The economics of American healthcare is undergoing a profound shift. Employers, policymakers and other purchasers are increasingly paying healthcare providers based on the benefit to the patient. For instance, the Centers for Medicare and Medicaid Services, (CMS) the agency that runs Medicare, adjusts payments to hospitals based on how well they perform on measures of patient experience, readmissions and patient safety. Private payers, too, are increasingly negotiating contracts tied to quality and safety performance.
Understandably, the changes to payment heighten sensitivity among hospitals and doctors about how their performance is measured. Even measures that have been exhaustively tested and validated face new levels of scrutiny when money is on the table. Many providers even call for delaying the changes in payment until measures can be perfected even more.
But employers and other purchasers of healthcare are determined to move forward with new payment standards without delay and will not await measurement perfection. After decades of enormous investment in healthcare with little or no accountability for quality, purchasers place a high value on understanding quality and don’t intend to reverse course and continue simply paying for everything. Employers and purchasers do not intend to return to the days when consumers had no information to make an all-important decision about which hospital to use, and purchasers paid the bill regardless of the quality of the patient experience. Purchasers want numbers, figures and rates on safety, quality and cost, calculated with vigilance, responsibility and respect for science. After decades of hard work and research, this is finally available to them.
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Transparency has been the key to change. According to a multi-stakeholder roundtable convened by the Lucian Leape Institute of the National Patient Safety Foundation in 2015, “During the course of healthcare’s patient safety and quality movements, the impact of transparency – the free, uninhibited flow of information that is open to the scrutiny of others – has been far more positive than many had anticipated, and the harms of transparency have been far fewer than many had feared.” The effect is so dramatic, the report concluded, that “if transparency were a medication, it would be a blockbuster.”
The report cited my organization Leapfrog’s first-ever reporting of a measure of maternity care, early elective deliveries. These are deliveries scheduled early without a medical reason, and they pose risks to the mother and the baby, and frequently result in babies unnecessarily starting life in the neonatal intensive care unit. There had been many efforts in the past to curtail these unsafe deliveries, but it wasn’t until Leapfrog publicly reported rates by hospital that significant progress was made. In just five years, the national mean dropped from 17% to 2.8%.
Transparency has also accelerated reductions in errors and accidents that kill or harm patients in hospitals. The 2014 estimates from the federal Agency for Healthcare Research and Quality’s Medicare Patient Safety Monitoring System, which reports patient safety indicators, show progress in reducing hospital-acquired conditions, including a drop from 28,000 inpatient venous thromboembolisms in 2010 to 16,000 in 2014. This means 12,000 fewer patients in 2014 developing potentially fatal blood clots. It is very unlikely that we would have achieved a reduction of this magnitude without transparency.
Measurement and transparency do not have to be perfect to achieve remarkable progress in quality improvement. We see this in more transparent industries outside of healthcare every day. For instance, researchers studied the recent initiative in Los Angeles to issue safety grades rating the hygiene of restaurants and found it associated with a nearly 20% decline in hospitalizations from foodborne illness in the program’s first year. The composite grade used in LA was fairly rudimentary by the standards of measurement scientists in the healthcare industry, but the grade was nonetheless effective in educating consumers and galvanizing improvement.
Providers and health care executives sometimes point to flaws in their medical record and billing systems as problems that should delay the use of certain measures. However, public reporting is often necessary to break logjams in data collection. For instance, New York state’s public release of surgical mortality data for coronary artery bypass grafting procedures jump-started the movement to define and more carefully collect the procedure outcome data. Providers will get better at data collection when the data is used.
Current healthcare performance measures may not be perfect, but good people are working hard to steadily improve their validity – and that work should be done in the sunlight of transparency. Employers will gladly work collaboratively toward that end, as long as the work continues without delay. We have all waited too long for transparency and sensible payment, and the cost in human lives and suffering is already too high.