Transparency on Cost and Quality:
Understanding Value in Health Care Through
Provider Peer Grouping
BHCAG, 5th Employer Leadership Summit
February 23, 2012
Stefan Gildemeister, Director Health Economics Program
Overview
• Trends in health care cost and quality – what do
we know?
• What is Provider Peer Grouping?
• What information is calculated by Provider Peer
Grouping?
• What are challenges with performing (and
displaying) analysis results?
• Next steps
2
Role of the Health Economics Program
• Monitor health care market and provides
unbiased analysis
– Study trends and characteristics of the uninsured
– Perform empirical research on health care cost, quality,
coverage, and access
– Assist in the development and analysis of health policy and
health reform
• Implement aspects of the 2008 Minnesota
health reform law
3
Quality Variation: Diabetes Optimal Care
Source: Statewide Quality Reporting System, Health Economics Program
MHCP are Minnesota Health Care Programs, which include Medicaid and MinnesotaCare
4
Health Care Growth Exceeds Growth in
Income & Wages
Source: HEP analysis of annual health plan reports, preliminary
5
Trends in Cost Sharing in Minnesota’s
Private Market
Source: HEP analysis of annual health plan reports, preliminary
6
What is Provider Peer Grouping?
• A system for providing comparative information to
consumers on variation in health care cost and
quality across providers:
– …a uniform method of calculating providers' relative cost of
care, defined as a measure of health care spending
including resource use and unit prices, and relative quality
of care… (M.S.§62U.04, Subd. 2)
– a combined measure that incorporates both provider riskadjusted cost of care and quality of care… (M.S.§62U.04,
Subd. 3)
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What Types of Provider Peer Grouping
Needs to be Developed?
1. Total Care
2. Care for Specific Conditions
The commissioner shall develop a peer grouping system for
providers based on a combined measure that incorporates
both provider risk-adjusted cost of care and quality of care,
and for specific conditions… (M.S.§62U.04, Subd. 3)
• Both types of analysis are to be done annually
for hospitals and for physician clinics
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Information Calculated by
Provider Peer Grouping
Results for Consumers – Example 1
Low Cost
Results for Consumers – Example 2
Process of Care Score: 27
Process of Care
Number of
Patients
PerforQuality Points
mance Rate Earned
Heart Attack Care
AMI-1
(CMS)
Heart attack patients given aspirin at
arrival
54
100%
10
AMI-2
(CMS)
Heart attack patient given aspirin at
discharge
40
95%
7
AMI-3
(CMS)
Heart attack patients given ACE inhibitor
or ARB for left ventricular systolic
dysfunction
5
100%
n/a
AMI-4
(CMS)
Heart attack patients given smoking
cessation advice/counseling
9
100%
n/a
AMI-5
(CMS)
Heart attach patients given beta blocker
at discharge
42
93%
7
AMI-8a
(CMS)
Heart attack patients given PCI within 90
minutes of arrival
0
n/a
n/a
Results for Consumers – Example 3
Readmission Score: 27
Care Outcome
Number
Risk Adjusted Quality
of Patients Readmission Points
Earned
Readmission Measure
READM30-AMI
(CMS)
30-day readmission rate of hospital discharge
(heart attack)
68
20%
4
READM30-HF
(CMS)
30-day readmission rate of hospital discharge
(heart failure)
206
27.4%
2
READM30-PN
(CMS)
30-day readmission rate of hospital discharge
(pneumonia)
270
20.2%
0
Results for Consumers – Example 4
Total Care Costs, by Payer and Type of Service
Number of
Discharges
Total
Costs per
Discharge
Price Standardized
Payments per
Discharge
Ratio of Total Costs to
Standardized Payments
per Discharge
9,015
$7,744
$8,667
0.89
Medicare
2,366
$7,818
$8,312
0.94
Medicaid
632
$5,234
$6,607
0.79
Commercial
6,017
$8,071
$9,209
0.88
Medical
6,990
$6,567
$7,461
0.88
Surgical
805
$20,919
$23,032
0.91
Newborn
1,176
$3,215
$3,544
0.91
Total
Payer Type
Service Type
Challenges
• Methodology
– Scoring / relative vs. absolute ranking
– Sufficient measures for scoring
– Adequacy of actionable / meaningful measures (process / outcome /
functional status?)
• Completeness and timeliness of data
• Validation of data by providers
• Display of results
– Platform
– Ability to search (dig down / compare)
– Context
• Adequate staffing and funding for analytic intense efforts
Next Steps, 2012
• Finalizing (revised) first version for confidential review by
hospitals
• Preparing summary information of hospital results
• Advisory group process informing methodology
• Performing clinic level analysis
• Releasing first version for confidential review by clinics
• Preparing summary information of clinic results
• Developing public reporting platform with input from
stakeholders and consumers
• Developing second version of hospital data intended for
hospital-specific public release
Additional information on PPG is available online:
www.health.state.mn.us/healthreform/peer/
Information on Minnesota’s health care market can
also be found online :
www.health.state.mn.us/healtheconomics
Contact information:
Stefan.Gildemeister@state.mn.us or 651-201-3554
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