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Wisconsin: Private and Public Sectors Partner to Promote Transparency

Profile: In-Depth Look at an Initiative that Is Making a Difference

Wisconsin: Private and Public Sectors Partner to Promote Transparency

Summary: Public and private stakeholders—including businesses, hospitals, physicians, insurers, state employees, and the state Medicaid program—are collaborating to collect, compare, and publicly report information about the costs and quality of health care in Wisconsin. The state committed public funds to the creation of a database of health care information intended to enhance the transparency, quality, and efficiency of the health care system.

In Wisconsin, there are a number of ongoing efforts intended to promote the transparency and, eventually, improve the performance of the health care system. Public and private stakeholders are collecting information on the quality and costs of health care at the physician, hospital, and health plan levels in order to make reliable, comparative data available to providers, employers, and consumers. The groups are working together and building on each others' work, rather than duplicating efforts.

Health Care Transparency Legislation
In late March, Governor Jim Doyle signed the Health Care Transparency Bill (AB 907). The legislation dedicates state funds to the Wisconsin Health Information Organization (WHIO), a coalition of managed care companies, employer groups, health plans, physician associations, hospitals, and doctors. Created in 2005, the coalition is building a centralized health data repository based on voluntary reporting of private health insurance claims. The database will include health care claims as well as pharmacy and lab data from insurers, self-funded employers, and health plans. Such information will be used to develop reports on the costs and, eventually, the quality of care. The goals are to encourage providers to improve their performance and enable employers and consumers to make informed purchasing decisions.

Both the Wisconsin Department of Health and Family Services (DHFS), which administers the state's Medicaid program and State Children's Health Insurance Program (SCHIP), and the Wisconsin Department of Employee Trust Funds (ETF), which as the state's largest employer manages health benefits for state and some local employees and retirees, are participating in the initiative. DHFS and ETF will contribute data on the costs of publicly paid health care through Medicaid and public employee benefit systems. For ETF, this is one component of a "value-based purchasing" model it has been employing for nearly four years. [1]

To finance the effort, each private member group makes a contribution, which the state will match through funds derived from assessments on physicians and a small contribution by ETF.

By supporting the WHIO initiative, the state hopes to:

  • facilitate quality improvement efforts by private providers;
  • help consumers make well-informed purchasing decisions;
  • inform public health efforts such as disease surveillance; and
  • secure value for money in public programs such as Medicaid, the state's biggest purchaser of health care.

Web-Based Reporting Tool
WHIO complements another initiative, the Wisconsin Collaborative for Healthcare Quality (WCHQ). Founded in 2003, the WCHQ collaborative involves physician groups, hospitals, health plans, employers, and labor organizations that want to enhance transparency and promote quality in the health care system. According to Chris Queram, the group's president and CEO, "the physician and hospital leaders who founded WCHQ were willing to admit that there are too many mistakes, too much variation from evidence-based care, and that the system could and should do better."

WCHQ publicly reports comparative information on its member physician practices, hospitals, and health plans through an interactive Web-based tool. The reports are organized into measures of five of the six dimensions of health care quality proposed by the Institute of Medicine as well as topics of particular interest to patients, such as access, use of information technology, heart care, pneumonia, and patient satisfaction. [2] There are also measures of diabetes, hypertension, and postpartum care.

The WCHQ has earned credibility among health care providers because the measures are reported in ways that allow member groups to identify variation by physician practice and target areas for improvement. For example, this chart on diabetes management displays the percentage of diabetes patients at different physician groups that has achieved optimal blood sugar levels.

Recently, WCHQ developed and unveiled a quadrant analysis to demonstrate the relationship between quality outcomes and risk-adjusted charges. This innovative approach to quantifying the value each member hospital provides when caring for patients with specific conditions was developed in response to the business community's desire for a more sophisticated measure of a hospital's efficiency.

For example, Figure 1 displays the quality-cost relationship in terms of heart attack care; each hospital is represented by a diamond and letter. It indicates that the vast majority of hospitals are performing above the national median in terms of providing heart attack patients with recommended, evidence-based care, yet their charges for heart attack care vary widely.[3] This might lead purchasers to question why they should pay twice as much to some hospitals when most are providing recommended care.

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Source: WCHQ website, reproduced with permission of WCHQ. On an anecdotal basis, the WCHQ web-based tool is having a positive effect on provider performance; according to Queram, public reporting "catalyzes the commitment to improve quality." The overall trend for most of the measures is moving in the direction of improvement. WCHQ is planning an evaluation to assess the impact of the initiative and inform efforts to make it more effective.

The WCHQ, WHIO, and similar public reporting initiatives share the challenge of encouraging consumers and employers to use cost and quality information in their purchasing and care choices. WCHQ recognizes the need to make its Web tool easier for consumers to navigate and is considering working with consumer organizations to determine how to do this.

Queram notes that, although employers are interested in the performance data, most do not offer financial or other incentives to steer workers toward better-performing health providers. Some use the data in other ways, however. For example, the Alliance—a Wisconsin employer health care cooperative—draws on the WCHQ diabetes measures in rate negotiations in their pay-for-performance program. Employers might eventually be persuaded to act on the findings in other ways, for example by changing health plans or providers.

Another challenge is to convince all physicians—not just the current few who are actively involved in data collection —that performance data can help physicians to improve their practices.

Over the long run, the Wisconsin initiatives will need to develop a sustainable business model for health information collection and reporting. This will require commitment from the private and public sectors and evidence that these efforts work—that they encourage purchasers, consumers, and health providers to change their behavior and lead to in higher quality and more efficient care.

[1] For example, ETF has already implemented a pay-for-performance program, a tiered premium structure, and an evidence-based drug formulary.
[2] The five dimensions currently included in the database are safety, timeliness, effectiveness, efficiency, and patient-centeredness. Equity, the sixth dimension, is difficult to define and measure consistently with currently available data.
[3] The composite score median was calculated based on available national data sets while the mean charge and length of stay was calculated based on Wisconsin data.

For More Information
Contact: Chris Queram, President and CEO, Wisconsin Collaboration for Healthcare Quality, Inc, [email protected], (608) 250-1505

Susan Wood, Health Chief of Staff, WI Department of Health and Family Services, [email protected]
Nancy Nankivil Bennett, Director of Strategic Health Policy, WI Department of Employee Trust Funds, [email protected]


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