Private sector P4P taking hold, expert says
Private sector P4P taking hold, expert says
Hospitals making progress, but public sector lags
Pay-for-performance structures have strongly taken root in the private sector, but progress in the public sector is "quite mixed," according to Richard Sorian, vice president of public policy, marketing, and external relations for the National Committee for Quality Assurance (NCQA). Sorian was the coordinator for an NCQA-sponsored meeting on December 1, 2006, in Washington, DC, entitled, "Pay for Performance: A Critical Examination." Speakers included representatives from NCQA, health plans, major corporations, health systems, insurance companies, health care organizations, federal agencies, and Congress.
Responding to a question posed by one of the sessions — "Is P4P ready for prime time?" — Sorian says, "I think the answer is yes when it comes to the private sector and commercial insurance. It has absolutely taken root and is more prevalent than anyone realizes." P4P, he notes, is "embedded in almost every health plan in the country."
He sees more of a mixed bag on the public side, mainly because Medicare has not yet been collecting performance information on physicians. A bill just signed by President Bush includes incentives for doctors to report on a small set of quality measures, but P4P is "nowhere near close" to prime time in this area, he maintains.
"On the hospital side we are much closer," says Sorian. "There has been pay for reporting for the last two-three years; information on virtually all 5,500 [Medicare] participating facilities have been reported out in aggregate form, but not in individual form."
He also notes the progress made in the Premier demonstration project, although it is not yet clear which model Medicare will ultimately adopt.
One area where the public sector appears to be ready and "has been for some time," according to Sorian, is the Medicare Advantage Program, which allows Medicare to go into private plans. "They've been reporting through HMOs and PPOs for 10 years," Sorian notes. "But as a country we do nothing to direct patients to the best plans — or the best hospitals within plans."
It is time, he says, for the program to move to P4P. "We have the data, and the knowledge from the private sector," he explains. "This is a real opportunity."
As for definitive proof that P4P really works, based on panelists' comments Sorian observes, "I would say the jury is still out. [Despite recent surveys,] we do not have longitudinal information that says real change has occurred as a result of these programs."
Many questions remain unanswered, he continues. "For example, do we just recognize and reward best performers — who likely would be the best performers no matter what?" Some programs in place today do just that, he notes.
"But there was a real interesting discussion at the conference about whether you should not only recognize top performers, but also establish a second set of awards for improvers," Sorian continues. This way, he notes, virtually all facilities have the potential to be rewarded.
"Another big question people are struggling with is, how much reward will it take?" he says. "If you're a small hospital in a rural community, a relatively small reward can produce big results. If you have very high costs, a small reward may not change your behavior much. There's a real question about what kind of awards it will take to create the kind of change we want."
What else is needed?
The NCQA program also examined what additional changes were needed to help P4P achieve its full potential. "For one thing, we need more data," Sorian observes. "Even in health plans, the most data collected is by HMOs; PPOs rarely are required to produce HEDIS data — and they represent 64% of all insured lives. It will take a lot of pushing to get PPOs involved."
There is definitely a need for more research on what kinds of rewards work, he continues. "And, there is a need for more experience, but we will get that naturally."
The biggest issue, says Sorian, and one that "everyone agreed on," is the need for more sweeping payment reform. "Our payment system — particularly in the public sector — continues to reward poor performance," he asserts. "In some ways, we actually penalize high quality care. Take overuse of services. In many cases, antibiotics have proved unnecessary, but if you are a hospital that practices in a certain way, you make income off that. The new P4P approach says we should provide less of those services and more of the less expensive stuff, like physical therapy — but are you really going to abandon that income to pick up a little reward? We really need to figure out how to deal with the over-utilization issue in our health care system."
For more information, contact Richard Sorian, Vice President of Public Policy, Marketing, and External Relations, National Committee for Quality Assurance, 2000 L St. NW, Suite 500, Washington, DC 20036. Phone: (202) 955-3500.
Pay-for-performance structures have strongly taken root in the private sector, but progress in the public sector is "quite mixed," according to Richard Sorian, vice president of public policy, marketing, and external relations for the National Committee for Quality Assurance (NCQA). Sorian was the coordinator for an NCQA-sponsored meeting on December 1, 2006, in Washington, DC, entitled, "Pay for Performance: A Critical Examination."Subscribe Now for Access
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