A fundamental premise of a successful business in a traditional capitalistic market is that superior performance resulting in either a superior product or service will determine the leaders in a particular industry. The U.S. healthcare system, despite consuming 15 percent of our national gross domestic national product, has largely not operated under such a system. As a result, "pay for performance" (P4P) has been brought about as a response to evidence that the healthcare sector has significant shortcomings in patient safety, the quality of patient care and efficiency in the delivery of said care. The implications of P4P will be immense for the dialysis and dialysis access realm for reasons including but not limited to the fact that: 1) billons of healthcare dollars are consumed yearly in the care of these patients, and 2) many known quality improvement measures have not been aggressively adopted by the U.S. healthcare community.
It has been estimated that medical errors result in the death of more than 100,000 patients annually. In addition, patients receive recommended care only roughly half of the time, while untold numbers of Americans fail to receive the established and recommended care from which they would likely derive benefit. This lack of uniformity of healthcare delivery has resulted in a per capita health spending variation of nearly two-fold across geographic regions in the United States—all without the benefit of improvement on outcome assessment measures of quality and safety. One such example that demonstrates this lies in the superior patient outcome of certain vascular procedures when performed by vascular specialists as opposed to non-specialized physicians. As an example, according to the 2003 study of Medicare quality and spending, Louisiana spent the most money per beneficiary yet ranked worst among states in overall quality-of-care rankings. Particularly problematic is that this has all occurred in the context of increasing healthcare costs at double the rate of inflation.
Under pressure from the U.S. Congress, the Centers for Medicare & Medicaid Services (CMS) have attempted to find ways to reward quality associated with accepted, evidence-based medical care and have placed considerable time and energy in the adoption and execution of P4P. In theory, a shift to a balanced focus on "value" for healthcare dollars spent helps offset cost and high-quality clinical outcomes. Reducing medical errors, improving clinical outcomes and improving affordability of healthcare are goals shared by the American public, health professionals, hospitals and health systems, and public and private purchasers. By paying differentially based on quality and efficiency, public and private payers seek to align payment incentives with the achievement of these goals.
CMS P4P programs are budget- neutral, implying that some providers will be "winners" and some will be "losers." Resultantly, there will be a revenue distribution from poorer to better performers who meet the designated performance measures. The current voluntary P4P program relies on a limited set of performance measures. The dimensions of performance vary across P4P programs. For hospitals and physicians, the measure sets the focus on: 1) preventive services such as influenza and childhood vaccines, 2) selected care of common conditions like diabetes, heart attack, congestive heart failure, pregnancy and newborns, and 3) complications such as surgical infections. Some P4P programs also include measures of patient perceptions derived from patient surveys. Future P4P initiatives will likely have more measures of the effectiveness and efficiency of clinical processes, and of patient outcomes. It is the outcome assessment of patient care that likely will result in the most challenging adaptation for hospitals and physicians as little institutional outcome measurement capabilities are in place in most U.S. practices despite the improved performance traditionally seen in practices that have methods of outcome measurements in place.
The advent of P4P programs is not novel; P4P has been used by businesses to improve quality and efficiency. Some programs include offering bonuses in addition to regular salary or withholding part of the salary and allowing the employee to earn it back as a reward for increased efficiency, quality or productivity. To be effective, such reward should be of a sufficient value in order to affect change in the intended behavior. Additionally, the implementation should be simplistic enough to be easily understood by users. In its current form, critics complain that neither of these criteria is met in the current voluntary P4P plan.
Another obstacle to compliance lies in the relative failure of most medical practices to have in place standardized methods of data collection, analysis and outcome reporting. This, more than any other factor may result in non-participation by practices in the current voluntary reporting P4P program. Failure to comply initially will likely have disastrous consequences, as these practices may fail to be considered "high-performing" in later years. Also, it is highly likely that the results of reporting may eventually become public record, and those practices either not participating or late to participate in P4P reporting may be viewed adversely despite the quality of care rendered. The unintended consequence of P4P lies in the fact that if only efficiency is rewarded, quality may suffer. Similarly, in nonmedical fields, good performance may equate with improved profits, perhaps without emphasis on quality. When P4P models are used in the medical and surgical fields, however, most think of performance in terms of improved quality as represented by improved outcomes.
