June 19, 2018
How to Optimize Healthcare Benefits
The need for quality measures presents an opportunity for trusted advisers to design benefits plans to optimize for value.
Based on the trend toward value-based health insurance and reimbursement, health benefit plans are being designed to reduce barriers to maintaining and improving health and to promote higher-value healthcare services.
Value-based reimbursement requires providers to track and report a host of adverse events and population health measures, including biometrics, patient engagement and other measures required to demonstrate quality performance. Unlike the traditional fee-for-service model, value-based care attempts to align incentives of providers to deliver the right care in the right setting in lieu of maximizing the revenue of each encounter by delivering more services.
Providers receive incentives to use standardized, evidence-based medicine, engage patients, upgrade health IT and use more advanced data analytics to optimize their clinical and financial performance. When patients receive more coordinated, appropriate and effective care, providers are rewarded.
Accessing Care Quality and Safety Data
Plan sponsors and their benefits consultants or brokers who advise them need access to information about care cost, along with the quality and safety performance of those hospitals and physicians delivering care to their plan members.
See also: Taming of the Skew in Healthcare Data
Quality measures are essential in optimizing the benefits of value-based models for all stakeholders. Success for all stakeholders depends upon how well healthcare providers can manage quality of care within tighter financial parameters.
This presents an opportunity for benefits consultants and brokers who are well-positioned to act as trusted advisers in educating and defining how best to design benefits plans to optimize for value. As educators and advocates, they can guide plan sponsors toward partners who will help them evaluate provider quality and safety.
Research shows that many U.S. employers that offer health insurance to employees are unfamiliar with objective metrics of health plan quality information. This gives benefits consultants and brokers an opportunity to outline the advantages of evaluating hospital quality to ensure that plan designs and benefits options include only high-quality hospitals and physicians who provide services at the lowest costs and encourage plan members through incentives to avail themselves to this narrower group of providers.
The Challenge: Hospital Ranking Variability
The significant challenge is the prevalence of numerous hospital quality rating methodologies. Even the slightest differences in adjustment methodology, data source, time period and inclusion/exclusion rules can produce differences in the hospital or physician ratings. This variation makes it more difficult for hospitals and physicians to prioritize and improve the quality of care delivered.
For instance, hospital ranking organizations, such as U.S. News & World Report, Healthgrades, Centers for Medicare and Medicaid Services (CMS) and Leapfrog, reflect substantially different results, fostering confusion to those less literate in healthcare analytics. In 2016, CMS gave 102 hospitals its top rating of five stars, but only a few of those were considered as the nation’s best by private ratings sources such as U.S. News & World Report or viewed as the most elite within the medical profession. First-tier academic journals like JAMA expressed deep concern about the lack of academic credibility in the methods used to assess performance and aggregate the conclusions into a single rating across many different measures.
Plan sponsors and their benefits consultants or brokers must educate themselves on assessing provider quality. While there is a myriad of rating services, many do not include elements essential to a precise and comprehensive assessment of providers.
See also: Healthcare Data: The Art and the Science
Ratings approaches that use reputation or self-reported data should be considered less reliable than objective outcomes measures using patient level claims data. Additionally, hospital overall surveys or patient reported outcomes do not offer a valid basis for comparison. It is also not possible to use a single outcome measure – for example, risk-adjusted mortality — as a proxy for all outcomes like complications or readmissions because provider performance varies widely across measures. For a comprehensive assessment, all available measures should be incorporated for a specific clinical category. Lastly, aggregating outcomes data into composite scores must be scientifically sound.
As more employers seek greater value for their healthcare dollars, and as benefits consultants and brokers continue to pursue opportunities to help them reduce the upward cost spiral, quality ratings are an important first step toward realizing these goals and advancing the quest for improved employee health.