Episode 03: Paying for Safety

Join special guests Jessica Brooks, MPM, president & CEO of the Pittsburgh Business Group on Health and CEO & founder of US Health Desk, and Nancy Guinto, MHA, executive director of the Washington Health Alliance, as they explore the financial incentives that impact health care at every level in the United States. If safety is going to improve, what needs to change in the healthcare economy, and what progress and solutions are available to impact safety today?

Listen to this episode on: Apple Podcasts | Google Podcasts | Spotify

Featured Speakers

Referenced Resources (in order of appearance)

Episode Transcript

[00:00:00] Karen Wolk Feinstein: Welcome back to Up Next for Patient Safety. This is our third podcast in a series and I’m your host, Karen Feinstein. I’m president and CEO of the Jewish Healthcare Foundation and it’s three operating arms, which includes the Pittsburgh Regional Health Initiative. On today’s episode, we’re going to be talking about healthcare payment and how changing the way we pay for care could make our care safer. If you think this is a boring topic, you’re wrong, and our speakers will make it even more lively. In fact, new approaches to how we pay hospitals, doctors and health systems could guarantee that safety will become a top priority in the near future.

The big question we addressed today is how do we get hospitals, health systems and doctor’s offices to want to adopt greater safety protections? Even if they’re automated, the new protections, and they’re easy to adopt and install, and simple to execute… there’s still some cost and some disruption. And a National Patient Safety Board even if established, will issue recommendations. It doesn’t set regulations. It doesn’t enforce new solutions. So, consider how little incentive there is right now for investing in safer and even the safest care possible if you’re a health system. There’s a cost to getting practices and hospitals to change the way they provide care to install new technologies and apply advanced analytics so they can prevent accidents before they even happen.

What about other industries? Why do airlines or nuclear power plants, or even the manufacturers of their equipment invest in safety? Because think about this, if they’re unsafe, people won’t buy their services. They won’t ride on their planes or their trains or a federal agency could close their facilities and in effect they’d go out of business.

But as we all know, hospitals and health systems don’t go out of business, they don’t get shut down because of errors and their patients and purchasers can’t choose the safest system often because the information isn’t even available on safety records. And when it is available, it can be confusing or contradictory from different sources. Much of the information we need isn’t even available to patients and their families.

And here’s a surprise! Healthcare systems get paid the same amount, if they’re excellent or just comfortably mediocre, or even less than average on safety. But that could be about to change. And that’s what we’re going to talk about today. So, let’s look more closely at one magic bullet that might inspire those who provide health services to become decidedly more safe. I’m talking about something called value-based purchasing as the next new thing. It’s on the table for the government at Medicare & Medicaid, and private insurers, like Blue Cross Blue Shield, United, or other private insurance. So we’re going to take an exploration, a journey into value-based purchasing today.

I have two terrific guests to do that. Nancy Guinto and Jessica Brooks. Nancy’s the executive director of the Washington Health Alliance, a multi-stakeholder nonprofit that offers objective reporting of progress on measures of healthcare, quality, safety, and value. It’s also a trusted forum for important conversations about health system improvement. Nancy joined the Alliance since September of 2014 and she’s looked in some depth at the organization’s strategic direction, its legislative agenda, it’s continued expansion across the state, and publication of new reports. Nancy’s organization is well-known for its credibility and substance.

Jessica, my friend from our community, is president and CEO of the Pittsburgh Business Group on Health and the CEO & founder of the U.S. Health Desk. The Pittsburgh Business Group on Health is an employer-led nonprofit coalition and represents all kinds of organizations and business segments, public and private employers, government education, and others, like the Pittsburgh Regional Health Initiative. The Health Desk is a real-time solution for patients who are facing harm or have had harm done to them from what they believe could be discrimination, lack of consideration and inadequate treatment.

So now to our guests. Nancy, can you tell us some of the measures that you use at WHA to assess the safety of health providers? In other words, how do we measure safety?

[00:04:54] Nancy Guinto: Karen, thank you. A pleasure to be with you and Jessica today. And what I would share is the closest we come to measuring patient safety today is through a series of reports we call our “first, do no harm” reports. These reports actually calculate healthcare waste, think about that as overuse – we use the term waste and overuse interchangeably – and they look at common tests, procedures, and treatments that have been identified by physicians themselves, such as, through the Choosing Wisely program and the U.S. Preventive Services Task Force to be overused and potentially harmful.

