# Presentation: 560282

## Increasing the value of Medicare

- Mark E. Miller, Executive Director
- Sharon Bee Cheng, Senior Analyst
- April 26, 2007

## Moving toward value based purchasing

- Current system is misaligned for efficiency, or for patient-centeredness
- Pay for performance can change some incentives, encourage IT
- Care coordination

## Why are incentives important in Medicare?

- Current payment system is neutral or negative towards quality
- Beneficiaries are some of the sickest and most vulnerable
- IOM included Medicare as part of its national quality agenda
- Largest single purchaser

## MedPAC’s actions

- June 2003: Recommended financial incentives should be used to improve quality
- Established criteria for which settings are ready
- March 2004: Dialysis physicians and facilities and Medicare Advantage plans meet P4P criteria
- March 2005: Inpatient acute hospitals, physicians, and home health agencies meet P4P criteria
- March 2005: Include measures of IT functionality in P4P programs

## A model for P4P in home health

- Begins with a pool of funds withheld
- Measure outcomes and adverse events
- Set a national benchmark
- Test each agency’s attainment against the benchmark and its improvement over time
- Assign rewards and penalties

## Home health P4P and IT

- Tele health can decrease potentially avoidable use of the hospital
- Process measures
- Fall prevention
- Wound care
- Patient experience

**Notes:**
Briggs study looked at strategies to reduce National quality improvement hospitalization reduction study
10 percent of agencies who were best at reducing hospitalizations
  identified all strategies used
Among most prevalent strategies:
24 hour availability of agency nurse by telephone
Using data bases to develop evidence and shape care plans:  integrate health IT is day to day functions

Tele health:  Was the least diffuse among the top 15 strategies fewer than 10 of the top agencies used it  Industry study showed that telemonitoring could help CHF and COPd and other chrinic conditions

Fall prevention process was to integrate prompts to plan appopriate follow up in the care assessment tool could be done with paper or with handheld

Wound care includes storing a digital image of wound to track its progress and share with Wound care nurse or PHYSICIAN

Patients tend to have high levels of satisfaction with telehealth

## Home health and remote health care

- A home health agency may furnish services via a telecommunications system if they do not substitute for in-person services
- Must be in physician ordered plan of care
- Do NOT count toward visit minimums

## Information technology: Summary

- IT has considerable potential
- Use low, but increasing
- Significant barriers to adoption
- Actions to accelerate adoption
- Be aware of constraints
- Make recommendations that complement efforts already underway

**Notes:**
I am going to summarize our discussion on actions that could accelerate diffusion of IT.  This slide provides background to that discussion.  Briefly, we have found that:
There is limited, but suggestive evidence linking use of IT to improved quality
As Karen discussed this morning, IT could greatly enhance our ability to measure quality.
There are some links to improved efficiency for providers and the health system as a whole. And,
Use of IT could greatly improve the ability to coordinate care across settings by facilitating information exchange.

Despite the potential of IT, we know that diffusion is low, but growing.  This is partly due to the significant barriers to adoption, which include cost, the difficulty of successful implementation, and misaligned financial incentives.

Given what we know about the potential benefits of IT and the barriers to adoption, what could be done to accelerate diffusion?
As we addressed that question, we kept in mind the constraints on further action, which include the riskiness of IT investment, the need to avoid unintended consequences, and the fiscal realities discussed in our context chapter.
When considering possible recommendations, we kept in mind the considerable efforts already underway in both the private and public sector and sought to complement those activities, rather than duplicate them.

## P4P and IT

-    Congress should direct CMS to include measures of functions supported by the use of information technology in Medicare initiatives to financially reward providers on the basis of quality.

**Notes:**
Here is our recommendation on pay for performance, which reads:
Congress should direct CMS to include measures of functions supported by the use of information technology in Medicare initiatives to financially reward providers on the basis of quality.
No impact on spending.
For beneficiaries, we expect improve quality of care.
For providers, there could be some redistribution of payments.
The kinds of measures we are talking about focus on quality-enhancing functions that are supported by IT, rather than on the tool itself.  One example would be tracking diabetic patients and sending them reminders about preventive care.
This recommendation recognizes that P4P will incentivize IT adoption in 3 ways:
By including measures that are supported by IT use.
By holding out the incentive of additional quality payments for those who do well on those measures, and thereby building the business case for IT. 
By making it easier to measure and report quality.
We decided it was important to be explicit about the inclusion of IT-related measures in pay for performance for two reasons: its potential to accelerate adoption of IT and the importance of IT for enhancing our ability to measure quality.  That is why we have a separate recommendation.  In addition, we feel that eventually all sectors will benefit from greater IT use; therefore, this recommendation applies to all settings in which there is a p4p program.
We state in the text, however, that is is important to include IT-related measures in the physician sector from the beginning, as has been done in many private-sector P4P initiatives.  We also note that as IT use grows, measures of IT use itself could be included, as could measure of electronic exchange of information across settings.

## Examples of functionality

- Registry for patients with chronic conditions
- System tracks test results and prompts follow up of abnormal results
- System notifies patient of lab results
- System aggregates, measures, and monitors pts by disease, medication, or other category

**Notes:**
IT functionality used in one of nation’s largest doc P4P programs in IHA California
Integration of electronic clinical datasets  such as pt. registry
Point of Care technology 
eprescribing and 
access notes of other docs
Physciain rcv prevenetative and chron care reminders electronically

## Why is care coordination needed?

- Beneficiaries see multiple providers in an episode
- Prevalence of chronic conditions increasing
- Many with chronic conditions:
- Are high proportion of Medicare expenditures
- Are not receiving high quality care

## Health system and payment not designed to promote care coordination

- Current FFS payment design focuses on:
- Acute illness and injury; not care planning over time
- Individual providers; not patient care across settings
- Face-to-face reimbursement; not self-management training, or ongoing monitoring
- Limited physician time and training for care coordination
- Clinical information systems not widely used  by health system

**Notes:**
Primary tools
Care manager (usually a nurse): monitors patient progress, and educates patients for self-management (symptoms, medication use, life-style change) 
Information system: to identify most needy patients, track progress and share information 
Physician office involvement improves program effectiveness
Payments to programs usually risk-based
Programs usually target complex patients, often w/multiple chronic conditions 
Costs savings vary
Type of patient
Intervention
Time frame
Quality improves

## Issues in care coordination in Medicare

- How to organize the care?
- What is an appropriate payment model?
- Who is eligible?
- Organizations
- Providers
- Beneficiaries
- How can organizations be held accountable?