the leapfrog group subscribes to the theory that of the ~700,000 deaths that happen in hospitals per year, half are iatrogenic.  With no exaggeration, I can say firmly that those who believe this are in the same company as those who believe the earth is flat.  If the home page of the Leapfrog group, examination of their claims in their HBR article merits additional concern.

The first example proferred relates to a reduction in venous thromboembolism or blood clots acquired in hospitals after a government agency (AHRQ) began tracking this from 28,000 in 2010 to 16,000 in 2014.  Binder et al., note that this means 12,000 fewer patients had ‘potentially fatal blood clots’.  Ostensibly this reduction in clots was due to reporting of these events and a Bush era rule from 2008 that put hospitals on notice that Medicare would no longer be paying for Hospital acquired Conditions (HAC) like clots after joint surgery.  But how exactly did hospitals achieve these impressive results?  While the hope is that hospitals achieved these reduction by better attention to therapies that prevent blood clots, the reality is somewhat more complicated.

For starters, orthopedic surgeons grew wary of searching for blood clots postoperatively.  The surgeons weren’t necessarily wrong to adopt a newly parsimonious approach.  Easy access to ultrasounds and cat scans meant many patients ended up diagnosed with small clots in the calf or in the small arteries of the lung that were unlikely to cause the patient harm.  It was not lost on surgeons that these clots were unlikely to be fatal to the patient, but were potentially fatal to the hospital and surgeon’s bottom line.

Yet another way of reducing hospital acquired conditions is to improve the diagnosis of blood clots that patients carry with them on admission.  It is clearly unfair to penalize hospitals for patients who present with a blood clot, so improving the diagnosis of these patients is important.  Unfortunately, too much of a good thing is usually too much of a good thing.  Some institutions actually began performing screening whole leg ultrasounds on all inpatients being admitted.  The whole leg is important because asymptomatic blood clots that do develop below the knee are generally not high risk , and indeed, many may resolve spontaneously with no treatment.  Worst of all the diagnostic accuracy of ultrasound falls precipitously as veins get smaller in the lower leg.  In 160 medical inpatients who had an ultrasound and a gold standard venogram, the positive predictive value of an ultrasound for a lower leg/calf/distal vein clot was 50%.  To reiterate – a positive result on a leg ultrasound has a flip of a coin’s chance of being correct, but it does allow the hospital to document a clot in the leg vein (also known as a Deep Vein thrombus (DVT)) as present on admission, and make any actually clinically meaningful DVT that subsequently develops not count towards the all important hospital acquired numbers.  The added benefit of documenting more DVTs in your medical inpatients (as opposed to the post-orthopedic surgical patients) is that it makes patients appear sicker.  This matters because another metric- the all important US News World Report rankings – are based on the difference between hospital expected and observed mortality.  The higher your expected mortality, the better.

It is not even clear that the numbers, if accurate, would tell the whole story regardless.  Consider the feared complication of DVT is a clot that spreads from the leg veins to the heart and causes death – a pulmonary embolism.  As far as I can tell, this information is not being publicly reported, but data for the incidence of pulmonary embolism is available from administrative claims data.  One would think that the reduction of DVTs should have lead to fewer PEs being diagnosed.  Unfortunately, very little in health care is predictable or intuited.   The incidence of PE’s has actually dramatically increased since 1998.  Our ability to find clots in the lung dramatically improved in 1998 with the introduction of MultiDetector Computed Tomography.  This would be ok if finding more PEs results in improved patient outcomes, but it has decidedly not.  Mortality from PE is stubbornly unchanged from prior to 1998 to now, ostensibly because we simply got better at diagnosing PEs that were never going to bother the patient.

The point of this long discussion on the blood clot example Binder et al raised is to demonstrate the absolute utter meaninglessness of the metrics highlighted as an example of success.  I am relatively certain we can ‘fix’ the overdiagnosis of PE problem by publicly reporting PE data.  I am sure the hospital/physician administrator class will respond with some non-granular edict that will strip the physicians ability to order an MDCT for PE.  As history would suggest, fewer unneeded CTs will be done, but fewer needed CTs will be done as well.  Medicine used to advance organically from the bottom up by education and discussion informed by data.  50% fewer coronary stents are placed in the elective setting over the last decade not because of public reporting or leapfrog, but because the data brought the frequent practice by cardiologists into question.

Binder et. al go on to highlight the benefits of transparency in improving outcomes in New York state patients undergoing cardiac surgery.  Apparently, public reporting of outcomes in cardiac surgery patients in New York lead to advances in cardiac care that saved lives.  Its a remarkable statement because there is ample data to suggest that lower mortality with public reporting in this setting related to lower surgical volume driven by a fear of operating on sicker patients.

