Archived: Health System Improvement and Efficiency

This program is now closed.

Program Goals

The Program on Health System Quality and Efficiency was a major part of The Commonwealth Fund’s focus on health care delivery system improvement and innovation. The program’s mission was to improve the quality and efficiency of health care in the United States, with special emphasis on fostering greater coordination and accountability among all those involved in the delivery of health care.

The program’s work was rooted in the recognition that improvements are most likely to occur when the need for change is understood, measured, and publicly recognized; when providers have the capacity to initiate and sustain change; and when appropriate incentives are in place. To that end, the program supports projected that:

  • assess the capacity of organizations to provide coordinated and efficient population-based care, and help expand that capacity where necessary;
  • foster the development and widespread adoption of standard measures for benchmarking the performance of health care organizations over time; and
  • promote the use of incentives to improve quality and efficiency in health care.  

The Issues

The quality and efficiency of American health care is not what it should be. While the basic skill and dedication of the nation’s health care providers is not in question, there are ample opportunities for improvement in quality, safety, coordination, and patient-centeredness throughout the health care system.

According to The Commonwealth Fund’s 2011 National Scorecard on U.S. Health System Performance, as many as 91,000 fewer premature deaths would occur if the United States were to reach the benchmark level of “mortality amenable to health care” achieved by the top-performing country. Given the nation’s standing as the world’s biggest spender on health care, our system is clearly inefficient as well. Supporting efforts that increase the value obtained from our health care dollars is one of the Fund’s chief goals.

Recent Projects

Redesigning Care for High Performance
Hospitalizations consume nearly one-third of the $2 trillion spent on health care in the U.S. Many of these are readmissions for conditions that could have been prevented had patients received proper discharge planning, education, and support. In 2009, the Institute for Healthcare Improvement (IHI), with Commonwealth Fund support, initiated State Action on Avoidable Rehospitalizations (STAAR), a multipronged effort to help hospitals improve their processes for transitioning discharged patients to other care settings and assist state policymakers and other stakeholders with implementing systemic changes that sustain improvements. As reported in Health Affairs (July 7, 2011), the most important rehospitalization-reduction strategies used so far include: improving patient education; ensuring timely follow-up with patients after hospital discharge; creating “cross continuum” care teams comprising staff from hospitals, skilled nursing facilities, home health agencies, and primary care practice; and using universal patient transfer or discharge forms. To date, 167 STAAR hospitals in three states have joined more than 500 community-based partners, including nursing homes, home health agencies, and physician practices, in the push to improve care transitions.

STAAR is also informing national efforts to reduce rehospitalizations, highlighting the value of collaboration among hospitals and community-based providers for improving care transitions and keeping discharged patients out of the hospital. The initiative has produced a number of how-to guides and other resources—all available online—to help providers implement best practices for good transitional care.

Nearly one-quarter of patients hospitalized with heart failure and one-third of patients hospitalized with acute myocardial infarction (AMI) are readmitted within 30 days of discharge, despite evidence that a substantial portion of readmissions may be preventable. While these and other readmissions increase Medicare costs by an estimated $17 billion per year, little is known about the extent to which hospitals have employed recommended strategies to reduce readmission risk. As part of a Commonwealth Fund–supported study, Elizabeth Bradley, Ph.D., and her team at Yale University surveyed more than 500 U.S. hospitals enrolled in the American College of Cardiology and the Institute for Healthcare Improvement’s “Hospital to Home” initiative to determine their use of 10 practices associated with lower readmission rates.

The results, published in the Journal of the American College of Cardiology (July 2012), show that hospitals’ use of recommended practices to reduce readmission rates varies significantly. On average, hospitals used five of 10 key practices, while only 3 percent of hospitals used all 10 practices. Such infrequent use of best practices may reflect insufficient resources, constraints on staff time, and the complexity of coordinating efforts among physicians, pharmacists, nurses, and other staff.

To help hospital leaders get started on a plan for reducing readmissions, a team of experts at the Health Research and Educational Trust (HRET) produced the Health Care Leader Action Guide to Reduce Avoidable Readmissions, with support from the John A. Hartford Foundation and The Commonwealth Fund. This resource outlines strategies for reducing unplanned readmissions and enables hospitals to estimate the level of effort required for them to implement those strategies.

Significant variability in 30-day readmission rates across U.S. hospitals suggests that some are more successful than others at providing safe, high-quality inpatient care and promoting smooth transitions to follow-up care. A Commonwealth Fund report by Sharon Silow-Carroll of Health Management Associates offers a synthesis of findings from case studies of four hospitals with exceptionally low readmission rates. The four are all part of integrated health systems, and each has responded effectively to local health care market conditions and the policy environment.

