Reconciling quality measurement with financial risk adjustment in health plans.

BACKGROUND: Initiatives to improve quality measurement (QM) and to create systems for financial risk adjustment (RA) have developed in response to concerns about price competition's threat to quality and stimulation of risk selection. QM is designed to help purchasers identify best plans, to aid plans in their selection of providers, to facilitate quality improvement by plans and providers, and to assist patients faced with choices among plans and providers. The goal of RA is to eliminate incentives for plans and providers to avoid sick, high-cost patients in favor of healthy, low-cost patients. CONFLICTS BETWEEN QM AND RA: For QM it is often necessary to identify all patients with a particular condition, and many quality measures involve intervening on patients early in the course of their disease. Identifying patients through utilization decisions (for example, identifying patients with depression through receipt of an antidepressant prescription) may bias QM. For RA, the focus is on the highest-cost patients, and patient capture through resource utilization is more likely to be appropriate. DISCUSSION: Achieving QM and RA depends on improving information systems and patient identification processes and developing standard definitions for important variables. QM and RA could both be improved, and the conflicts between them reduced, if they were based more on detailed clinical data, if consensus definitions of quality of care for specific diagnoses could be achieved, if the number of QM measures that target acute and chronic care (versus preventive care) were increased, and if information systems were enhanced.

The policy implications of using hospital and physician volumes as "indicators" of quality of care in a changing health care environment.

There is growing interest in the quality of health care and in using quality measures to direct patients to hospitals and providers offering high quality, low cost health care. The dilemma is that, while there is an increasing need for quality indicators as a result of a changing health care environment, this changing environment has important implications for the use of some of these measures. Since the 1970s, a growing body of research in the U.S. has addressed the empirical relationship between the number of patients with a specific diagnosis of surgical procedure and their outcomes after treatment in a particular hospital or by a particular physician ("volume-outcome" studies). In this paper, we examine the policy implications of using hospital and physician volume information as an "indicator" of quality in a rapidly changing health care environment with new players and new incentives. We begin by describing the evolution of the use of volumes within both regulatory and market-oriented contexts in the U.S. We then discuss policy considerations and cautions in using volumes, along with suggestions for future research. Our purpose is to point out potential problems and clarify confusions about the use of volumes, so that policymakers and practitioners can be sensitive to the potential minefields they are traversing.

Regionalization of cardiac surgery in the United States and Canada. Geographic access, choice, and outcomes.

OBJECTIVE: To determine how regionalization of facilities for coronary artery bypass surgery (CABS) affects geographic access to CABS and surgical outcomes. DESIGN: Computerized hospital discharge records were used to measure hospital CABS volume and in-hospital post-CABS mortality rates. Relationships between surgical volume and age- and sex-adjusted mortality rates were compared using chi 2 tests. Small-area analysis of the association between CABS rates and distances to nearest CABS hospital was performed using multivariate linear regression methods. SETTING: All nonfederal hospitals in New York, California, Ontario, Manitoba, and British Columbia. PATIENTS: All adult residents of the five jurisdictions who underwent CABS in a hospital in their jurisdiction from 1987 through 1989. RESULTS: In New York and Canada, approximately 60% of all CABS operations took place in hospitals performing 500 or more CABS operations per year, compared with only 26% in California. The highest mortality rates were found among California hospitals performing fewer than 100 CABS operations per year (adjusted 14-day in-hospital mortality was 4.7% compared with 2.4% in high-volume California hospitals, P < .001). The percentage of the population residing within 25 miles of a CABS hospital was 91% in California, 82% in New York, and less than 60% in Canada. Eliminating very low-volume (< 100 cases per year) CABS hospitals in California would increase travel distances to a CABS hospital only slightly for a small number of residents. The Canadian degree of regionalization was not associated with lower CABS rates within provinces for populations living at more remote distances from the nearest CABS hospital. CONCLUSION: Regionalization of CABS facilities in New York and Canada largely avoids the problem of low-volume outlier hospitals with high postoperative mortality rates found in California. New York has avoided the redundancy of facilities that exists in California while still providing residents a geographically convenient selection of CABS hospitals. Stricter regionalization in Canada may leave residents with a more narrow choice of facilities, but does not disproportionately affect access to surgery for populations living at remote distances from CABS facilities.

