Quality Review and Accountability PDF

# SECTION 2 ## Quality Review and Accountability Deborah J. Bulger ## SECTION CONTENTS - Introduction - The Accountability Imperative - Making the Business Case for Quality - Quality and Payment Models - Quality as Policy - Quality as a Profession - Quality as a Center of Exc...

# SECTION 2 ## Quality Review and Accountability Deborah J. Bulger ## SECTION CONTENTS - Introduction - The Accountability Imperative - Making the Business Case for Quality - Quality and Payment Models - Quality as Policy - Quality as a Profession - Quality as a Center of Excellence - Quality as an Operational Mandate - Quality as an Organizing Structure - Current and Emerging Payment Models - Trends in Payment Reform - Government Payers - Commercial Markets - Costs of Care - Access to Care - Social Determinants of Health - Alternative Payment Models - Transition to New Payment Models - Forums on Healthcare Payment Reform - Transparency and Quality Improvement - Performance Measurement - Hospital Performance - Physician and Clinician Performance - Medical Peer Review - Public Reporting - Incentives and Penalties - Customer Demands - Value-Based Service Delivery - Quality Measurement Programs - CMS Quality Measures - Hospital Readmissions Reduction Program - Hospital-Acquired Condition Reduction Program - Quality Payment Program - Accountable Care Organizations - Clinical Quality Registries - Qualified Clinical Data Registry - Agency for Healthcare Research and Quality - Healthcare Effectiveness Data & Information Set - Hospital Consumer Assessment of Healthcare Providers and Systems - CAHPS Clinician & Group Survey - Performance Measurement and Improvement - Information Technology - Business Intelligence - Clinical Informatics - EHR Vendor - Education - Marketing - Data Management and Reporting - Administrative Data - Claims - Electronic Health Record - Patient Surveys - Patient-Reported Outcomes - Meaningful Measures - Quality and Accountability - Organizational Structure - Interoperability - Analytics Capabilities - Vendor Support - Decision Making - Continuous Learning - Sharing Performance Results - Know the Audience - Build a Common Vocabulary - Reframe Positive Outcomes - Storytelling - Analysis - Presenting Best Practices - Visualizing Data - Relevance - Trust - Enhancing Equity Through Analysis, Relevance, and Trust - Summary - References - Suggested Readings - Online Resources ## Introduction With an increased focus on transparency of and accountability for healthcare quality, outcomes, cost, and value, it is essential that the healthcare quality professional understands how current and emerging payment models impact quality improvement processes, outcomes measurement, cost, and reimbursement. The healthcare quality professional must guide their leadership team toward improved clinical and financial outcomes by implementing best practices to support compliance with regulations, standards, and policies for measure reporting that advance quality improvement. This section describes strategies and tactics to ensure data reliability, effective utilization of reporting and analytics tools, compliance with external reporting requirements, and the evaluation of technology required to support the quality, safety, and performance improvement program. Information is provided on performance review activities according to internal and external applicable regulations, standards, and policies, assembling informational resources, protecting confidentiality, and providing timely unbiased feedback to practitioners. A discussion of methods to drive multidisciplinary stakeholder collaboration across the continuum equips the healthcare quality professional with knowledge needed to become a key influencer in the quality improvement strategy. ### The Accountability Imperative System complexity is inherent in healthcare. It is a dynamic network of interactions across diverse stakeholders who have a keen and perhaps self-centered interest in the outcome of those interactions. Patients seek illness prevention, maintenance of health, or recovery from illness; providers desire to use the best possible science to deliver evidence-based care; and payers and regulators strive to balance economic responsibility, all while adapting to social, scientific, and environmental changes beyond their control. The principles of value-based care (i.e., shared risk, improved public health, lowered cost), have prompted the industry to take greater accountability for those multistakeholder costs and outcomes with a demand for increased transparency and compliance with local, state, and national initiatives. In 2019, healthcare spending in the United States reached $3.8 trillion, up 4.6% in 2018, accounting for 17% of its gross domestic product. Healthcare spending per person was $10,966, 42% higher than Switzerland, the next highest country. Payment by private insurance, by Medicare and Medicaid, and out of pocket account for roughly 80% of the healthcare spending in the United States with Medicare spending growing at a rate of nearly 7% representing over $799 billion in 2019. Of concern to consumers, out-of-pocket spending grew 4.6% in 2019, which was faster than the 3.8% growth in 2018. **Figure 2.1** shows a distribution of healthcare expenditures. Quality review and accountability combines the science of data acquisition, data integrity, analysis, modeling, and benchmarking with the art of communication, collaboration, partnership, and behavior change to increase transparency and drive improvement. (See **Box 2.1**.) The healthcare quality professional plays an increasingly central role in the transformation of health systems to business models designed to reward cost-efficient, quality care that improves patient outcomes. ### Making the Business Case for Quality Healthcare has roots in a cottage industry where the craft of medicine was practiced at a local level. The cost of healthcare measured in human lives lost or harmed, and the waste that will exacerbate our country's challenges to balance macroeconomic priorities, is too much to manage. Today, healthcare is big business, accounting for 17% of the nation's gross domestic product. Ensuring healthcare quality has high stakes for patients and the U.S. economy. In 2020, medical errors were the third leading cause of death in the United States. Healthcare waste, defined as failure of care delivery, failure of care coordination, overtreatment, or low-value care was cited between $760 and $935 billion annually in the United States. While these statistics seem staggering, there are great strides to be made when each healthcare stakeholder-patient, provider, and payer-recognizes the contribution to managing the cost and quality of care that can be made on a local and personal level. Making the business case for quality starts with a grassroots effort to drive the adoption of value-based care initiatives within the organization’s span of control, identify productivity and efficiency gains that lead to cost reduction without compromising patient care, create a culture of safety and quality that transcends external influences like coronavirus disease 2019 (COVID-19), and reintroduce joy in the workplace. The growth of value-based reimbursement necessitates a more collaborative relationship between providers and payers of healthcare. More than ever, as accountability shifts and the potential for financial risk increases, payers and providers need to create a partnership with a common goal of identifying gaps in care, reducing cost, and promoting reliability and effectiveness while managing their respective operations, margins, and revenue. Payers and providers may renegotiate contracts on an annual basis or add or modify contract terms when market dynamics demand it. The outcome of those negotiations-specifically those related to quality have an impact on all stakeholders. As a provider, when entering a new value-based payment contract, some key practices should be considered. **Box 2.1** **Key Points: The Accountability Imperative** - The exponential growth of healthcare expenditures creates an unsustainable economic future unless significant changes are made in how healthcare value is delivered. - The principles of value-based care place shared risk for all stakeholders, prompting the industry to promote greater accountability for lowering costs, improving population health, and improving patient experience. - Public reporting is the foundation for transparency that holds stakeholders accountable through the publication of quality measure results of physicians, hospitals and health systems, and payers. - Both government and private payers adopted a range of pay-for-performance strategies designed to optimize performance and align clinical outcomes with financial incentives. - The healthcare quality professional plays an increasingly central role in the transformation from volume to value. ## Quality and Payment Models Under value-based care agreements, providers are incented to deliver an evidence-based care model that focuses on health and wellness, minimizes the effects of chronic disease, and mitigates gaps in care. Payment is based on performance derived from a combination of measures of efficiency and effectiveness. Performance-based payment models have reshaped the healthcare landscape from 2012 to 2022. In 2019, more than a third of the U.S. healthcare payments were the result of a form of value-based payment, up from 23% in 2015. This relationship of cost and reimbursement to quality has redefined the role of healthcare quality measurement and management and has influenced the perception of quality in every aspect of the healthcare ecosystem. ### