Stretching dollars without compromising care

Jan. 1, 2011

Two industry veterans lay out a pathway to physician-directed, best-practice improvements through comparative effectiveness research.

William C. Mohlenbrock
Thomas M. Kish

The economic challenges of the past decade have placed hospitals under unrelenting pressures to reduce costs while maintaining quality. With most of the stray dollars already found, any further cost-cutting initiatives will likely bring with them the danger of compromised quality of care.

How do healthcare organizations successfully respond to these challenges? They need new tools and new thinking; they need new ways to increase clinical quality and efficiencies. More than ever before, physicians are the key. The next stage of improvement must be a collaborative effort among physicians, clinical staff members and executives, working together to develop innovative ways to improve patient care.

This imperative for physician and hospital collaboration is felt most acutely in those hospitals where medical staff members are coming to the administration and requesting to become hospital employees. The burden of office overhead, personnel management and loss of ancillary services is driving physicians to become employees. But this actually presents an opportunity for innovative hospitals.

To take full advantage of physicians' integration within the hospital, the enterprise must become as data driven in its clinical arenas as it is in its financial endeavors. Timely, accurate and accessible data brings with it an immense power for clinical process improvements and enhanced efficiencies. By allowing physicians to direct process improvements, the hospital can reduce the misuse and/or overuse of hospital resources, obviate costly errors and control variations in care delivery that compromise medical outcomes. But to do this, physicians need more specific clinical information.

On the organizational side, aggregated information can be analyzed and compared to industry norms. Using comparative data, clinicians can facilitate incremental, continual and ultimately transformative reforms in resource utilization and clinical outcomes. What's more, measurements exist that can quantify the financial benefits of clinical improvements, creating a system that actually pays for itself.

In the clinical environment, comprehensive information gathering begins with the physician. In order for a new era of quality improvement to be successful, new solutions must be implemented that are faster, easier for clinicians to use and more easily integrated than paper charts. Thankfully, technology is proving to be a terrific partner in this regard. New and increasingly affordable electronic charting alternatives exist that can not only be implemented in hours or days (instead of weeks or months), but also interface with enterprise-class data systems for analysis.

Such clinical systems have been shown to lower costs and raise quality of care through bi-directional information sharing. Knowing what tests have been ordered by colleagues and having access to the results give physicians the ability to avoid duplicate lab charges and make diagnoses more rapidly and reliably. The reduction in redundancies conserves the hospital's resources, saves purchasers' money and, ultimately, lowers premiums.

These technologies and quality improvement techniques will be essential to hospitals' ability to create accountable care organizations (ACOs) and compete in the new marketplace. Comprehensive federal healthcare reform (Affordable Care Act) enacted in 2010 identifies ACOs as a promising healthcare delivery structure that can improve the quality and cost efficiencies of American healthcare. The model differs from previous attempts at hospital and physician economic alignment by focusing on providers instead of insurers or HMOs.

All ACO functions have not been detailed by the new legislation. But initially they are described as a clinical integration of participating physicians and their affiliated hospitals that manages a defined Medicare population across the continuum of care. While numerous attributes for ACOs have been put forth, four primary functions are emerging. ACOs should:

1.  Establish information interoperability to securely exchange clinical and patient information among authenticated individuals and facilities.

2.  Contain healthcare costs.

3.  Objectively improve medical quality.

4.  Financially reward M.D.s based on improved quality and cost-efficiency outcomes.

In the new ACO paradigm, providers will be expected to hold themselves accountable for their outcomes of care. For this reason, one of the most exciting new frontiers for data-driven accountability assessments comes at the organizational level, where the accountable care index (ACI) is an emerging standard for quality improvement.

Developed in 2008 to support value-based clinical decision making, ACI is a compilation of hospitals' and medical staffs' services and quality outcomes, trended over a three-year period. ACI examines clinically and financially reliable indicators and provides powerful insights into the performance of an individual hospital and its medical staff. By comparing internal data to ACI's industry-standard statistics, hospitals and M.D.s can identify specific areas for quality and cost-efficiency improvements.

Five industry-standard metrics comprise the ACI standard: resource consumption, risk-adjusted morbidity rates, risk-adjusted mortality rates, reductions in variation and the NHQM (national hospital quality measures). ACI uncovers statistically significant clinical variations and provides insights as to initiatives for clinical and financial improvements.

Collaborative, physician-directed best-practice improvements are the healthcare industry's best insurance against the externally mandated cost-containment alternatives that are the hallmark of third-party payers and proposed government-based reforms. As history has proven, advancements in the healthcare field rarely come from outside the profession. It's up to providers to be proactive in addressing their well-publicized quality and cost problems.

ACI, electronic charting and other data-driven initiatives can facilitate clinically reliable analyses of hospital medical records information. These tools, which allow results to be reviewed in consumer- and purchaser-friendly formats, will make collaborative partnerships between stakeholders, clinical quality improvement and medical cost containment a reality.

William C. Mohlenbrock, M.D., is chairman and chief medical officer of Verras. Thomas M. Kish is president of Verras. 

For more information on 

Verras solutions:

Comparative effectiveness research

Comparative effectiveness research is the conduct and synthesis of systematic research comparing different interventions and strategies to prevent, diagnose, treat and monitor health conditions. The purpose of this research is to inform patients, providers and decision makers, responding to their expressed needs, about which interventions are most effective for which patients under specific circumstances. To provide this information, comparative effectiveness research must assess a comprehensive array of health-related outcomes for diverse patient populations. Defined interventions compared may include medications, procedures, medical and assistive devices and technologies, behavioral change strategies and delivery system interventions. This research necessitates the development, expansion and use of a variety of data sources and methods to assess comparative effectiveness.

From U.S. Department of 

Health & Human Services

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