When we think about this harm care and we think that exposing a patient to care that shouldn’t have happened in the first place, because it’s not evidence-based, means that a patient can be harmed physically, emotionally or financially… and I just thought we should, for the audience’s sake, consider an instance in which a woman has cervical cancer screenings too often. Suppose that in one of those screenings, she gets a false positive. Then she’s required to take more time off work away from our family to get a biopsy and additional consultations, more medical care on top of a screen that should not have happened in the first place. The emotional toll while she waits her final results is horrifying, she – and depending on the level of her health plan deductible and co-pays – she may be financially harmed through this experience as well.

And on a more global basis, sure, unnecessary care is adding to the unaffordability of healthcare. And that’s what my organization strives to do. Reporting on performance measurement and wasteful care at the medical group level and other hospital levels and other units of analysis in our state.

[00:06:40] Karen Wolk Feinstein: So Nancy while I have you, could you do an important task? Could you help explain what is value-based purchasing and how could our insurers use the measures you have to pay for safety?

[00:06:56] Nancy Guinto: Great question Karen and a real challenge to be concise about. So what I would say is, I think of value in healthcare as the combination of three elements, cost, quality, and patient experience. When we talk about this, we’re talking about high quality care at a fair price that includes an exceptional patient experience.

When an entity is participating in value-based purchasing, they’re agreeing to a set of health principles, important things to their patient population or employee or member population, and the measures that accompany those. And then they’re setting up mechanisms through contracts that reward the provider – and sometimes the provider and the payer are in a shared risk arrangement for care delivery. So, under a value-based purchasing arrangement, providers get paid for keeping people healthy, and it’s so constructed, for keeping an entire population healthy, such as an entire employee population healthy.

That’s the beauty of value-based purchasing, focusing on health and high quality care.

[00:08:08] Karen Wolk Feinstein: So this is really different, right? From the fee-for-service system, which means right now, the more services that a hospital provides or practice, the more money they make. So is it possible you would even make more money if you made more mistakes and kept people in a bed longer?

[00:08:29] Nancy Guinto: Yes, Karen, absolutely possible and you have it just right. The current fee-for-services system still pays for each element of care. And as a provider, the more I do surgeries, tests, treatments, visits, the more I get paid. And really the incentive is to deliver lots of units of care. I’m really not incented as a provider under that system for a patient’s overall health or that of the community. And I’m also not incented for coordinating care on a patient’s behalf.

[00:09:00] Karen Wolk Feinstein: Oh, Nancy, thank you. Pretty hard to give a quick overview. So, Jessica, just from your perspective, do you predict that both public, like Medicare and Medicaid, and private commercial insurers are considering value-based payment?

[00:09:21] Jessica Brooks: Well, yes, I know for sure, private insurers are considering value-based payment because as a leading employer coalition, we consider ourselves the insurer, the payer, or so – not the insurer but the payer – and this value is more than a conversation at the coalition level… I’ve been leading the coalition for seven and a half years, we’ve been talking about value and the definitions and trying to get it – get more clarity – and make sure that the voice of employers and what we believe is value is at the table, which includes: productivity, presenteeism, caregiver burden, quality of life, adjusted measures when we’re deciding whether to cover a drug or not.

From a government perspective, we seem to lag – Medicare and CMS – when it comes to adopting value-based strategies. Oftentimes we find that there are certain services covered under their Medicaid and Medicare plans or fully insured plans, and they are on commercial populations. And I do believe that’s due to the government’s focus on value in a different way in contracting and having that ability to contract on one major level, although employers cover more lives collectively than the government does, we don’t contract together. So it’s more difficult to get that done especially when you’re working with local health plans.

[00:10:46] Karen Wolk Feinstein: So, Jessica, I know something you’re passionate about is keeping people like me, patients, safe when they go for care. Talk to me from your perspective, I know it’s part of what you work on at Health Desk as well. How will value-based purchasing change the behavior of hospitals and health systems, even doctor’s practices?

