Dr. James Weinstein Director of The Dartmouth Institute for Health Policy and Clinical Practice

1. Where is the Wisdom in Health Care? How do we advance the HealthPolicy agenda for Musculoskeletal Conditions? Dr. James Weinstein Director of The Dartmouth Institute for Health Policy and Clinical Practice Third Century Chair , Dartmouth Medical School “It’s all about the Delivery System”

2. To discuss the impact that the burden of musculoskeletal disease has had in influencing lawmakers as they debate health reform. Variations in practice and rapidly increasing costs illustrate starkly the dilemma we face in bending the cost curve on health care. Key provisions of current legislative proposals -- including comparative effectiveness research, increased NIH research funding, shared decision-making, accountable care organizations, the CMS Innovation Center -- should have a substantial impact on the diagnosis and treatment of musculoskeletal conditions. Health Policy agenda Musculoskeletal Conditions • Context • Background; current state of Healthcare • Variations in practice • Rapidly increasing costs • Bending the cost curve on health care. • Key provisions of current legislative proposals • Comparative effectiveness research, • Increased NIH research funding, • Shared decision-making, • Accountable care organizations (ACO’s), • CMS Innovation Center • All should have a substantial impact on the diagnosis and treatment of musculoskeletal conditions and health care overall.

3. Context Agenda For Change Improving Quality and Curbing Health Care Spending:Opportunities for Congress and for the Obama Administration Jim Weinstein Director, The Dartmouth Institute for Health Policy and Clinical Practice Third Century Professor Dartmouth Medical School

4. Background Houston, we’ve got a problem…. • Poor Quality • Rising number of uninsured • Spiraling Cost • Patient & Societal Expectations • The Business of Health Care • Politicization of Health Care • Loss of Physician Autonomy/Specialization • Legal Problems U.S. GNP $12 Trillion Projected growth 3%/yr. Healthcare $2.7 Trillion Projected growth 7%/yr.

5. Spiraling Cost

6. Thinking clearly about reformUnderlying causes – and strategic aims for health care reform The Paradox What’s going on? What should we do?

7. Medicine's Nemesis: Practice VariationWhat to do? Variation – Disparity (Economic, Racial), and Geography is Destiny Evidence - Based Info re: BIG THREE Effective Care - 15% Preference Based Care - 25%– Informed Choice Supply Sensitive Care - 60% Solutions – yOur Role The ‘Patient’as a catalyst for change (IOM)

8. Dartmouth Atlas Addressing “Geographic differences” in health care delivery and spending is an opportunity to achieve significant savings in health care costs without compromising health care quality and outcomes.

9. More Medical Care isn’t Better 45 40 35 30 25 Index of Care (1995-96) 20 15 2 R = 0.01 10 2,000 4,000 6,000 8,000 10,000 Fully Adjusted Medicare Reimbursements per capita (1996)

10. End of Life Care 30% Medicare $ spent in last 6 months of life

11. 11.0 9.0 7.0 Back surgery per 1,000 enrollees 5.0 3.0 1.0 Inpatient Back surgery per 1,000 Medicare enrollees among hospital referral regions (2005) Salt Lake City, UT 5.64 (Intermountain) Danville, PA 5.24 (Geisinger) United States average 4.28 Rochester, MN 3.63 (Mayo) Lebanon, NH 2.26 (Dartmouth)

12. 15.0 13.0 11.0 Knee replacement per 1,000 9.0 7.0 5.0 3.0 Inpatient knee replacement per 1,000 Medicare enrollees among hospital referral regions (2005) Salt Lake City, UT 11.6 Rochester, MN 10.4 Danville, PA 9.0 United States average 8.4 Lebanon, NH 7.8

13. 6.0 5.0 4.0 Hip replacement per 1,000 3.0 2.0 1.0 0.0 Inpatient hip replacement per 1,000 Medicare enrollees among hospital referral regions (2005) Rochester, MN 5.01 Salt Lake City, UT 4.51 Lebanon, NH 3.83 Danville, PA 3.45 United States average 3.36

14. Meet Sheila Context Lest we forget ! Real People My thoughts Care: that is important is often not delivered that is delivered is often not important

15. …Touches So Many Others

16. The Problem Unwarranted Variation in Practice • Supply-sensitive Care (Medical Care) Use of resources is driven by health system capacity and Medicare reimbursement for intensity of care (supply-induced demand) • Preference-sensitive Care • Frequency of use driven by MD opinion (surgery, diagnostic testing)

17. Supply-sensitive Care “Among those with chronic illness, frequency of use of acute care hospitals is the strongest predictor of Medicare spending, not prevalence of chronic disease.And the intensity of care delivered is largely uncoupled from illness.”