The association of hospital volumes of percutaneous transluminal coronary angioplasty with adverse outcomes, length of stay, and charges in California.

The objective of this study was to examine whether hospital volumes of percutaneous transluminal coronary angioplasty (PTCA) are associated with adverse outcomes (coronary artery bypass graft surgery after PTCA and/or in-hospital mortality), post-PTCA length of stay (LOS), and hospital charges. Discharge data for 24,856 patients undergoing PTCA in 1989 from 110 California hospitals were analyzed. Regression analysis was used to adjust patient discharge data for risk factors. Actual and predicted adverse outcomes, LOS, and charges were compared for hospital volume categories (using 95% confidence intervals). Rates of adverse outcomes were significantly higher than expected in low-volume hospitals (< 201 PTCAs) and significantly lower than expected in high-volume hospitals (> 400 PTCAs). The results were similar for LOS and charges, although the results for charges were less conclusive. The associations of volumes and outcomes were generally consistent for both unadjusted and adjusted analyses, for patients with and without principal diagnoses of acute myocardial infarction, and using different methods and functional forms. Given this association between hospital volumes of PTCA and outcomes, future research should assess the underlying causes of this association and whether limiting the use of low-volume facilities would improve outcomes.

Measuring hospital mortality rates: are 30-day data enough? Ischemic Heart Disease Patient Outcomes Research Team.

OBJECTIVE: We compare 30-day and 180-day postadmission hospital mortality rates for all Medicare patients and those in three categories of cardiac care: coronary artery bypass graft surgery, acute myocardial infarction, and congestive heart failure. DATA SOURCES/COLLECTION: Health Care Financing Administration (HCFA) hospital mortality data for FY 1989. STUDY DESIGN: Using hospital level public use files of actual and predicted mortality at 30 and 180 days, we constructed residual mortality measures for each hospital. We ranked hospitals and used receiver operating characteristic (ROC) curves to compare 0-30, 31-180, and 0-180-day postadmission mortality. PRINCIPAL FINDINGS: For the admissions we studied, we found a broad range of hospital performance when we ranked hospitals using the 30-day data; some hospitals had much lower than predicted 30-day mortality rates, while others had much higher than predicted mortality rates. Data from the time period 31-180 days postadmission yield results that corroborate the 0-30 day postadmission data. Moreover, we found evidence that hospital performance on one condition is related to performance on the other conditions, but that the correlation is much weaker in the 31-180-day interval than in the 0-30-day period. Using ROC curves, we found that the 30-day data discriminated the top and bottom fifths of the 180-day data extremely well, especially for AMI outcomes. CONCLUSIONS: Using data on cumulative hospital mortality from 180 days postadmission does not yield a different perspective from using data from 30 days postadmission for the conditions we studied.

A comparison of administrative versus clinical data: coronary artery bypass surgery as an example. Ischemic Heart Disease Patient Outcomes Research Team.

Health services researchers rely heavily on administrative data bases, but incomplete or incorrect coding may bias risk models based on administrative data. The best method for validating administrative data is to collect detailed information about the same cases from independent sources, but this approach may be too costly or technically difficult. We used data on coronary artery bypass surgery from four sites (Duke University; Minneapolis--St Paul; California; and Manitoba) to demonstrate an alternative approach for assessing diagnostic coding and to explore the implications of miscoding. The first two sites have clinical data; the second two have administrative data. The prevalences of 14 comorbidities and the associated risk ratios for short-term mortality were compared across data sets. Some comorbidities could not be precisely mapped to ICD-9-CM. Chronic or asymptomatic conditions such as mitral insufficiency, cardiomegaly, previous myocardial infarction, tobacco use, and hyperlipidemia were far less prevalent in administrative data than in clinical data. The prevalence of diabetes, unstable angina, and congestive heart failure were similar in administrative and clinical data. Estimates of relative risk derived from clinical data equalled or surpassed those derived from administrative data for all conditions. Hospitals should be encouraged to improve reporting of coexisting conditions on discharge abstracts and claims. In the meantime, researchers using administrative data should assess the vulnerability of their risk models to bias caused by selective underreporting.