One is left to contemplate the credentials of these arbiters of value in health care.  How can we possibly evaluate those who have anointed themselves as gods of value?  Data is no longer sufficient to rebut the movement because the data no longer fits the narrative.  It should be somewhat discomforting that this chart depicting the United States as outlier when it comes to dollars spent for life expectancy achieved is essentially unchanged since the Leapfrog group came into being in 2000.

The value based movement as currently envisioned has failed.  Apparently, a maze of third party payers and third party consultants don’t actually make healthcare better or less expensive.

The authors seem to understand the weakness of their arguments by ending their article with a warning about returning to the fee for service that brought us to the abyss.   Fee for service is the culprit that has produced ‘waste, heavy cost, and quality of care issues’, after all.  This is all true, but do the authors really believe that the fee-for-service system that existed brought no good with it?  It is certainly true that the last half century produced a  health care system emerged that was incentivized to treat patients.  Great waste arose as a result.  But this is the same health care system that finances cardiologists on call to open up your blocked artery within 90 minutes of where you currently sit.  It is also the same system that refused to give up on rare, fatal diseases in children when other systems have.  It should be lost on no-one that the value based movement has morphed into a tool to strong arm physicians into giving up on those it is cost inefficient to treat.  Burned by the managed care experience, third party payers have found a way to make physicians the deniers of care – employ the vast majority of physicians, and tie financial reimbursement to value based outcomes that incentivize doing less regardless of patient need.  A generation of physicians now emerges with an allegiance to populations and health systems, so it is no surprise that a good physician today is one who can provide a disney land experience to the consumer, all the while keeping length of stay in hospitals low, while documenting all possible diagnoses in EPIC to maximize patient expected mortality and maximize billing.

The best thing a customer with a sick heart who made the mistake of being admitted to the hospital with heart failure can do in 2017 is die.  Mounting evidence recently lead to leading heart failure physicians to write emphatically that hospital readmission reduction program is associated with fewer readmissions and more deaths.

Waste may abound in our current health care system, but the strategy employed by the value based seers exacts a heavy penalty on our sickest and most vulnerable.  Ideologues should consider that we indeed do have a health care system that resulted in too many heart transplants, but is it really better to live in a world where deserving patients don’t get a heart transplant?

This does not mean to say that massive waste does not exist in our health care system.  As an example: Hospitals have become massively bloated entities that innovate by hiring patient experience officers, giving patients ipads, paying hundreds of million dollars for EHRs that make physicians less productive, and hiring an army of hospitalists to check boxes and reduce length of stay.  I do mean to say that the current plan to give the nations dollars to insurance companies, health care consultants, and non-clinician administrators and expect an intelligent path forward is improbable.

A more honest path appears courtesy of true mavericks like the founders of the Surgical center of Oklahoma that accepts no third party payments but delivers care for elective surgeries at massive discounts relative to regular hospital systems.  Any surgical complications are covered free of charge.  Patients traveling from a distance have their airfare paid for and are put up in a hotel.  Sounds like patient, centric value based care to me.  How could this possibly happen without the Leapfrog group being involved?

I realize that the Surgical center of Oklahoma does not have to keep an ER open 24/7, and doesn’t have to pay for interventional cardiologists to be available constantly, but there is ample evidence to suggest the dollars being spent in hospitals are being spent on a variety of goods that have nothing to do with patient health.

Is it a pipe dream to believe that in the wealthiest country on earth we can have a robust private system that can deliver us CAT scans for $400 and still manage to provide a support system for those financially destitute?  We currently find ourselves hostage to a health care system that has convinced us that health care is unaffordable, and that keeping the lights on in your local hospital requires being paid $50 for an ECG.  The solution has been to create a whole bureaucracy of measurers that have just as much expertise at valuing Big Macs as they do healthcare.  The evidence we didn’t need to generate now tells us we don’t measure value well, and it has not resulted in a net reduction in cost or any significant increase in real value delivered.

I would suggest we refocus on the problem at hand.  We can start by labeling the current value based movement with the cliched yet appropriate moniker: #FakeNews

Anish Koka is a cardiologist based in Pennsylvania 

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36 Comments on "Valuing Value-Based Payment"


Member
Steve2
Oct 17, 2017

“A more honest path appears courtesy of true mavericks like the founders of the Surgical center of Oklahoma that accepts no third party payments but delivers care for elective surgeries at massive discounts relative to regular hospital systems. ”

Again, this is not so true. Hospitals are publishing prices. Their prices are not that much different than the surgicenter. (And they do have to keep cardiologists on call, a tiny part of the costs of having people on call.) Prices at other surgicenters are not that much different. Give these guys credit for great marketing, and for the gullible for falling for the marketing. Mostly, this is just a way for the guys at the OK surgicenter to make a lot of money. (Most of the claims about huge savings are comparing their costs with hospital charges. I hope that at this blog I don’t have to explain why that is a problem.)