18. Supply-sensitive Care 400.0 350.0 300.0 All Medical Conditions 250.0 R2 = 0.54 Discharges per 1,000 Medicare enrollees 200.0 150.0 100.0 Hip Fracture 50.0 R2 = 0.06 0.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 Acute care beds per 1,000 residents Relationship between hospital beds (1996) and discharges (1995-96)

19. Supply-sensitive Care Total Medicare spending for chronically ill patients during the last two years of life, by state (2001-05) 3 fold difference

20. Supply-sensitive Care Mortality is higher in regions where the intensity of care is higher. (quintiles) In other words, patients are at greater risk of dying in regions where the health care system delivers more supply-sensitive care. Elliott S. Fisher, David E. Wennberg, Therese A. Stukel, Daniel J. Gottlieb, F. L. Lucas, and Etoile L. Pinder, “The implications of regional variations in Medicare spending: Part 2. Health outcomes and satisfaction with care,” Annals of Internal Medicine 2003;138:288-298.

21. Supply-sensitive Care Higher Value vs. Higher Intensity Care In regions of the country where patients receive fewer services, providers are not rationing valuable care. Rather, they are averaging higher quality care, greater patient satisfaction, and population-based outcomes that are as good as if not better than those of providers who are delivering more care per capita. They are delivering higher value care.

22. The New Yorker Atul Gawande McAllen, Texas

23. Some key provisions current legislative proposals • Shared decision-making • Comparative effectiveness research • Increased NIH/ AHRQ research funding • Challenge and GO grants • Accountable care organizations • CMS Innovation Center

24. Preference-sensitive Care Most of Musculoskeletal Care Notion of : Informed Consent vs. Informed Choice • Legitimate (evidence-based) treatment choices exist • Choices involve trade-offs for patient’s quality of life • Decisions should be made by a fully-informed patient in partnership with their doctor.

25. Bending the curve…. The well informed Patient gets what they want…$$ saved ! Outliers? Can we narrow the variation?

26. 33 fold Variation (1.4% to 48%) Variation: Rates of Breast Conserving Cancer Surgery Breast conserving surgery (BCS) is the recommended treatment for early stage breast cancer.Who should decide ? Darker colors=higher rates

27. Shared Decision Making for Diagnostic Testing e.g. PSA Disease vs. Pseudo-disease Conclusions After 7 to 10 years of follow-up, the rate of death from prostate cancer was very low and did not differ significantly between the two study groups.

28. Moving Forward ! Preference based decisions Interesting Information but what do we do about it? Solution(s) Which rate is right?Given good information (evidence-based) the Patient should decideShared Decision MakingInformed Choice

29. Actual clinical practice It works ! Preference - sensitive decisions l About 30% of patients change their preference 96% Recommend it !

30. Thinking about Organizations: MEASUREMENT • As we are • As we might become • As we ought to be Informed Choice-SDM Measurement

31. Real-Time Patient Summary Reports Personalize Care** Interconnect Clinicians** InformClinical Practice**Improve Population Health Dr Brailer – EHR- Conference Value Compass

32. SPORT - Spine Treatment Calculator: Questions on PF & Bothersomeness Real Time Decision Support Tools Transparency of Patient reported results

33. How Do We Get There? Benchmarking (examples) Mayo Clinic, Rochester MN. Intermountain Health Care,Utah. Geisinger Clinic, Danforth,Penn. Sutter Medical Center, Sacramento, CA Dartmouth Hitchcock, Lebanon, NH These institutions deliver high quality care (efficiently and economically).

34. Chaordic [kay'ordic] adj. fr. chaos and order: "We must seriously question the concepts underlying the current structure of organizations and whether they are the primary cause of those problems." - Dee Hock Visa Demming (Dartmouth) - “Every systems designed to get the results it gets “

35. Opportunities: National Benchmark Institutions 140,000 120,000 100,000 Medicare spending per decedent 80,000 60,000 40,000 Medicare spending per chronically ill patient during the last two years of life among Los Angeles hospitals and selectedbenchmarksystems (2001-05) Outliers? Rate Ratio to IHC Highest $130,992 2.82 2nd highest $120,756 2.60 75th percentile $93,862 2.02 L.A. hosps avg $84,317 1.82 25th percentile $74,120 1.60 2nd lowest $63,661 1.37 Lowest $61,239 1.32 Sutter(Sacramento)$50,718 1.09 Mayo (Rochester) $50,273 1.08 IHC (SLC/Ogden) $46,377 1.00

