Value-Based Purchasing Initiatives Deserve a Break

Thursday, February 1, 2018 | Joel Sauer

A recent article in Cardiology News covered a study out of the Netherlands that reviewed 1.4 million Medicare patients’ claims data. The researchers found “no evidence that hospitals [that were] operating under pay for performance programs for more than a decade had better process scores or lower mortality than other hospitals.” Paraphrasing only slightly, the study concludes that these efforts make no difference in improving care for patients.

Really?!? I get the data, but I’m not buying it.

Here’s what I see. Even though Value-Based Purchasing (VBP) programs – a form of pay-for-performance – account for a relatively moderate risk when considered in terms of total Medicare reimbursements, cardiovascular programs have in response implemented significant infrastructures around them. The service line model is an example of this, as are physician co-management programs and the like. Additionally, there is much attention paid to these VBP metrics (no pun intended) within most organizations I visit. They show up on dashboards and on meeting agendas.

Because I have the privilege of seeing many different CV programs intimately each and every year, I know firsthand that improvements in care and, in particular, processes are indeed being made. They may not be precisely the ones that move the needle on mortality or VBP process scores (as noted in the study), but the improvements are real. As a past and most likely future consumer of CV service, I appreciate this – a lot!

Here may be a better conclusion from the data: improving mortality is really hard. It takes a series of improvement activities that build on each other and may ultimately result in better outcomes, like lower mortality. Each of these activities has to first identify a problem, then figure out what’s actually driving the current results. Having been part of these processes, I know how difficult this can be and how long it can take to identify the true levers of change.

I also know that programs are delivering on process improvements, things like clinical standardization development, appropriate use adherence, on-time starts and the like. While these may not sound all that glitzy, they have the ability to impact service and cost in a really big way. Speaking of costs, the study referenced didn’t look for any overall differences in Medicare spend over the VBP time horizon. To me, this is a big miss. As a patient, if I can get the exact same outcomes (think mortality) for less money, I’ll take that every day of the week. You may not have noticed, but healthcare is really expensive!

As noted above, great effort has been expended by CV programs across the country in response to a modest amount of reimbursement risk. While I won’t try to suggest that these initiatives only materialized because of payment threats, one has to admit the timing between the two is a bit coincidental. Certainly the VBP program didn’t blunt any improvement activities within our institutions.

Here’s the other thing. We had to start somewhere. For years and years attempts have been made to measure the quality and overall value of our healthcare. In almost every case we, as the provider community, rejected these attempts as inaccurate, off target, irrelevant and the list goes on and on. Meanwhile the cost curve just continued to bend upward – on a trajectory that eventually led to economic ruin. Today’s VBP metrics may not be the right ones and may not incent the right levers of change, but it sure got a lot of great things in motion and that by itself has some value.

Today’s VBP metrics may not be the right ones and may not incent the right levers of change, but it sure got a lot of great things in motion and that by itself has some value.

There have been some shining examples of provider-led quality initiatives, with cardiovascular medicine leading the way. The Society for Thoracic Surgery (STS) database was established almost 30 years ago, with the American College of Cardiology’s National Cardiology Data Registry (NCDR) coming on line more than 20 years ago.  Both of these came online decades before there were any incentives or penalties for outlying performance. 

We’ve also seen when new data become available that show where we’re off course, Medicare (and other payors) can change. I consider CMS’ reallocation of the weights around processes and outcomes a prime example of this. In a “be careful what you wish for” scenario, these registry data points have now (finally) been utilized by Medicare for quality measurement within its value-oriented reimbursement models. This is another sign that, though perhaps flawed out of the gate, positive changes can be made to move us in the right direction.

Value-based purchasing initiatives are far from perfect, and may have demonstrated dubious tangible results when looking simply at the data. However, when I consider the rapid development of performance improvement infrastructure within myriad programs around the country, I conclude VBP did exactly as intended. Our eye is definitely on the value ball.

Does VBP need to evolve? Absolutely, but we certainly can’t determine it has had no impact. That would be a dangerous conclusion . . . and we still have so far to go.

 

 

Joel Sauer, MBA, is Vice President of MedAxiom Consulting. Joel consults around the country in the area of value-oriented physician/hospital partnerships preparing health organizations for the value economy. His work includes vision and strategy setting, creating and implementing effective governance and leadership structures, co-management development, joint venture and other innovative partnerships, and provider compensation plan design. Beyond the above, Joel has a wealth of experience in service line development, clinical strategy development, provider workforce planning – including care team creation and physician slow-down policies, MACRA/QPP and bundled payment planning, and operational assessments. Contact Joel at [email protected].

 

 

 
Illustration: Lee Sauer

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MedAxiom Consulting is the nation’s leading cardiovascular-specific consulting group, working with a range of private practices, hospitals and health systems across the country to improve the delivery of CV health care. To learn more about our team, please visit our website.                     

 

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