[00:11:07] Jessica Brooks: Yeah, I think Nancy really highlighted in her formula, the patient experience, and that’s really ultimately what Health Desk was designed to account for is hearing an understanding of what value or quality means to a patient. And no one knows more than the patient when they’re not really being treated well. When they aren’t being heard or when their care is delayed, for example, and in the way of a patient experience or when they feel like their neck pain, isn’t being treated appropriately, that’s all included including patient experience. And we know that different patients sometimes based on race and other factors, maybe age sometimes, and other demographics, may influence how outcomes occur or how care is delivered.

So, in a value-based payment arrangement, we would be driving and paying for and incentivizing based on outcomes based on patient experience, which would definitely make a big difference than just sending someone for a test or providing a procedure. Bedside manner would count, having accounting for whether or not any errors or eliminating errors would count if we had more of an outcomes-based payment arrangement or at least, and, or accountability at the top through levels of compensation, but also culture that expects high quality safe care for every single patient. It will make a major difference.

[00:12:40] Karen Wolk Feinstein: I know going back to my Psych 101 course that people do respond to incentives. So as a patient, I would like to know that the person caring for me is being measured, that the care I’m getting and the outcomes of care are being measured, and that they’re getting rewarded when they’re excellent. So I hear what you say.

So Nancy, here’s a question. This all makes so much sense. Why is it taking so long to make it widespread? Right now payers, particularly our insurers, we know they have the data that tells them who’s naughty and nice. Who’s providing the safest care, the most reliably best practice care at a reasonable cost. So we know they have those data. What does it take? What’s it going to take for these data to become actionable?

[00:13:33] Nancy Guinto: Karen, I think we need to start with the consumers here. I think that it is pretty widespread that consumers of care are not as perhaps well-educated as you are or think in the same terms that you do when they visit a provider, they don’t understand there’s tremendous variation in care quality and costs. So I think that starts, first of all, with educating folks that the door you work through really matters and to have more and more inquiring the way you are about how does my provider stack up? I know when I go to my physician, I, for example, ask about the cost of care very directly.

They don’t often know, but I think if enough of us ask that it will become more the norm that this is just something that folks, our providers respond to us with. I agree with you that health insurers acknowledge they have these data. They know they have these data. What we hear in our market is that there are products that are available to allow purchasers to select a program that pays for value, but there’s simply not enough uptake by purchasers. They’re not willing to step up to the plate. They’re not willing to go at risk for potentially upsetting their employee population to make a change in benefits. And you know, my organization – and I know your deep commitment to this as well – is all about transparency and making information available.

The vast majority of the performance measurement work the Alliance does is publicly available. And I think that’s the first step, right? Making this information available, but data in and of itself will sit on a shelf unless you actively engage stakeholder groups to drive the work to action. And that’s really our focus. So what insights do we gain from the information? What do we recommend? How can we bring folks together around the table and drive the work to action in a way that improves health for citizens in our state?

[00:15:36] Karen Wolk Feinstein: I, and I know when I’m negotiating for health insurance, for our employees, I should know better, right? I should ask for data on safety quality. That should be part of the negotiation, but I admit often I’m just talking about price and, you know, can you keep the increase as low as possible and not asking about things that are really important to my employees? I’m guessing – and in fact I think I know – that very few health professionals get any instruction in their schools of health sciences in safety science, or human factors engineering, lean quality improvement methods, organizational behavior, systems theory, all the things you need to understand how to make systems safe.

How will health systems get their doctors and nurses and other personnel to change their behavior if they haven’t even been trained or exposed to how you can make systems much safer?

[00:16:36] Jessica Brooks: That’s a great question. I might be a millionaire after I answer this question, if I get it right. But I honestly believe that the patients and the purchaser, the employer purchaser, can play a really big role in transforming and turning this ship around. Dollars do count. They hold the insurer accountable and the insurer will work to ensure education and accountability on the provider level side as well. And I think patients if activated and have the literacy necessary, if we can educate patients, then they will be educating providers by asking the critical questions, by holding off on a surgery when they’re told that that’s what they need when that’s what they may not need. And they don’t rush to it and they don’t push to schedule it.

