California Pay for Performance

Dolores Yanagihara, MPHIntegrated Healthcare Association

Mendocino Health Information ExchangeJune 18, 2008

2

Agenda

• California P4P Program information• P4P Results

– Performance– Public Reporting– Payment– Stakeholder Feedback

• Overcoming Program Challenges– Technical– Political / Legal

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Integrated Healthcare Association (IHA)

• Statewide leadership group that promotes quality improvement, accountability, and affordability of health care in California

• Mission: to create breakthrough improvements in health care services for Californians through collaboration among key stakeholders

• Principal projects:– pay for performance– medical technology assessment and purchasing– measurement and reward of efficiency in health care– prevention programs directed at obesity

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Background

Institute of Medicine (IOM) reports a call to action to improve quality and safety of U.S. healthcare with specific recommendations including:

• Quality measurement and reporting

• Public Transparency

• Incentives for quality improvement (Pay for Performance)

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California P4P: History

• 2000: Stakeholder discussions started

• 2002: Testing year– IHA received CHCF Rewarding Results Grant

• 2003: First measurement year

• 2004: First reporting and payment year

• 2008: Sixth measurement year; fifth reporting and payment year

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The California P4P Players

• 8 health plansAetna, Blue Cross, Blue Shield, Cigna, Health

Net, Kaiser, PacifiCare, Western Health Advantage

• 40,000 physicians in 235 physician groups

• HMO commercial membersPayout: 5.5 millionPublic reporting: 11 million*

* Kaiser medical groups participate in public reporting only starting 2005

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Program Governance

• Steering Committee – determine strategy, set policy• Planning Committee – overall program direction• Technical Committees – develop measure set• Payment Committee – recommend payment method• IHA – facilitates governance/project management• Sub-contractors

NCQA/DDD – data collection and aggregationNCQA/PBGH – technical supportThomson – efficiency measurement

Multi-stakeholders “own” the program

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Goal of California P4P

To create a compelling set of incentives that will drive breakthrough improvements in clinical quality and the patient experience through:

√ Common set of measures √ Data aggregation√ A public report card√ Health plan payments

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Organizing Principles• Measures must be valid, accurate, meaningful to

consumers, important to public health in CA, economical to collect (admin data), stable, and get harder over time

• New measures are tested and put out for stakeholder comment prior to adoption

• Data collection is electronic only (no chart review)

• Data from all participating health plans is aggregated to create a total patient population for each physician group

• Reporting and payment at physician group level

• Financial incentives are paid directly by health plans to physician groups

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The California P4P Process

TestingYear

MeasurementYear

Data Aggregationand Payments

Public Comment Reporting

Year

Development Year

Public Comment

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MY 2008 Clinical Measures• Acute Care

Treatment for Children with Upper Respiratory Infection

Appropriate Testing for Children with Pharyngitis

Avoidance of Antibiotic Treatment in Adults with Acute Bronchitis

Use of Imaging Studies for Low Back Pain

• Preventive Care Breast Cancer Screening Cervical Cancer Screening Childhood Immunizations Chlamydia Screening Colorectal Cancer Screening

• Chronic Disease Care Appropriate Meds for Persons

with Asthma Cholesterol Mgmt: LDL

Screening & Control <100 Monitoring of Patients on

Persistent Medication

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MY 2008 Patient Experience Measures

• Specialty Care

• Timely Care and Service composite

• Doctor-Patient Interaction composite

• Care Coordination composite

• Overall Ratings of Care

• Office Staff composite

• Health Promotion composite

13

MY 2008 IT-Enabled “Systemness” Domain

1. Data Integration for Population Management

2. Electronic Clinical Decision Support at the Point of Care

3. Care Management• Coordination with practitioners• Chronic care management processes• Continuity of care after hospitalization

4. Access and Communication Standards

5. Physician Measurement and Reporting

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New Domain for MY 2008

Coordinated Diabetes Care Domain– Diabetes Clinical Measures

• HbA1c screening, poor control >9, good control <7• LDL screening, control <100• Nephropathy Monitoring

– Diabetes Population Management Activities • Diabetes Registry (including blood pressure)• Actionable Reports on Diabetes care• Individual Physician Reporting on Diabetes measures

– Diabetes Care Management

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New Measures for “Testing” in 2008