Douglas McCarthy, senior research adviser to The Commonwealth Fund, has also profiled health care organizations that have produced exemplary results in improving care transitions and reducing hospital readmissions. In a new case study series, McCarthy highlights the efforts of UCSF Medical Center in San Francisco, part of the University of California system, which demonstrate what an organization can achieve in the absence of explicit financial incentives to reward desired behavior; Cincinnati Children’s Hospital Medical Center, which is scaling up a program for children with asthma to the community level; and the Visiting Nurse Service of New York’s CHOICE program, which is integrating health care services for Medicare/Medicaid dual eligibles.

Accountable Care Systems
As the nation moves toward health care delivery systems that are accountable for the health outcomes and costs of caring for their patient populations, The Commonwealth Fund is sponsoring efforts to ensure the success of this model for achieving coordinated, patient-centered, efficient care. With Fund support, Elliott Fisher, M.D., and his colleagues at the Dartmouth Institute for Health Policy and Clinical Practice and the Brookings Institution developed and pilot-tested a “starter set” of health care claims–based measures that could be used to assess quality of care and to determine payments to accountable care organization (ACO) providers and the shared savings for which they are eligible. The team has also recommended testing a more advanced set of measures, including clinical outcomes measures and patient-reported measures of care experience and health status.

In the project’s second phase, the team developed a framework for evaluating ACOs and applied it to a series of case studies of four diverse health care organizations—from integrated health systems to a community hospital—that are collaborating with their private-payer partners to become accountable care providers. The cases detail how these institutions, which are all taking part in the Brookings–Dartmouth ACO Pilot Program, formed their ACO partnerships, how they are developing the capacity to manage population health, quality, and costs, and how they address issues of governance, patient attribution, payment, patient and provider engagement, and benefit design.

For ACOs to succeed, payment methods need to foster greater organizational accountability for patient care quality and cost. The Commonwealth Fund is supporting a multiyear evaluation to compare changes in spending and quality for providers participating in one such payment model: the Alternative Quality Contract (AQC), a global payment system developed by Blue Cross Blue Shield of Massachusetts (BCBS) to replace fee-for-service reimbursement and counter rising health care spending. Under the contract, Blue Cross Blue Shield makes a comprehensive payment to health care providers that covers the entire continuum of a patient’s care for a specific illness—including inpatient, outpatient, rehabilitative, and long-term care services, as well as prescription drugs. Providers are eligible for a performance bonus if they meet certain quality targets.

With Fund support, Harvard University’s Michael Chernew, Ph.D., evaluated spending and quality improvement for patients whose primary care providers participated in the AQC, and did the same for a control group of patients whose providers did not take part. In a Health Affairs paper (July 2012), Song and colleagues reported that Massachusetts physician groups signed on to the AQC were able to reduce the rate of increase in health care spending over two years by an average of 2.8 percent. The savings and improvements in quality appear to be sustained, and were even greater in year 2 compared with year 1. Savings accrued largely from reduced spending for procedures, imaging, and lab tests.

The ACO programs implemented by the Centers for Medicaid and Medicare Services (CMS)—the Shared Savings Program, the Pioneer Program, and the Advanced Payment Program—are intended to improve quality and slow cost growth. The ACO model is based on an earlier pilot, the Medicare Physician Group Practice Demonstration, in which 10 physician groups were eligible for up to 80 percent of any savings they generated if they were also able to demonstrate improvement on 32 quality measures. Although evidence indicates the groups in the demonstration improved quality, uncertainty remains about the impact on costs. Writing in the Journal of the American Medical Association (Sept. 12, 2012), Fisher, together with Carrie Colla, Ph.D., and colleagues, reported that nearly all the aggregate savings were concentrated among Medicare/Medicaid dual eligibles.

The Fund also supported the Hospital Research and Education Trust (HRET) to conduct the first national survey of hospital readiness to form ACOs. The survey asked leaders of nearly 1,700 hospitals about their care management, financial management, information systems, and performance improvement practices. The HRET report, based on the results provides hospital leaders with a tool to gauge their organizations’ relative preparedness for ACO participation.

Survey data was also the basis of a Commonwealth Fund issue brief (Aug. 2012) that describes the start of the ACO adoption curve. The findings suggest that ACOs are embarking on a paradigm shift, moving away from an acute care focus and toward primary and preventive care. The authors, led by Fund vice president Anne-Marie J. Audet, M.D., also find that aspiring ACOs must develop the infrastructure to take on financial risk and manage population health.

In partnership with Stephen Shortell, Ph.D., of the University of California, San Francisco, the Dartmouth team is currently conducting the first national survey of ACOs to obtain information about the characteristics and circumstances that influence their formation, structure, contracts, and capabilities.

Meeting and Raising Benchmarks for Quality
Today, nearly 7,500 hospital executives, quality improvement professionals, medical directors, business coalitions, state health agencies, and others use WhyNotTheBest.org, The Commonwealth Fund’s online resource for health care quality benchmarking, to compare their organization’s performance against peers, learn from case studies of top performers, and access innovative improvement tools. With an array of custom benchmarks available, users can compare their organization’s performance to the leaders and to national and state averages.

