Aiming Higher: Results from a State Scorecard on Health System Performance, 2009

October 8, 2009

Authors: Douglas McCarthy, M.B.A., Sabrina K. H. How, M.P.A., and Cathy Schoen, M.S., The Commonwealth Fund

Joel C. Cantor, Sc.D., and Dina Belloff, M.A., Rutgers University Center for State Health Policy

Prepared for the Commonwealth Fund Commission on a High Performance Health System


State Scorecard Map Use this map to view state-specific rankings and results, and to view the number of lives and dollars each state could save by achieving benchmark levels of performance. Also check out the comparison tool to select years, performance indicators, and states and then generate custom tables and bar charts.

Highlights and Cross-Cutting Themes

Leading states consistently outperform lagging states across indicators and dimensions; public policy and public–private collaboration can make a difference.

Maine, New Hampshire, Massachusetts, Connecticut, North Dakota, Wisconsin, Rhode Island, South Dakota, and Nebraska—again rise to the top quartile of the overall performance rankings (Exhibit 1). Though specific rankings shifted, these are the same
group of states identified as top performers in the first State Scorecard two years ago. Many have been leaders in reforming and improving their health systems—for example, by targeting efforts to reduce rates of uninsured adults and children.

Ten of the 13 states in the lowest quartile of performance—Tennessee, Alabama, Florida, Kentucky, Texas, Nevada, Arkansas, Louisiana, Oklahoma, and Mississippi—also ranked in the bottom quartile in the 2007 State Scorecard. Three others—North Carolina, Illinois, and New Mexico—dropped from the third quartile, while California, West Virginia, and Georgia moved up out of the last quartile. The 13 states in the lowest quartile lagged well behind their peers on indicators across dimensions of performance. Rates of uninsured adults and children are, on average, double those in the top quartile of states. Receipt of recommended preventive care is generally lower, and mortality from conditions amenable to health care is, on average, 50 percent higher in these states than in leading states.

Among the states that moved up the most in the overall performance rankings, Minnesota rose within the top quartile to become the fourth-ranked state, with significant improvement on multiple indicators. In three states—Arkansas, Delaware, and West Virginia—plus the District of Columbia, at least half of the performance indicators improved by 5 percent or more. Leading states set new benchmarks for 20 of the 35 indicators with trends.  These patterns indicate that public policies, plus state and local health care systems, can make a difference. Vermont, Maine, and Massachusetts, for example, have enacted comprehensive reforms to expand coverage and put in place initiatives to improve population health and benchmark providers on quality. Minnesota is a leader in bringing public and private-sector stakeholders together in collaborative initiatives to improve the overall value of health care—an approach that is gaining traction in other states. As New York and Utah have made concerted efforts to improve their performance in priority areas, these states' performance on key indicators has improved. Yet socioeconomic factors also play a role. Many of the states that ranked low on multiple performance indicators have high levels of poverty, making it difficult to provide affordable coverage without federal action.

Wide variations in access, quality, costs, and health outcomes persist across states.

Overall, the range of performance remains wide across states and across dimensions of performance, with a two-to-three-fold spread between top- and bottom-performing states on multiple indicators (Exhibit 2). On many indicators, the leading states have improved substantially since the 2007 State Scorecard—setting new benchmarks.

The divergence in performance is particularly wide when it comes to the following indicators: percentage of insured; diabetic patients receiving recommended care; mental health care for children; pressure ulcers in nursing homes; preventable hospital admissions; and mortality amenable to health care. To reach the level of top-performing states, bottom-performing states would need to improve by an average of 40 to 50 percent.

Improving the performance of all states to the levels achieved by the best states could save thousands of lives, improve access and quality of life for millions of people, and reduce costs. In turn, this would free up funds to pay for improved care and expanded insurance coverage—producing a net gain in value from a higher-performing health care system. If all states could match benchmarks set by the top-performing state, the cumulative effect would mean:

  • Nearly 78,000 fewer adults and children would die prematurely (before age 75) each year from conditions amenable to health care.
  • The number of people without health coverage would be more than halved, with 29 million more people insured.
  • Nine million more adults (age 50 and older) would receive all recommended preventive care, and almost 800,000 more young children would receive key vaccinations on time.
  • Four million more diabetic patients across the nation would receive basic services to help avoid complications such as blindness, kidney failure, or limb amputation.
  • At least $5 billion would be saved from avoiding preventable hospitalizations and readmissions for chronically ill or frail elderly nursing home patients.
  • Savings of $20 billion to $37 billion per year would be possible if annual per-person costs for Medicare in higher-cost states fell to the median state rate or to the average rate achieved in the top quartile of states.

Geographic variations remain striking, repeating the same general patterns seen in the first State Scorecard. States in the Upper Midwest and New England continue to lead, and states across the South, the Southwest, and the Lower Midwest continue to trail those in other regions on overall performance rankings. This pattern generally holds for the access, quality, and equity dimensions, though western states tend to perform better on avoidable hospital use and costs of care and on the "healthy lives" dimensions (Exhibit 1). Yet exceptions also exist, especially where states and care systems have made a concerted effort to improve.

Improvements in key areas of health care quality are promising.

The State Scorecard also documents widespread improvement across states on selected indicators, especially quality indicators for which there has been a national commitment to reporting performance data and collaborative efforts to improve. Notably, for some indicators of hospital clinical processes, the average performance of the bottom-ranked states now exceeds the median state rate of three years ago, with virtually all states improving (Exhibits 2 and 3).