I do think the mass consolidation does make it a little bit more difficult when your providers are also owned by the hospital, that’s owned by the insurer or vice versa. And then you’re incentivized to keep feeding the system essentially. For example, your primary care refers you to their buddy who’s in the same system and orthopedics bills the insurance company that’s up a few floors from them. I do think there’s some level of clear complexity as a result of mass consolidation. However, I do think with the Consolidated Appropriations Act that’s holding insurers, brokers, other folks in the supply chain, more accountable to transparency, I think that’s going to help on the cost and pricing perspective. I do think initiatives like the RAND study that one of our sister coalitions in Indiana along with RAND have spearheaded for the last four years now, this is the fourth report that’s reporting hospital pricing by hospital.

That is something that we need, more and more purchasers, employer purchasers, to participate in and support and provide claims data to – to continue to get that level of transparency. But we have that now we didn’t have that three years ago, and now we have a level of insight of how to compare our populations in this marketplace versus Michigan or versus Colorado on what’s driving up costs. Those are tools that are now not only at the employer’s disposal, they’re now at the purchaser’s hands as well – I do think that’s going to happen. And then there’s a lot of innovators like surgical quality and different second opinion medical providers that are now being leveraged and purchased through employers and even some health plans to ensure that patients get to the highest quality providers and providers don’t want to lose that money.

So as more and more of these programs get adopted, they’re going to try to keep that market share and what’s going to keep that patient is quality and outcomes and that being reported. So, don’t underestimate the transparency in these vendors that are actually driving towards Centers of Excellence and employers, large employers like Walmart, as you know, are driving these program’s billing. I think this is all coming and shifting us in the right direction. It’s taking longer than we want, but regardless of training, they’re going to be held accountable to outcomes, so that training is going to have to come from leadership. And now that the consolidation is here, there can be one leader that says this is what has to happen in our system. So that is one benefit that should come out of the mass consolidation.

[00:20:01] Karen Wolk Feinstein: Let us hope, Jessica, because we know we can’t turn it back, there’s no way turning this back. You’ve set this up well for my next question to Nancy. Seattle has some very big national and global companies, some of whom are part of your Alliance – although if your weather keeps heating up some of them may want to come to Pennsylvania, where a drought is not even thought! So, you have some very big companies… have any of them experimented with value-based purchasing and how have these experiments gone? Are there any evaluations that might suggest that this new payment method would improve safety, outcomes of care, and even maybe lower the overall cost?

[00:20:45] Nancy Guinto: You’re right, Karen, we enjoy support from many wonderful purchasers in this state. And I’m going to share some high-level results from two of them. In our state, both the Washington State Health Care Authority and the Boeing company are real leaders in paying for value. The Health Care Authority, the Washington State Health Care Authority is the largest purchaser in our state and they buy coverage for Medicaid insured as well as public employees. Huge purchaser in our state. They’ve been working on value-based payment arrangements for many years and actually created something called a roadmap to value-based payment. In the most recent report they issued in 2019, they’re reporting that over 50% of their contracts are value-based. So that means they have embedded in their contracts metrics by which they are measuring patient quality, safety, et cetera. They aspire to have 90% of the contracts value-based by the end of this year. So that is a huge accomplishment.

The Boeing company – Jessica mentioned them as a real leader across our nation – has had accountable care organization contracts in place in the state of Washington for many years. And in these kinds of contracts, they’re contracting directly with providers bypassing health plans, and are very focused on the types of quality and safety metrics they include in their contracts as well. So I know that both of these large purchasers track patient satisfaction and experience, reporting very positive results. I’m not privy to cost savings back so I can’t comment on the overall cost of care, but knowing these two organizations, I think they’re pushing pretty hard on that element of value as well.

[00:22:26] Karen Wolk Feinstein: Well, I know Jessica mentioned Centers of Excellence, Employers Centers of Excellence, I love them. And from what I know about the centers that do exist – and there are more and more of them now as more health systems seek that designation for certain procedures – that people actually got much less care, fewer surgeries, less medication, less intensive diagnostics so you know that in some ways makes healthcare safer. So Jessica, tell us though the road to what some people call tier and steer, which you can define for us, is paved with good intentions, but it can be rocky with big potholes – we’re known for potholes here in Pittsburgh.

