pay for performance: have expectations exceeded outcomes?

Venture Advisory Services Venture Advisory Services © 2008 Venture Advisory Services, All Rights Reserved.© 2008 Venture Advisory Services, All Rights Reserved.

Pay for Performance:Pay for Performance:Have Expectations Have Expectations

Exceeded Outcomes?Exceeded Outcomes?

Pay for Performance:Pay for Performance:Have Expectations Have Expectations

Exceeded Outcomes?Exceeded Outcomes?

A Review of National Trends and Future Directions

Geof Baker, PrincipalVenture Advisory Services


AgendaAgenda

National Context

Lessons Learned

Release 3.0National Context

2

Venture Advisory Services Venture Advisory Services © 2008 Venture Advisory Services, All Rights Reserved.© 2008 Venture Advisory Services, All Rights Reserved. 3

39

5 10 6

59

84

6 8 13 7

73

10 725

15

91

160

4

107

148

Other Government MedicaidOnly Plans

Employers CommercialHealth Plans

Total All P4P

Nov-03Nov-04Nov-05Nov-07Nov-09 (Proj)

Growth in P4P Programs by Sponsor Type (2003 -2009E)

Source: Med-Vantage-Leapfrog 2006 National Survey with 2007 Market Updates

Note: For “Other” in 2007, included disease management programs and vendors with P4P incentives under the primary program sponsor (Medicaid) and 10 projected implementations .

P4P Market Adoption Has Matured P4P Market Adoption Has Matured P4P Market Adoption Has Matured P4P Market Adoption Has Matured


P4P Incentives Extend to All Providers P4P Incentives Extend to All Providers P4P Incentives Extend to All Providers P4P Incentives Extend to All Providers

P4P Program by Provider Type: 2003-2007 Trend

12

6349

108

220

7156

256

1129

52

120

63

2433

129

0

25

50

75

100

125

150

175

200

225

250

275

Specialist Facility PCP Practice Total P4P Programs

Nu

mb

er

of

P4

P P

rog

ram

s

Base (2003) 2004 2005 2007

# of Programs by P4P Sponsor 2007 (n=138), % of Total

60, 43%

49, 36%

29, 21%

1 P4P Program 2 P4P Programs 3 Programs (PCP, Specialist, Facility)

`

Source: Med-Vantage-Leapfrog 2006 National Survey with 2007 Market Updates

Venture Advisory Services Venture Advisory Services © 2008 Venture Advisory Services, All Rights Reserved.© 2008 Venture Advisory Services, All Rights Reserved.5

1st Generation (1996-2004)

3rd Generation (2008-2010)

2nd Generation (2005-2007)

Policy National Attention Measure Leadership Performance Measurement & Evidence Stewardship

Growth & Sponsors

•Early Adopters - •Early Majority (Plans – HMO Product)

Late Majority (Plans, CMS, Employers)

• Laggards – Mature• Broad Market Adoption (CMS,

Medicaid)

ROI “Next Wave”, Anecdotal ROI. Focus on UM measures and Rx generic substitution to save $$.

• “Not a Panacea.” Signs of progress: positive clinical improvement with diminishing returns.

• Mixed results from evaluative studies (RWJ, CMS). Confounding factors.

• Cost increases initially for deferred preventative care.

• Achieve dramatic reductions in misuse, overuse, underuse and preventable errors.

• Broad adoption of Erx, generic substitution @70%

• Additional ROI Studies. Adoption of other payment models that complement P4P.

No #, Type of KPIs

≈ 25 measures: PCP HEDIS, utilization, hospital chart, patient experience.

≈ 100 measures: specialty focus, process, structure, safety, HIT adoption, patient experience.

≈ 200 measures composite, outcome, & process measures. HIT adoption, risk adjust, health disparities, multi-disease states.

The P4P Evolution RoadmapThe P4P Evolution RoadmapThe P4P Evolution RoadmapThe P4P Evolution Roadmap

Venture Advisory Services Venture Advisory Services © 2008 Venture Advisory Services, All Rights Reserved.© 2008 Venture Advisory Services, All Rights Reserved.6

1st Generation (1996-2004)

3rd Generation (2008-2010)

2nd Generation (2005-2007)

Data Source Claims, chart (hosp) Claims, some lab, Chart (hosp) Enhanced data collection (PQRI, PHR, EHR) + admin data.

Data Aggregation

Minimal Burdensome data collection, some aggregation

Multi-payor, single platforms. clinical data exchanges (HIE). Medical practice integration using IT.

Payment Method and Amounts

• Withhold or Bonus based payouts

• Threshold & ranking based performance

• .5-1% Hospital payout• 2-5% PCP payout

• Differential fee schedules & bonus.

• Threshold based & relative improvement performance

• 1-2% Hospital payout• 2-15% MD payout

• Differential fee schedules, value based payments.