These indicators include treatment for heart attack, heart failure and pneumonia, prevention of surgical complications, and provision of written discharge instructions for heart failure patients. Exhibit 2S

Publicly reported quality measures related to the delivery of patient-centered care in nursing homes also improved substantially across states. The average state performance on reported pain and use of physical restraints on residents improved by at least
5 percent in all states, and in the majority of states average performance improved by the same amount for a measure of pressure ulcers; the range of performance between states narrowed as well. One key measure of home health care quality—improvement
in patients' mobility—also showed a 5-percent-or-greater improvement in most states.

Currently, all hospitals are required to publicly report selected quality indicators in return for payment updates from Medicare. Several public and private initiatives have further tied payment incentives to hospitals' improvement on such metrics. The
rapid improvement in a relatively short time illustrates the importance of data in guiding and driving change, as well as the necessity of having incentives in place to foster higher performance. In contrast, hospital readmission rates and several quality indicators that generally are not publicly available at the delivery-system level failed to improve or evidenced mixed performance across states. A general trend toward lower rates of mortality amenable to health care, cancer deaths, and smoking is also promising, although most states' death rates substantially exceed rates achieved by the benchmark states.

Unfortunately, these large gains were not matched in other areas. For example, there were only modest improvements seen in preventive care for adults—and in only half the states. The majority of states failed to improve on multiple indicators of ambulatory care quality and access over the two-to-four-year trends typically captured by the 2007 and 2009 scorecards. Many indicators of avoidable hospital use and costs of care failed to improve or grew worse, especially hospital admissions and readmissions from nursing homes—highlighting the need for better coordination of care across care settings. It should be noted that the data related to access to care reflect the period prior to the current economic recession, which has likely worsened access for adults. Similarly, the data predate the extension of CHIP, which may be helping to offset the recession’s impact on children.

On 20 of 35 indicators for which trend data are available, the median state rate (representing the middle of the range) failed to improve or declined by 5 percent or more. Only 15 indicators improved by 5 percent or more, mainly in the quality domain (Exhibit A2). Disturbingly, the range of performance across states widened on a third of indicators—often in tandem with a decline across states.

Making continual improvement the norm across all performance indicators and in all states will require national as well as state policies that ensure access to care, realign incentives, set targets, and make available the information needed to effect change. Robust measures of outcomes are needed as well to drive transformative system change; "process" indicators alone are not enough. It is also clear that improving care one disease or process at a time will not be an effective approach to achieving high performance across the board.

Symptoms of poor care coordination and inefficient or suboptimal use of resources point to opportunities to improve both quality and cost.

Exhibit 3S The State Scorecard points to evidence of gaps in care and fragmented care that reflects health system dysfunction: the failure to provide timely and effective preventive and chronic care; high and, in many states, increasing hospital readmission rates; and rising hospitalization rates for nursing home residents and home health care patients across most states. Despite improvement, rates of potentially preventable hospitalizations remain relatively high in many states. And the gaps in receipt of recommended preventive care such as cancer screenings and immunizations across states underscore the need for a stronger primary care infrastructure in the United States.

Annual costs of health care (average employer-group premiums for individuals and Medicare spending per beneficiary) vary widely across states, with no apparent systematic relationship to insurance coverage or ability to pay (as measured by median income). Moreover, across states there is no systematic relationship between scorecard indicators of the cost and quality of care across states. Some states in the Upper Midwest (e.g., Iowa, Minnesota, Nebraska, North Dakota, and South Dakota) achieve high quality at lower costs. Although these states are exceptions to the rule, they provide examples for other states to follow in pursuit of both goals.

States with higher medical costs tend to have higher rates of potentially preventable hospital use, including high rates of readmission within 30 days of discharge (Exhibit 4) and high rates of admission for complications of diabetes, asthma, and other chronic conditions. Reducing the use of expensive hospital care by preventing complications, controlling chronic conditions, and providing effective transitional care following discharge has the potential to improve outcomes and lower costs.

Affordability is a growing concern throughout the states.

In most states, health insurance premiums have been rising faster than household incomes. Using average employer-sponsored insurance premiums (including the employee share) for individual employees as a proxy for average insurance costs in each state, the State Scorecard finds that by 2008, average premiums amounted to 16 percent or more of median household income in 37 states, compared with 16 states five years earlier (Exhibit 5). In 18 states, premiums amounted to 18 percent or more of median income for the under-65 population. By 2008, only three states (Colorado, New Jersey, and Maryland) had premiums averaging under 14 percent of median income.Exhibit 4S

This upward pressure on the cost of health coverage has led to erosion in the generosity of insurance benefits, which in turn has increased the number of "underinsured" individuals and caused others to lose their coverage entirely. Reversing these trends will require a dual focus on "bending the cost curve" as well as action to secure affordable coverage for all.

There is room for improvement across all states.

All states have substantial room to improve. No state ranked in the top quartile across all performance indicators. On some indicators, even the top rates are well below what should be achievable. In each of the states with the highest overall rankings, several indicators declined by 5 percent or more; each also had some indicators in the bottom quartile or half of performance. At the same time, in each of the lowest-ranked states, there were certain areas of performance that improved—some quite significantly.

While leading states such as Massachusetts, Minnesota, and Vermont have enacted policy reforms that are extending coverage, promoting community health, and building value-based purchasing strategies through public–private collaboration, this
has not been the case in the vast majority of states. Encouraging the adoption of systemic improvements will likely require Medicare's participation in state payment initiatives and will require collaborative federal and state efforts to develop the information
and shared resources infrastructure necessary to achieve high performance.