WhyNotTheBest profiles more than 8,000 hospitals and 400 hospital systems on measures of appropriate care processes and outcomes, patient experiences, readmission rates, mortality rates, patient safety and use of resources. The site also reports on the incidence of central line–associated bloodstream infections for more than 1,300 U.S. hospitals, and it serves as a unique source of all-payer data across 12 states. In the past year, the site added new functionalities so that users can compare performance by various categories—for example, safety-net, rural, or urban. Users can also examine aggregated hospital performance by state, county, or hospital referral region. Additional efforts this year will focus on outreach to new audiences, such as employers, and health services researchers.

Publicly available data can also drive improvement in health care. In recent years, physician and hospital “report cards” have proliferated in recent years. While consumers seem to value them, they can be difficult to understand and use, and so far they seem to have had little influence on people’s health care provider choices. For a Fund-sponsored Health Affairs study (March 2012), researchers at the Harvard School of Public Health, led by Anna Sinaiko, Ph.D., and Meredith Rosenthal, Ph.D., synthesized the views of experts and stakeholders about what needs to be done to make provider report cards more useful. There was broad consensus that report cards should offer a greater number of consumer-oriented measures, be more clear and accessible, and contain a wider range of data, including information on cost.

Assessing Providers’ Capacity to Improve Care
Although deaths from heart attack have decreased significantly over the past decade, there is still substantial variation across U.S. hospitals in the number of patients who die within 30 days of hospitalization for acute myocardial infarction. Certain variables, such as medication adherence, can improve these rates, but less is known about strategic factors like communication and problem-solving. Based on a survey of more than 500 acute care hospitals, a Fund-supported research team led by Yale’s Elizabeth Bradley, Ph.D., identified low-cost, low-risk strategies that together could lower risk-standardized mortality by more than 1 percent and save thousands of livers annually. Among the strategies described in the authors’ May 2012 Annals of Internal Medicine article are: holding monthly meetings with hospital clinicians and staff who transported patients to the hospital; having on-site cardiologists; and encouraging clinicians to engage in creative problem-solving.

Disseminating Best Practices and Innovative Models
Case studies and evaluations of high-performing provider organizations can be a highly effective in educating health care stakeholders about best practices for managing chronic diseases, reducing hospitalizations, increasing patient satisfaction, and achieving other important performance goals. A recent Commonwealth Fund–sponsored study undertaken by Geoffrey Lamb, M.D., of the Medical College of Wisconsin sought to assess the link between public reporting on diabetes care and physicians’ activities to improve the quality of care they provide to patients. His research team focused on primary care doctors participating in the Wisconsin Collaborative for Healthcare Quality, a designated Chartered Value Exchange Network and leader in public reporting and best-practice sharing. According to survey results reported in Health Affairs (March 2012), public reporting helped drive early adoption of diabetes care improvement activities in clinics participating in the collaborative, including patient registries and care reminders, and also seems to have led to clinics adopting multiple improvement interventions over time.

At the Group Health Cooperative in Washington State, David Arterburn, M.D., led the first large-scale observational study to assess the effectiveness of patient-decision aids on the use of elective surgical procedures, total health care use, and total costs. The results, published in Health Affairs (Sept. 2012), show that the introduction of decision aids was associated with 26 percent fewer hip replacement surgeries, 38 percent fewer knee replacements, and 12 percent to 21 percent lower costs over six months.

Future Directions

A number of projects sponsored by the Health System Quality and Efficiency program will begin yielding results over the coming year:

  • Karen Donelan, Sc.D., of Massachusetts General Hospital and Catherine DesRoches, Ph.D., of Mathematica Policy Research recently fielded a longitudinal national survey to learn about the organizational settings and local health care markets in which physicians practice, as well as their care coordination processes and relationships with other providers, forms of reimbursement, and use of health information technology.
  • Under a Fund grant to the University of Oregon, Jessica Greene, Ph.D., is evaluating the impact of provider payment reforms instituted by Fairview Health Services, an integrated health system in Minnesota that is discarding fee-for-service and replacing it with payment based on quality of care, productivity, patient experience, and cost.
  • The 17 U.S. communities chosen to participate in the federally authorized Beacon Community Cooperative Agreement Program are currently engaged in efforts to build and strengthen their health IT infrastructure to achieve improvements in health care quality, cost-efficiency, and the management of community-level population health. With a combination of Commonwealth Fund and federal support, AcademyHealth has launched the Beacon Evaluation and Innovation Network to assist the Beacon Communities in accelerating the identification, documentation, and dissemination of lessons and results of their individual efforts. Two forthcoming Fund case studies will describe what selected Beacon Communities are learning, how they are evaluating their efforts, and what implications can be drawn from their experience for policy and practice.