• Test in 2008 for potential inclusion in MY 2009

• Clinical– Depression Screening and Assessment of High Risk

Patients

– Inpatient Readmissions within 30 Days

– Asthma Medication Ratio

– Evidence-based Cervical Cancer Screening (re-test)

– Potentially Avoidable Hospitalization (re-specify and re-test)

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Efficiency Measurement

• Purchasers and Health Plans are demanding that cost be included in the equation

Quality + Cost = Value

• Use both population-based and episode-based methodologies

• Use both standardized costs and actual costs to account for utilization and pricing

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Efficiency Measures

1. Generic prescribing (MY 2007)

• Calculated by cost and by number of scripts

2. Overall Group Efficiency (MY 2009)

• Episode and population based methodologies • Calculated using both standardized and actual costs

3. Efficiency by Clinical Area (MY 2009)• Calculated using standardized costs

4. Actual to Standardized Pricing Indices (MY 2009)

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Plans

OR

Group

CCHRI

Group

ClinicalMeasures

IT-EnabledSystemness Measures

PatientExperienceMeasures

Audited rates using

Admin data

Audited rates using

Admin data

PASScores

Survey Toolsand

Documentation

Data Aggregator: NCQA/DDD

Produces one set of scores

per Group

Physician

GroupReport for QI

HealthPlan

Report for Payment

ReportCard

Vendor forPublic

Reporting

CA P4P Data Collection & Aggregation

EfficiencyMeasures

Vendor/Partner: Thomson (Medstat)

Produces one set of efficiency scores

per Group

PlansClaims/encounter data files

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Aggregating Data

Benefits:• Increase sample size

– More reportable data– More robust and reliable results

• Measure total patient population• Produce standardized, consistent performance

information

Requirements:• Consistent unit of measurement• Standard, specified measures

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The Power of Data AggregationAggregating data across plans creates a larger denominator and allows valid reporting and payment for more groups

Health Plan Size

# of Health Plans

% physician groups with sufficient sample size to

report all clinical measures using

Plan Data Only

% physician groups with sufficient sample size to

report all clinical measures using the Aggregated Dataset

< 500K members 3 16% 70%>1M members 4 30% 65%

P4P Results

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Overview of P4P Program Results

• Year over year improvement across all measure domains and measures

• Single public report card through state agency (Office of the Patient Advocate)

• Incentive payments totaling over $210 million for measurement years (MY) 2003-2006

• Physician groups highly engaged and generally supportive

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Clinical Results MY 2003-2006

0

10

20

30

40

50

60

70

80

90

Breast CancerScreening

Cervical CancerScreening

HbA1c Screening ChlamydiaScreening

ChildhoodImmunizations

MY 2003 MY 2004 MY 2005 MY 2006

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Regional Variation in Clinical Performance

50

55

60

65

70

75

80

85

90

Inland Empire

Los Angeles

Central Coast

Central Valley

San Diego

Orange County

Bay Area

Sacramento/North

Statewide

MY 2006 Results by Region

Top Performing Groups

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IT Measure 1: Population Management Activities

0

10

20

30

40

50

60

Patient Registry Actionable Reports HEDIS Results

Percentageof Groups

MY 2003 MY 2004 MY 2005 MY 2006

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IT Measure 2:Point-of-Care Activities

0

5

10

15

20

25

30

35

40

45

Electronic

Prescribing

Electronic

Check ofPrescription

Interaction

Electronic

Retrieval ofLab Results

Electronic

Access ofClinical

Notes

Electronic

Retrieval ofPatient

Reminders

Accessing

ClinicalFindings

Electronic

Messaging

MY 2003 MY 2004 MY 2005 MY 2006Percentage of Groups

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Correlation Between IT Adoption and Clinical Performance

50

55

60

65

70

75

80

Clinical Score

No IT Adoption Full IT Credit

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Public Report Cardhttp://opa.ca.gov/report_card/medicalgroupcounty.aspx

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Health Plan Payment Results

• Each health plan determines their own reward methodology and payment amount (http://www.iha.org/ftransp.htm)

• Most plans pay on relative performance, after meeting thresholds

• $38 M paid out in 2004• $54 M paid out in 2005• $55 M paid out in 2006 • $65 M paid out in 2007 (about 1.5-2% of base pay on average)