[00:23:13] Jessica Brooks: We sure are! Yes, so I have pretty much some very direct experience with tiering and steering in this marketplace. And there’s no secret that the whole country has transformed and we’ve had a lot of different changes in different markets. Some more fast paced than others, some more disruptive than others. But tiering and steering is one of those strategies that we really, many of our members here in Western PA, started to consider and were implementing and did implement, and around 2014 to 2015, when we had major, major disruption and concern around certain facilities when we had a big, big dispute between our largest insurer and our largest healthcare provider. And what we introduced was quality measures into the marketplace. We introduced independent third party vendors who provided quality insights that employers could make decisions based on objective information as to who they would steer their employees to. And they began to create plan designs that actually incentivize that.

So, zero out-of-pocket costs if you went to the hospital that had the highest quality scores within the marketplace. And then they were able to look at that from a variety of measures, such as, certain types of surgical outcomes, and any way that they were interested based on our utilization that they needed to slice. And then they would put those with the highest quality scores in the best tier and those employees would not have to pay anything out of pocket or very little out of pocket.

Well, we had a major, major arbitration and a binding of contracts that essentially for at least this 10 year period – I think we’re in year three of it – employers are no longer allowed to steer and tier, which makes it more difficult for them to be able to incentivize, based on the quality data that they’d have, people to go to the higher quality providers. So I think employers in a way have some level of accountability in this, we were drinking the Kool-Aid of just narrowing the network for costs, where there was a cost play for so long, which as you heard from Nancy, that’s not what value all encompasses, it’s not just cost. And in fact, one of the largest purchasers who provided those steering and tiering plan designs, was led by quality and they saved millions and millions of dollars based on that. So they didn’t lead by cost. They led by quality, which ultimately saved them a lot of money. But when we think about traditional narrow networks, it’s a cost play that we’re sold as purchasers and we bought into that.

And so, some of our purchasing behaviors have had to – we’ve had some bumps in the road, maybe hit some potholes – but now we understand that quality plays a significant role and that it shouldn’t be a lagging indicator in determining where we send our people for the best outcomes and that we pay for bad ones. So that’s some of my experience around steering and tiering and steering and tiering’s sake isn’t the answer. However, when leading with quality and informed data, it’s centered around the idea that we should be allowed to make those decisions to get people to the safest place as possible.

[00:26:23] Karen Wolk Feinstein: I sure wish I could do that with our employees with help if I have the data. So for both of you, you know, there’s that expression, every cloud has a silver lining, so I’m going to do an injustice and say every ray of sunshine may have unintended consequences that aren’t good, such as, perhaps skin cancer. So, there are a number of concerns about value-based purchasing. One, if we encourage hiring less expensive… it might lead us, it might lead some systems to say, well, I’ve got to work around this. So I’m going to hire less expensive workers, or I’m just going to invest in cheaper equipment, require everyone to have the same least expensive knee replacement device, or maybe cut corners on medications.

So, to keep us alert, to root out any bad practices and harm that could come from a well-intentioned new form of payment, what do you think about what we could do to prevent any abuse?

[00:27:23] Nancy Guinto: So I would just start Karen by picking up where Jessica was. She mentioned a purchaser who saved a lot of money by focusing on higher quality care. And I think it’s a commonly held notion that higher quality care is more expensive. And I think we start by dispelling that notion. Our data dispute that fact, I think that’s found in other forms as well. You know, it’s often that evidence-based care, the very best care for the patient, is the most efficient care. And I would just suggest that’s where we stay focused. What is the evidence telling us is the best way to care for this patient? And am I working with a system where they are offering that care in a very efficient, well-coordinated way? That is, you know, complete with high patient satisfaction and experience.

[00:28:17] Karen Wolk Feinstein: Jessica, do you want to add to that?

[00:28:19] Jessica Brooks: I don’t have, no, actually I don’t have much more to add to that. I think Nancy hit it on the head. That’s the formula.

[00:28:27] Karen Wolk Feinstein: Well, we may need to do some scrutiny, some oversight on the local level, as we have done by the way, with other managed care payment methods, just to make sure that well-intended payment methods aren’t in any way used as a way for the people who deliver care to not responsibly offer that care in the safest, highest quality way.