Regardless, if you don’t want quality measures, what do you propose? Patients should just assume every doctor is the same? Outcomes don’t matter?

Steve

Member
Barry Carol
Oct 17, 2017

Anish, I appreciate your comments. I recognize that defining and measuring quality is a huge problem in healthcare and attempts to do so can create unintended consequences as you describe including creating disincentives to be willing to operate on the riskiest and most complex patients.

From a patient’s perspective, however, for a surgical procedure that can be scheduled in advance, I want to maximize my chances of being referred to a good and skilled surgeon who, in turn, can give me the best chance of a positive outcome. If you or your colleagues need a surgical procedure, your inside knowledge allows you to know or easily find out who the best surgeons are or at least which ones to avoid. I don’t have those contacts. How do I know that my referring doctor isn’t just sending me to his golfing buddy who may or may not be the right guy for what I need?

Why can’t there be physician referral services that can do more than just provide a list of doctors in the area? Why can’t they make some judgments about which doctors are highly regarded by their peers and which aren’t? I would like to know how many doctors and nurses a given surgeon has or has had as patients and how that number compares to peers. I would like to know how many of the relevant procedure a surgeon performs each month or each year and how does that number compare to the number that the specialty society deems sufficient to keep skills sharp.

If a patient posts a negative review about a doctor online, why do so many doctors threaten to sue for defamation even if the review is accurate? Isn’t it just a tactic to intimidate patients and try to stifle negative publicity? What can you offer as an alternative to these quality metrics that will give patients the best chance of a good outcome aside from blind faith that his referring doctor will send him to someone that he would be perfectly comfortable going to himself?

Member
Res Morgan M.D.
Oct 18, 2017

“Positive outcomes” after surgery can be just as much due to the anesthesiologist, radiologist, pathologist, scrub team, floor nurses, on-call docs, hospitalists – how are you going to choose them?

“physician referral services that can do more than just provide a list of doctors in the area? Why can’t they make some judgments about which doctors are highly regarded by their peers and which aren’t?”
Law-suit city – they’d be gone over night. Which is why physicians are so afraid of disciplining their peers.

Just curious – how do you choose a lawyer? an accountant? a priest?

Member
Allan
Oct 17, 2017

“best surgeons are or at least which ones to avoid. I don’t have those contacts.”

I trained at an institution that was well recognized for quality. The Cheif of Medicine had a fabulous reputation yet he thought one of the doctors was one of the best doctors on staff yet the house staff thought he was one of the worst in a hospital filled with great doctors. I had my own choice of who I would use for my family and it was different than who others selected. Then we have the giants who become known as giants as their skills decline. Add to that the problem that different situations are handled better by some than by others.

You sound as if you are looking for a specific quality solution for yourself. The best you can do is get more than one opinion on a serious illness, but if there are two opinions that differ how do you know the third opinion will be any better than either of the first two?

Take note that there are sites on the net that list the number of procedures done and the complications that occur for a few surgical procedures.

Member
Steve2
Oct 17, 2017

Asking other doctors, house staff, OR nurses and floor nurses will help tell you who to stay away from. It will only sometimes guide you to those with the best outcomes. I get to see all of the outcome data on our surgeons. It is not always obvious. Even then, I am not seeing all of the long term data. We are just starting to get better at that.

In general, I think obsessing over the “best” is not beneficial. Find someone you are comfortable with (if the surgeon with the best technical skills is someone you can’t communicate with, you may not benefit very much from that expertise) who is recommended by people you trust. The surgeon should be willing to tell you how many cases he does and/or the hospital should have that info available. BTW, don’t assume lots of cases is a guarantee of quality.

As an aside, we just took over another failing small hospital. One of the surgeons there is someone we fired, who went to another small hospital we took over (it is doing well now) and we fired him again. He is working at the place we are taking over now, and will be fired again. It amazes me how these guys keep getting referrals.

Steve

Member
Barry Carol
Oct 17, 2017

Thanks Steve. That’s very helpful as usual. I’m not looking for the best surgeon meaning one with a national or international reputation for excellence. I’m looking for solid competence, good communication skills and a willingness to explain things and answer my question.

So, my real question is this. If you needed a CABG or a hip or knee replacement and there were 100 surgeons in your region performing these procedures and you knew the outcomes data and the general reputation for all of them, how many of those 100 would you feel comfortable going to for the procedure or sending a friend or family member to? How many of the 100 are middling and should be avoided and how many are so bad that they should be fired or even weeded out of the profession altogether. If the vast majority are solidly competent and do a reasonable number of procedures per month or per year, than patients shouldn’t have as much to worry about as we think.