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Paying for Performance & Improvement

Earning Quality Points ExampleMeasure: Pneumococcal Vaccination

Attainment Threshold.47

Benchmark.87

Attainment Threshold.47

Benchmark.87

Attainment Range

performance

Hospital I

baseline•.21

.70•

Attainment Range1 2 3 4 5 6 7 8 9

Attainment Range1 2 3 4 5 6 7 8 9

Hospital I Earns: 6 points for attainment7 points for improvement

Hospital I Score: maximum of attainment or improvement= 7 points on this measure

Improvement Range1 2 3 4 5 6 7 8 9• • • • • • • • •

• • • • • •• • •

Score

Score

Excerpt from CMS Hospital Value-Based Purchasing Listening Session #2, April 12, 2007

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Physician Group Engagement

Program Strengths – Physician groups are highly engaged– 74% believe the measures are reasonable– Widespread support for increased incentives– Belief the program has increased the focus on quality

improvement and IT capabilities

Program Weaknesses– Lack of consumer interest in public reporting– Concern about the potential for too many measures

Overall Rating– Mean score of 3.86 for importance (on a 1 to 5 scale)

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Health Plan Engagement

Program Strengths– Increased collaboration– Push toward QI– Investments in IT– Greater accountability and transparency

Program Weaknesses– Improvements viewed as marginal– Concerns about “teaching to the test”– Lack of a positive ROI– Failure of clinical data feed to raise HEDIS scores

Overall Rating - 2.5 mean score (1 to 5 pt. scale)

Overcoming Program Challenges

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The Data Problem

The data you want:

• Easy to collect• Clinically rich• Complete and consistent• Across product lines/payors• Whole eligible population

Claims Data

Y

N

N

N

Y

PaperMedical Record

N

Y

Y?

Y

N

Electronic Medical Record

Y?

Y

Y

Y

Y

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Addressing the Data Problem

Enhancing claims data

• Identify and address data gaps • Encourage use of CPT-II codes• Develop supplemental clinical data

– Lab results– Preventive care / chronic disease registries– Exclusion databases

• Push EMR adoption

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Addressing the Data Problem

Example: Blood pressure control

– Previously a chart review measure

– Creation of CPT-II codes allows administrative measurement

– Incentivize inclusion in registry Create system for routinely collecting information

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Data Exchange

• Standard format and data definitions

• Defined data flow process

• Enhanced member matching

• Adequate documentation

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Data Exchange Issues

LDL<130 Rates - Diabetes Population NAdmin-

Only MeanAll-Data

Mean

National HEDIS Rates, MY 2003 313 25 59.8

P4P Plan HEDIS Rates, MY 2003 7 8.4 60

P4P Plan-Specific Rates, MY 2004  

Plan 1 (not used in aggregation)   0.0  

Plan 2 (not used in aggregation)   0.5  

Plan 3 (not used in aggregation)   1.0  

Plan 4 (not used in aggregation)   6.3  

Plan 5   21.4  

Plan 6   25.9  

Plan 7   26.3  

Self-Report Average   51.0  

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Intermediary

Physician Group

Third party lab data repository

Lab

Plan

Physician Group

Facilitating Data Exchange

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Legal and Political Issues

• Complying with HIPAA regulations

• Overcoming Non-Disclosure Agreements

• Addressing Data Ownership

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Addressing Legal and Political Issues

Example #1: Lab results– Code of Conduct for bi-directional data

exchange– Lab authorization form– Disease Management Coordination initiative

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Addressing Legal and Political Issues

Example #2: Efficiency measurement– BAA– Antitrust Counsel– Consent to Disclosure Agreements– No group-specific results shared first two

years– Publicly available sources of data

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Conclusions on Data Issues

• Data is a limiting factor in performance measurement

• Administrative data can be enhanced by supplemental sources

• Data transfer of supplemental sources needs to be standardized

• Aggregation can make results more robust

• Legal and political issues carry as much weight as technical issues

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Summary

• Initial process goals achieved

• “Breakthrough” outcome goal not achieved

• Strong collaborative “platform” established

• Fundamental changes in direction and implementation required to address emerging affordability goal

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California Pay for Performance

For more information:

www.iha.org

(510) 208-1740

Initial support for IHA Pay for Performance provided

by California Health Care Foundation