Coronary angioplasty. Statewide experience in California.

BACKGROUND: This report describes the in-hospital experience with percutaneous transluminal coronary angioplasty (PTCA) for the state of California in 1989. Data are derived from the statewide hospital discharge abstracts. METHODS AND RESULTS: A total of 24,883 PTCAs were performed; most patients (70%) were men and most procedures were single vessel (87%). About one fifth (19%) of patients had a principal diagnosis of acute myocardial infarction (AMI). Overall mortality was 1.4% and was higher in the AMI group (4.2%) versus the non-AMI group (0.8%, P = .0001). Mortality was higher for AMI patients having PTCA on the day of or day after admission (5.5%) versus those treated later (2.6%, P = .0001). Five percent of patients had coronary artery bypass surgery (CABG) after PTCA; CABG was performed on the same day as PTCA in 61.7% of cases. Patients presenting with AMI were more likely to have CABG (7.1%) than non-AMI patients (4.5%, P = .0001). Mortality associated with CABG was 7.3% and was higher in the AMI group (12.0%) than in the non-AMI group (5.5%, P = .0001). Factors predictive of increased mortality by bivariate analysis included age > 63 years (2.1% mortality versus 0.8% < or = 63, P = .01), female sex (1.9% versus 1.2% for men, P < .01), and the presence of diabetes (1.9% versus 1.3% for nondiabetics, P < .05). Multiple logistic regression showed that timings of PTCA with respect to admission (P = .004) and age (P = .05) were predictors of mortality, but female sex was predictive only in the non-AMI group (P = .03). Mean hospital charges were $19,597 (+/- SD, $18,213). Forty-two percent of the 110 hospitals performed more than the recommended minimum of 200 cases per year. The requirement for CABG during the same admission or the combined adverse outcome of CABG and/or death was increased in the lower-volume centers for both AMI and non-AMI patients (P < .001), although mortality alone was not. CONCLUSIONS: The mortality and need for CABG surgery in the statewide California PTCA experience is higher than that generally reported in the literature. In patients with an admitting diagnosis of AMI, the overall mortality was higher, as was the need for CABG and the associated CABG mortality. Most hospitals performed fewer than 200 PTCAs per year. Rates of CABG surgery and the combination of CABG and/or mortality, adjusted only for the presence or absence of AMI, were increased at the low-volume institutions.

Anatomy of health care reform proposals.

The current proliferation of proposals for health care reform makes it difficult to sort out the differences among plans and the likely outcome of different approaches to reform. The current health care system has two basic features. The first, enrollment and eligibility functions, includes how people get into the system and gain coverage for health care services. We describe 4 models, ranging from an individual, voluntary approach to a universal, tax-based model. The second, the provision of health care, includes how physician services are organized, how they are paid for, what mechanisms are in place for quality assurance, and the degree of organization and oversight of the health care system. We describe 7 models of the organization component, including the current fee-for-service system with no national health budget, managed care, salaried providers under a budget, and managed competition with and without a national health budget. These 2 components provide the building blocks for health care plans, presented as a matrix. We also evaluate several reform proposals by how they combine these 2 elements.

Chance, continuity, and change in hospital mortality rates. Coronary artery bypass graft patients in California hospitals, 1983 to 1989.

