Overview of Today’s Presentation

1. Overview of Today’s Presentation • Strategies available to CMS to improve quality • Focus on public reporting and consumer information • Current Quality Initiatives, with focus on Hospital work

2. Pursuing Excellence

3. WHAT WE CAN DO TO IMPROVE QUALITY MANAGE PROCESS IN PARTNERSHIP WITH STAKEHOLDERS SELECT PRIORITY AREAS ADOPT OR DEVELOP MEASURES COLLECT & ANALYZE DATA IDENTIFY IMPROVEMENT OPPORTUNITIES AND SELECT APPROPRIATE IMPROVEMENT INTERVENTIONS SUPPORT STANDARD METHODS PROMOTE OR CREATE COLLABORA-TIONS AND PARTNER-SHIPS GIVE PLANS, DOCTORS & PROVIDERS TECHNICAL ASSISTANCE GIVE CONSUMERS INFOR-MATION AND ASSISTANCE TO MAKE CHOICES STRUCTURE COVERAGE AND PAYMENTS TO IMPROVE CARE REWARD DESIRED PERFORM-ANCE ESTABLISH & ENFORCE STANDARDS 3

4. CMS Approach to Quality • Announced November 2001 by Secretary Thompson: • Empower consumers to make more informed decisions regarding their healthcare • Stimulate / support providers & clinicians to improve the quality of health care

5. SUPPORT STANDARD METHODS PROMOTE OR CREATE COLLABORA-TIONS AND PARTNER-SHIPS GIVE PLANS, DOCTORS & PROVIDERS TECHNICAL ASSISTANCE GIVE CONSUMERS INFOR-MATION AND ASSISTANCE TO MAKE CHOICES REWARD DESIRED PERFORM-ANCE STRUCTURE COVERAGE AND PAYMENTS TO IMPROVE CARE ESTABLISH & ENFORCE STANDARDS A focus on consumer information, complemented by additional tactics

6. Comparative Quality Information on www.medicare.gov • Medicare Health Plan Compare - 1999 • Dialysis Facility Compare - 2001 • Nursing Home Compare - 2002 • Home Health Compare – 2003 • Hospital Compare – 2004

7. The National Voluntary Hospital Reporting Initiative • A partnership • American Hospital Association, Federation of American Hospitals, Assoc of American Medical Centers, The Disclosure Group (consumer, union and private purchaser advocates), National Quality Forum, JCAHO, American Medical Association, Nat Assoc of Hosp for Children and Related Inst, Agency for Healthcare Research and Quality, AFL-CIO • Public reporting and building of a data infrastructure simultaneously

8. The National Voluntary Hospital Reporting Initiative • Phase I: report starter set of 10 measures (NOW in progress) • Phase II: report standardized patient perception of care survey (HCAHPS) (late 2004 at earliest) • Phase III: more measures

9. The Premier Hospital Quality Incentive Demonstration • A demo is a way for CMS to send a new message, to test new payment methods • This demo: Test how/if financial incentives drive superior quality inpatient care • CMS demonstration with Premier, Inc. • Reports the performance data on www.cms.hhs.gov

10. The Premier Hospital Quality Incentive Demonstration 5 clinical conditions (34 measures) • Acute MI • Heart Failure • Pneumonia • Coronary Artery Bypass Graft • Hip and Knee Replacement

11. The Premier Hospital Quality Incentive Demonstration • Top 50% of hospitals in each clinical area publicly acknowledged on CMS website • Bonuses for top 2 deciles for each condition • Top decile given 2% bonus of their Medicare DRG payments for that condition • Second decile given a 1% bonus • Possible penalty in third year for laggards

12. One possible payment scenario Condition X Condition X 1st Decile Hospital 2 2nd Decile 1st Decile Condition X 3rd Decile 2nd Decile 4th Decile 5th Decile 3rd Decile 1st Decile Top Performance Threshold 4th Decile 6th Decile 2nd Decile 5th Decile 7th Decile 3rd Decile 6th Decile 8th Decile 4th Decile 9th Decile 7th Decile 5th Decile 10th Decile 8th Decile 6th Decile 9th Decile 7th Decile Payment Adjustment Threshold 10th Decile 8th Decile 9th Decile 10th Decile Year One Year Two Year Three

13. The Premier Hospital Quality Incentive Demonstration • Voluntary • Eligibility: Hospitals in Premier Perspective system as of March 31, 2003 • 300 hospitals anticipated to participate • Demonstration Project: test of concept • Could be expanded (with modifications) in the future

14. Doctor’s Office Quality (DOQ) Project (early stages now) • Topics: Preventive care, DM, HTN, CAD, HF, Osteoarthritis, Depression, patient perceptions of care, assessment of systems of care. • Clinical measures • Developed in conjunction with AMA/Consortium and with expert panel • Exploring ability to create composite score • Exploring use of claims-based data, EHRs. • Process improvements • Care reminders, other

15. DOQ-IT: Objectives • Promote adoption and use of IT in physician offices • Create infrastructure for QIO to receive data from electronic office-based systems for use in confidential technical assistance and public reporting Just starting this – completing some early contracting

16. DOQ-IT: What QIOs will do • Assist physicians in decision to adopt • Costs and benefits • Systems availability – registry/EHR • Systems information • Provide implementation assistance • Technical issues • Workflow redesign • Receive electronic data from physicians and provide improvement assistance • EHR specifications for clinical measures and systems operating reports • Process redesign to support chronic care management

17. DOQ-IT: Potential Demonstration • Requirements for payment • Adopt specified IT systems to improve safety/quality and to manage patients with chronic disease • Full EHR or • E-Rx, e-lab results management, e-registry • Demonstrate use of such systems through electronic data transmitted to QIO • Meet performance targets – public reporting • Meet cost reduction targets (in aggregate) • Coordination with Bridges to Excellence program

18. More Information • http://www.cms.hhs.gov/quality/ Fact sheets on: Hospital Quality Initiative; 3 State Hospital Pilot; H-CAHPS; Nursing Home and Home Health Quality Initiatives, more

19. Thank you Barbara R. Paul MD 410-786-5629 bpaul@cms.hhs.gov