• Relative improvement, exception reviews

• ≥ 10% Hospital & MD payout

Integration with other Initiatives

Stand alone Public reporting, Tiered Networks, HIT adoption

Programs complementing P4P, patient /member incentives & engagement

Reporting Annual retrospective Quarterly retrospective Point-of-care interventions (alerts, reminders)

The P4P Evolution RoadmapThe P4P Evolution RoadmapThe P4P Evolution RoadmapThe P4P Evolution Roadmap


Pay forPerformance

StandardsInteroperability

Data Aggregation

Tiered Networks

Payment reformValue Based Benefit Design

HIT Adoption- HIE, Erx, EHR

Pay-for-ReportingPay-for-Process- Data Quality

IntegratedCare Management

Public ReportingTransparencyRecognition

Medical HomeProvider EngagementBest Practices

P4P Complements Other InitiativesP4P Complements Other InitiativesP4P Complements Other InitiativesP4P Complements Other Initiatives

7


Reasons for Implementing P4P ProgramsReasons for Implementing P4P Programs

Using a scale from 1-5, where 1 equals NOT important and 5 equals VERY important

Criteria for Implementing P4PMean2006

(n=62)

Mean2005

(n=60)

Mean2004

(n=50)

Improve patients’ clinical outcomes 4.63 4.36 4.60

Improve member experience (e.g., patient satisfaction)

4.00 N/A N/A

Differentiate in the market, convey positive image

4.00 3.62 3.64

Drive standardization of performance measures

3.93 N/A N/A

Align with other initiatives (e.g., disease management, high performance networks, consumer-directed benefit designs, consumer-directed provider report cards)

3.75 3.57 4.02

Reduce medical errors/improve patient safety

3.63 3.3 3.68

Improve bottom line, lower cost 3.53 3.24 3.28

Improve data collection and reporting from providers

3.53 2.99 3.44

Respond to employer pressures 3.14 2.74 2.87

Source: 2007 Med-Vantage/Leapfrog P4P Survey


National Context

Lessons Learned

Release 3.0Findings &

Lessons Learned


Inherent Limitations ….But Here to StayInherent Limitations ….But Here to StayInherent Limitations ….But Here to StayInherent Limitations ….But Here to Stay

Rewards Integrated with Other InitiativesBand-Aid

P4P payments > 10%, frequency to reinforce changeInsufficient Motivation

All payer & aggregated data, uniform platforms with regional exchanges to increase sample size

Critical Mass

Outcomes/composite measures, opportunity areas, CQI culture, engage MDs, assisted interventions

Diminishing Returns

Exception reporting, risk adjustmentGaming

Some +gains, few wind-ups, requires iterations & reengineering, cost of care/outcome measures

ROI Unknown


Many Use P4P as a Strategy to Achieve ChangeMany Use P4P as a Strategy to Achieve Change


Inherent Limitations ….But Here to StayInherent Limitations ….But Here to StayInherent Limitations ….But Here to StayInherent Limitations ….But Here to Stay

Relative improvement payout modelsBias

Demographic adjustment requiredHealth Disparities

Value based benefit design, patient health rewards

Quarterly reporting, point-of-care interventions

Patient Accountability

Data integrity, patient attribution, standards, clinical data exchanges, direct data submission, chart data

Latency

Single Source of Truth

Uniform measure sets, coordinated programs, HITBurdensome


• Direct data submission (supplement claims with collection of

clinical values from registries or EHRs, lab)

• Multiple submission methods (secure sign-on, electronic)

• Standardized data field definitions

• All payer aggregation of admin data (claims, rx)

• Immediate validation / integrity checks

• Auditing and QA (correct coding)

• Help desk and training support,

• Models: IHA, MHQP, BTE, MN, BQI / Charter Value Exchange

• Multiple attribution models - what are the intended purposes?

Data Submission & IntegrityData Submission & Integrity


National Context

Lessons Learned

Release 3.0Next Generation

Release 3.0


Changes anticipated in next 2 years to P4P Program2006

Percent(n=46)

2005Percent(n=82)

Expand program to include other products (e.g. PPO, ASO, CDH)

20% 40%

Expand program to include specialists if not doing so now 33% 40%

Expand program to include additional specialties 26% 35%

Expand program to include hospitals if not doing so now 24% 27%

Expand the scope or number of measures used 70% N/A

Change the performance domains or relative weighting 39% 67%

Develop a public performance report 33% 43%

Tie the P4P program more closely to disease management, tiered networks, or benefit design initiatives

33% N/A

Discontinue the program 0% N/A

Other 27% 21%Data Aggregation – Participation in state-wide, collaborative quality initiatives

Data Aggregation – Participation in state-wide, collaborative quality initiatives

Anticipated Changes in P4P ProgramsAnticipated Changes in P4P Programs

Source: Med-Vantage-Leapfrog, 2006 National Survey with 2007 Market Updates


• CMS is now in business, More $ to incent sustained change

• Strategy to achieve change and sustain CQI

• Going beyond process measures with diminishing returns - Clinical

measure impact must be demonstrable and focused

• Integration with other initiatives - HIT adoption (ERx), Medical Home,

Cost of Care (Are we reducing trends yet?), Health Rewards

• Methodology: full disclosure & open standards (nyrxreport.ncqa.org)

• Physicians acting upon “actionable information” at point-of-care

• Data aggregation, clinical exchange, clinical values, enhanced collection

• Strong push for transparency

Road Ahead: Key Trends for P4PRoad Ahead: Key Trends for P4P

pay for performance: have expectations exceeded outcomes?

Documents