So my final question, you both have very interesting alliances of business groups, employers, and purchasers. So I’m going to ask you each for one thing, that one thing that you would say to employers and purchasers who are listening to our conversation now that they could do right now to help their employees get safer care.

[00:29:20] Jessica Brooks: So, I’m happy to start. One of the things that we’ve been focused on at the Pittsburgh Business Group on Health that I believe has been largely missing from all of the value conversations is equity. And oftentimes when we talk about even value… our strategies, our plan design, it’s still in a relatively homogeneous fashion as if we steered and tiered our plan design or create a different co-pay structure or included a different primary care program or diabetes program that all of our employees and their families that we cover are created equal. And there are significant disparities that exist in our healthcare delivery system.

People are treated differently. There’s evidence-based information, that’s not an argument. And we need to account for that in a way that we’ve never done before. So that’s one call to action that I think is a requirement of not only employers, but our healthcare delivery systems at the very top to account for their, for a lack of cultural competency, and the lack of intentionality around being even more deliberate around groups that have been unjustly treated in our health care delivery system. And that’s an area that we’re definitely focused on.

I believe half has to be a part of this quality conversation and value conversations. And I do think precision medicine will play a big role in helping that. Taking as much of the human factor out of it, where we can, as long as the digital age and our tools are designed with the right diversity and inclusiveness at the top, so that our systems, our AI, doesn’t automatically discriminate as well.

But I do think we have a really good opportunity with precision medicine, second opinion, medical contracting, putting contract language and our RFPs (Request for Proposals) that require quality measures and level of transparency, access to our own data so that we can make informed decisions and have a governance over some of the things that we’re providing access to. And so there’s a lot of actual, tangible things we can do looking at certain conditions and saying, oh, well, this demographic is more likely to get colon cancer. We should do different levels of access points to get treatment right there that we can go by disease state. We could go by a lot of different conditions, but it takes that, I believe to really, really create value for every single individual that we’re providing care to.

[00:31:49] Nancy Guinto: You just gave a number of really wonderful tactics and things to consider. I can’t top that. I think those are all great ways that employers and purchasers can get engaged. Maybe I would just go to the macro level for a minute to say, if you listen to this podcast, you’re interested in this issue and you have to do something about it. And you have to do something about it with other like-minded individuals so your voice is amplified. I’m really a believer that no one organization, regardless of its size, no matter how big you are, you can’t individually drive the market for safe and high value care. And the secret sauce, the magic sauce and all of this, I believe is collaboration amongst like-minded individuals to do something that makes a difference.

[00:32:41] Karen Wolk Feinstein: Well, I can’t thank you both. It brightens my day – we’re having thunderstorms here – to be talking to two people who are so dedicated to making healthcare safer and higher quality. This many of you know this is part of a series of podcasts talking about why it could be valuable to have a National Patient Safety Board with autonomous, easy to use ways to prevent errors before they happen. So if you’re a health system, if you deliver health care in any way at the practice level, the skilled nursing facility level or at the hospital level… what an NPSB could do, just like the National Transportation Safety Board, is come up with solutions that make the work simpler on your frontline employees, because a lot of safety issues are identified before they happen, the preconditions of harm are identified using our best analytics and that using our best technologies, corrective actions are put in play before the harm ever occurs. Now, this does happen at almost every other high-risk complex industry so we know it’s doable. But we think the key is, you know, the employers really do want their healthcare delivery systems to offer safer care and I think they’re willing to identify it and pay for.

So I thank you both. Anyone who is interested, we do have a coalition that is formed of all the key stakeholders that’s working on this at the congressional level to get approval for a National Patient Safety Board. We have a website, npsb.org, that you can access to hear the first two podcasts, one looked at why did we choose the National Transportation Safety Board as a model? The second looks at the promise of big data and predictive analytics, and technology to make healthcare safer, take the burden off the front line and make this simple for health systems to be as safe as those who use their services want them to be. So thank you, Nancy. Thank you, Jessica. This was a very engaging conversation.

Subscribe on your favorite podcast app: Apple Podcasts | Google Podcasts | Spotify | Anchor | Pocket Casts