36. 100 100 Miami 100 90 90 90 Florida 80 80 80 Charlotte Fawcett Regional Memorial 70 70 Peace River 70 60 60 60 Naples Comm. Fort Percentile of HCI based on U.S. distribution 50 50 50 Myers Cleveland Clinic 40 40 40 Lehigh Reg. 30 30 30 Lee Memorial Cape Coral 20 20 SW FL Reg. 20 10 10 10 0 0 0 Local Benchmarks-Florida Hospital Care Intensity index for states (left), Florida HRRs (center), and Fort Myers area hospitals (right) (2001-05) FLORIDA STATES FT. MYERS

37. 100 99 98 Westchester Mount Sinai 97 Hialeah Palm Springs Larkin Comm. Aventura 96 Cedars Pan American Parkway Reg. 95 North Shore Coral Gables Mercy Hospital Percentile of HCI based on U.S. distribution 94 Kendall Reg. Palmetto Gen. 93 South Miami 92 Baptist Hospital 91 90 89 88 Jackson Memorial Local Benchmarks-Florida Hospital Care Intensity index for Miami area hospitals (2001-05) Outliers?

38. Implications for Reform • Currently, low-cost regions, where providers are relatively efficient, are subsidizing relatively inefficient providers in high-cost regions. (transfer payments) • From 2001 to 2005 over-utilization increased 18% in high-intensity regions vs. 11% in low-intensity, more efficient regions. • Patients in Miami (high intensity) averaged $5,000 in co-pays vs. $1,500 for patients in Minneapolis (low intensity)

39. 2Xmore Likely to spend time in the ICU Overuse can significantly alter a patient’s Quality of life

40. How Do They Do It? Regions with low Medicare spending profiles— e.g. those in the bottom 20% of regions on per capita spending — are typically served by Organized Systems of Care • large group practices or • integrated hospital systems.

41. Supply Induced Demand 4.0 Standardized ratio (log scale) 1.0 0.3 Physician labor RN labor requirement Hospital beds ICU beds MORE LABOR/FACILITIES PER PATIENTPhysician labor, inpatient registered nurse requirements, and bed inputs per 1,000 chronically ill patients during the last two years of life among Los Angeles hospitals and selected benchmark systems Benchmarks Mayo (Rocheter) Geisinger Intermountain

42. Nationally If all providers in the country were to achieve the efficiency for inpatient spending on supply-sensitive care, 28 percent reductionunder aMayo benchmarkand a 43 percent reductionunder an Intermountain benchmark:Savings ~=min.$374 billion*. *Kaiser Foundation Fact Sheet Medicare: Medicare Spending and Financing, June 2007.

43. Promoting Organized Systems of Care Key Components • Emphasis on coordinated, community-based care over course of chronic illness • Measurement and reporting of performance and patient outcomes It’s all about the Delivery System efficient and effective use of resources

44. Iowa City,IA vs. Mc Allen,TX Bending the Cost Curve

45. Moving Forward ! Preference based decisions Interesting Information but what do we do about it? Solution(s) Which rate is right?Given good information (evidence-based) the Patient should decideShared Decision Making

46. Preference Sensitive Care Promote Informed Patient Choice

47. Actual clinical practice It works ! Preference - sensitive decisions l About 30% of patients change their preference 96% Recommend it !

48. Knowledge Fusion - 20 fold variation (highest of all)

49. Geography is Destiny ! Unexplained Practice Variations Dollars and Sense Locally If, over the 2-year period 2000-01, the Miami per person spending rate for the 4 procedures had prevailed in Fort Myers, $19.6 million would have been saved in Fort Myers. If the Fort Myers spending rate had prevailed in Miami, $21.7 million more would have been spent in Miami. Nationally If Miami spending had been the national standard, $1.3 billion would have been saved in the U.S. over the two-year period, but If Fort Myers spending had been the national standard, there would have been $2.1 billion in additional spending.

50. Overhaul Informed Consent Laws • Washington State explicitly endorses ‘informed patient choice’ as the preferred standard of practice and grants physicians who use patient decision aids greater immunity from failure-to-inform malpractice suits currently provided under informed consent provisions. • Support informed choice demonstration models in clinical practice settings