Naysayers—often skeptical physicians—point to the fact that very few peer-reviewed publications can be found to support this approach. A recently published article in JAMA that examined data on three performance outcome measures (cervical cancer screening, mammography and hemoglobin A1c testing) concluded: "Paying clinicians to reach a common, fixed performance target may produce little gain in quality for the money spent and will largely reward those with higher performance at baseline." Those above the target threshold feel that what they need to do is keep the status quo to get the performance bonus. In addition, the authors speculated that the performance bonus was too modest, at 5 percent annually, to result in a significant behavior change.
Despite the absence of appropriate research validating the merits of P4P, the process is not slowing down. In fact, the P4P movement has gained significant traction with the CMS announcement on Oct. 28, 2005, that it would put in place a Physician Voluntary Reporting Program (PVRP) that began in 2006. In the notification it published on Nov. 2, 2005, CMS stated that the PVRP is being instituted as a part of its overall quality-improvement efforts to "substantially improve the health and function of our beneficiaries by preventing chronic disease complications, avoiding preventable hospitalizations and improving the quality of care delivered." The notification went on to state that "CMS is committed to the development of reporting and payment systems that will support and reward quality" and that "the quality initiatives aim to . . . ultimately support new payment systems that provide more financial resources to provide better care, rather than simply paying based on the volume of the service." This action has served notice that P4P is here to stay and will surely have a significant and permanent effect on healthcare providers and hospitals. Although initially established as a CMS program, past history strongly indicates that private third party payers will likely follow suit with similar initiatives.
P4P in Action
Stroke is the third leading cause of death in the United States and a leading cause of disability resulting in billions in healthcare expenditures annually. One-third of all stokes are due to blockages that develop within the carotid arteries, the primary blood supply to the brain. Traditionally treated by surgical removal of these blockages, angioplasty and stenting has recently been shown to be an effective and safe alternative for a subset of individuals. In the attempt to regulate the performance of a procedure where adverse outcomes could be devastating not only to the individual but also to the health care economy, CMS introduced the first P4P program for a surgical specialty in its memorandum on specialists performing carotid artery stenting for the prevention of stroke. Not only did CMS require specific conditions for facility certification to perform carotid stenting, but they also set the exact preoperative and clinical conditions and anatomic criteria of disease that have to be met to satisfy their conditions for reimbursement. Failure to demonstrate these outlined criteria at best results in non-payment for services, and at worst could result in charges of and investigative efforts for Medicare fraud. To maintain credentialing, CMS mandated that either the facility or a contractor to the facility collect, analyze and submit to CMS, on a six-month basis, data on all carotid artery stenting procedures performed at the facility. The data must be made available upon CMS request; a facility will continue be reimbursed and able to perform carotid stenting only if it maintains a level of performance acceptable to CMS. These actions have relegated the performance of this stroke-prevention procedure to only those clinicians and facilities that will provide the requisite data and proof of performance, thus P4P.
P4P has the capability and likelihood to fundamentally alter the nature of the healthcare marketplace. Performance measurement combined with public reporting promises to enable many different patient groups and third party providers to make decisions informed by safety, quality and efficiency considerations. The decisions that P4P data may heavily influence include patient selection of a hospital to seek care, selection of a primary care physician or specialist, and selection by clinicians of referral sources. In addition, P4P data has a high likelihood to be used by organizations responsible for certification and accreditation purposes. Perhaps the most promising potential achievement of P4P programs may be the use of standardized performance measures enabling comparisons of practitioner performance within a community and between communities—or clinical "benchmarking." Information gathered will allow comparisons of the safety, quality and efficiency of care received by various demographics of patients, thus identifying disparities in access and quality associated with gender, ethnicity, and/or socio-economic status.
Debate determining the future course of healthcare delivery to the United States has taken center stage in many discussions nationally. There are significant issues yet to be determined. One certainty lies in the fact that P4P is here to stay and will only increase in relevance and importance. The prudent course of all dialysis healthcare providers likely will be one that operates in the context of embracing rather than ignoring the inevitability of P4P. A failure to do so may have adverse consequences for those unwilling to participate in future P4P programs.
Dr. Sam is a vascular surgeon at Baton Rouge, La.-based Vascular Surgery Associates. He is also a clinical assistant professor at Louisiana State University Health Sciences Center.