I needed an ablation in late 2015. The EP that I met at the hospital where I received my diagnosis wanted to treat me for atrial flutter. My cardiologist didn’t consider him that good for what I needed and referred me to a top notch doctor at another hospital system. I was fortunate to have a cardiologist who is really good, cares about his patients and makes it his business to build an excellent referral network including doctors outside of his own hospital’s system. Younger docs would probably feel pressured to keep as much care as possible within their hospital system which could easily be sub-optimal for patients in some cases.

Member
pjnelson
Oct 17, 2017

For Dr. Palmer,

According to Don Berwick, M.D., Medicare pays $16 Billion annually to the Medical Schools to support the expense of their post-graduate residencies. That funding is skewed by the size of each Medical School’s medical research budget. The under-graduate medical education is supported by a premium paid to the Medical School based on the healthcare provided by the Medical school faculty to their patients who have Medicare. There are no inducements to allocate these Medicare funds based on the portion of their residency positions that are devoted to Primary Physicians. In fact, there are eight medical schools that do not maintain a Family Medicine residency. Finally, medical research grants (government and philanthropy) pay an additional “mark-up” to the Medical school to administer each grant: now about 18%. The government and philanthropy funding is susceptible to all sorts of economic, social and political trends. As a result, the medical schools support their own lobby in Washington, American Association of Medical Colleges. Their headquarters recently moved into a new building. Parkinson’s Law plays on.

I perceive the following. The political discussion of reducing the Federal government’s contribution to our nation’s health spending occasionally focuses on reducing Medicare reimbursement. This would potentially represent a sudden and substantial change in medical school funding. As a measurement of a Medical School’s economics, the University of Nebraska Medical Center here in Omaha is the city’s largest employer. Finally, in modern times there has been a recession every 8 years. We are now 9 years since the last one.

Member
jacksandrew
Oct 17, 2017

It’s miles clean that our leaders within the Universities, philanthropy, government at all degrees, expert institutions, and business have failed. a few of the 35 OECD international locations, we’ve got the maximum productive and green agriculture industry. sadly, our healthcare enterprise is the least efficient amongst those countries and, https://www.dissertationking.co.uk/ via some requirements (eg maternal mortality), the least powerful.

Member

I have designed incentive employee compensation systems. It is a given those subjected to it will try and game the system….with unintended consequences. You have to watch that carefully. Unfortunately, our health policy experts (even when they are well intentioned corporate representatives) don’t want to recognize that metrics/transparency can backfire.

My conviction (supported by the large Rand Corporation study of HSA plans) is that we won’t see value improvement in health care unless patients have an opportunity to directly financially benefit from prudent and wise use of health services. Almost all our policy experts discount this and remain committed to top down centralized schemes that haven’t worked and have cost hundreds of billions….and even denial of treatment/high mortality as Koka has described.

We have to be skeptical of our health policy experts. As said by Daniel Kahneman in Thinking Fast and Slow “those with most knowledge are often less reliable. The reason is that the person ….develops an enhanced illusion of her skill and becomes unrealistically overconfident.” page 219

Member
Allan
Oct 17, 2017

“My conviction (supported by the large Rand Corporation study of HSA plans) is that we won’t see value improvement in health care unless patients have an opportunity to directly financially benefit from prudent and wise use of health services.”

Paul, you have the key, but those in power don’t want to give much of it to the patient.

Member
Oct 17, 2017

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Member
Oct 17, 2017

Good work Dr. Koka! Love the example Surgery Center of OK is setting. May we all be as visionary as they are.

Member
limbicdoc
Oct 16, 2017

Great article. I thought sc heparin upon admission and daily while in the hospital contributed to the significant drop in DVT and PE or embolic stroke in those with a PFO.

Member
pjnelson
Oct 16, 2017

I join the chorus, “well-said!” Historically, the only time in the last 25 years that health spending did NOT increase faster than economic growth was from 1994 through 1999. See health spending reports at http://www.altarum.com The excesses of the HMO era did apparently restrain Parkinson’s Law. When the HMO presence disappeared, there was a huge rebound in our nation’s health spending with annual increases above economic growth from 2001 to 2004. Think about it.
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I have slowly, but now firmly, come to understand that health spending has increased substantially as a reflection of the social adversities that impact the lives of many people, especially those with essentially no disposable resources. The worsening levels of obesity, young adult suicide/homicide mortality, opiate/gambling addiction, social mobility that is restricted by poverty, and the apparent declining connection of C-Suite governance and social responsibility — are all beyond the control of the front-line health professions. It is clear that our leaders within the Universities, philanthropy, government at all levels, professional institutions, and business have failed. Among the 35 OECD nations, we have the most productive and efficient agriculture industry. Sadly, our healthcare industry is the least efficient among these nations and, by some standards (eg maternal mortality), the least effective.

Member
Allan
Oct 16, 2017

What can one say other than … Good Job, but how do we extricate ourselves from the monsters we have created?