OBJECTIVE: To assess whether risk-adjusted mortality rates for hospitals reflect primarily chance variation. DESIGN: Observation over time. SETTING: All 115 California hospitals with five or more coronary artery bypass graft (CABG) patients in any year 1983 to 1989. PATIENTS: All CABG patients aged 18 years and older excluding those with other open heart procedures and percutaneous transluminal coronary angioplasty on the day of CABG surgery (n = 132,750). OUTCOME MEASURE: Inpatient mortality adjusted for age, gender, chronic comorbidities, timing of surgery, and presence of additional procedures. METHODS: Data were derived from routinely collected hospital discharge abstracts. Observed and expected semiannual mortality rates were examined for each hospital to identify consistent patterns over time. Using the quartile of patients with the highest predicted risk (average mortality, 10%), high- and low-outlier hospitals were identified from 2 consecutive years of pooled data and outcomes 2 years later were examined. Each hospital-year observation was also examined individually to identify outliers and to assess differences for observed and expected death rates, patient volume, and other characteristics. RESULTS: Some hospitals showed consistently lower-than-expected inpatient mortality. Some hospitals had periods of significantly higher-than-expected mortality followed by a correction. High-outlier hospitals that were selected based on 2 years of data had mortality rates 2 years later that averaged 31% above expected, while low-outlier hospitals had rates 2 years later that averaged 28% below expected. On a contemporaneous basis, high outliers had proportionately more transfers to other acute care hospitals and longer postoperative stays among survivors. CONCLUSIONS: Risk-adjusted outcomes for CABG patients derived from administrative data exhibit substantial patterns of consistency. Such patterns cannot be detected for low-risk patients but are evident for the top quartile of patients stratified by risk. Even with reporting lags and changes in hospital outcomes over time, a policy of channeling high-risk patients away from high-outlier hospitals and toward low-outlier hospitals could lower their overall risk-adjusted mortality rate by 45% [corrected].

Use of coronary artery bypass surgery in the United States and Canada. Influence of age and income.

OBJECTIVE: To compare overall rates of coronary artery bypass surgery (CABS) in several Canadian and US jurisdictions and to compare use by age and income groups in the two countries. DESIGN: Survey, using computerized hospital discharge abstracts. SETTING: All nonfederal hospitals in New York, California, Ontario, Manitoba, and British Columbia between 1983 and 1989. PATIENTS: All adult residents of the five jurisdictions who underwent CABS in a hospital in their jurisdiction. RESULTS: Between 1983 and 1989, the CABS rates were consistently highest in California and lowest in the Canadian jurisdictions. In 1989, the age-adjusted rate of CABS in California (112.5/100,000 adults) was 27% higher than in New York (88.4/100,000) and 80% higher than in the three Canadian provinces combined (62.4/100,000). The CABS rates increased for those aged 65 years and older and decreased for those aged 20 to 54 years in all five jurisdictions. In 1989, CABS rates were three times higher in California than in Canada for those aged 75 years and older, and the higher rates for those aged 65 years and older accounted for 75% of the overall difference in rates between California and Canada. In Canada, CABS rates for the nonelderly varied little by income of area of residence, but in New York and California, rates increased steadily with the income of area of residence. CONCLUSION: Control over the supply of resources in Canada is associated with markedly lower CABS rates for the elderly than found in the United States. While overall rates are lower in Canada, the Canadian universal health insurance system reduces the influence of income on access to CABS found in the United States. However, even without universal health insurance, CABS rates for the nonelderly living in the poorest areas in California are similar to the rates for those living in the poorest parts of Canada.

Modeling the effect of hospital charges and quality on choice.

The authors apply a conditional choice model to simulate the results of patient and physician choices of hospitals for a specific surgical procedure in response to improvements in quality or changes in charges. The model includes all zip code areas and relevant hospitals in a large metropolitan area and estimates the impact on admissions at each hospital. It can be used to estimate both the impact of decisions by a given hospital and the potential responses of competitors, as well as the effects of selective contracting with hospitals by certain payors.

Hospital competition and surgical length of stay.

The hypothesis that competitive pressures encourage hospitals to accommodate patient and physician preferences for longer lengths of stay was tested. Seven hundred forty-seven nonfederal short-term hospitals were divided in terms of the number of neighboring hospitals within a 24-km radius, and this measure of hospital concentration and competition was measured against length of stay for ten surgical procedures, using 1982 data on 498454 patient discharges. Patient, physician, and hospital characteristics associated with length of stay were controlled for. Competition-related percentage increases in length of stay were identified for all procedures, including total hip replacement (14.8%), transurethral prostatectomy (13.9%), intestinal operations (14.0%), stomach operations (14.7%), hysterectomy (6.9%), cholecystectomy (9.1%), hernia repair (10.5%), appendectomy (8.4%), cardiac catheterization (22.9%), and coronary artery bypass graft surgery (21.2%). It was concluded that there is a strong association between the number of hospital competitors in the local market and the average length of stay in US hospitals.

Effects of surgeon volume and hospital volume on quality of care in hospitals.

A growing body of evidence indicates that certain surgical procedures exhibit a "volume-outcome" relationship in which a higher volume of patients undergoing a particular procedure at a hospital is associated with better outcomes for those patients. The proportion of a hospital's patients operated on by low-volume or less experienced surgeons also may be associated with poor patient outcomes and thus contribute to the hospital "volume-outcome" relationship. This paper analyzes the influence of hospital volume and the proportion of a hospital's patients operated on by low-volume surgeons on patient outcome for 10 procedures, controlling for other selected factors that may influence outcomes. The analysis is based on 503,662 patient abstracts from 757 hospitals. Results indicate that both hospital volume and the proportion of patients operated on by low-volume surgeons are related to quality of care as measured by patient outcomes. Higher hospital volume is positively related to better patient outcomes. These findings are consistent with earlier hospital "volume-outcome" research and add an additional set of procedures using more recent data to the evidence. Unlike previous research on surgeon volume, a positive relationship was found between higher percentage of patients operated on by low-volume surgeons and poorer hospital quality.

The volume-outcome relationship: practice-makes-perfect or selective-referral patterns?

Various studies have demonstrated that hospitals with larger numbers of patients with a specific diagnosis or procedure have lower mortality rates. In some instances, these results have been interpreted to mean that physicians and hospital personnel with more of these patients develop greater skills and that this results in better outcomes--the "practice-makes-perfect" hypothesis. An alternative explanation is that physicians and hospitals with better outcomes attract more patients--the "selective-referral pattern" hypothesis. Using data for 17 categories of patients from a sample of over 900 hospitals, we examine the patterns of selected variables with respect to hospital volume. To explore the plausibility of each hypothesis, a simultaneous-equation model is also used to test the relative importance of the two explanations for each diagnosis or procedure. The results suggest that both explanations are valid, and that the relative importance of the practice or referral explanation varies by diagnosis or procedure, in ways consistent with clinical aspects of the various patient categories.

Changes in patient characteristics and surgical outcomes for coronary artery bypass surgery 1972-82.

Data from a national sample of hospitals were used to explore reasons for improved in-hospital survival rate for coronary artery bypass graft (CABG) surgery between 1972 and 1982. Increases in annual volumes of surgery explain a large fraction of the decline in death rates. The residual can be attributed to improved techniques, experience, and other factors, even though more operations were done on older patients and women in 1982 than 1972.

Association of volume with outcome of coronary artery bypass graft surgery. Scheduled vs nonscheduled operations.

Empirical evidence suggests that mortality rates for coronary artery bypass graft (CABG) surgery are lower in hospitals that perform a higher volume of the procedure. In recent years, the criteria for CABG surgery have been expanded to include patients with a wide variety of co-morbidities. To address the question of whether the volume-outcome relationship continues to exist for this new group of patients, discharge abstracts for 18,986 CABG operations at 77 hospitals in California in 1983 were analyzed using multiple-regression techniques. Higher-volume hospitals had lower in-hospital mortality (adjusted for case mix); this effect was greatest in patients who might be characterized as having "non-scheduled" CABG surgery. Higher-volume hospitals also had shorter average postoperative lengths of stay and fewer patients with extremely long stays. The results of this study suggest that the greatest improvement in average outcomes for CABG surgery would result from the closure of low-volume surgery units.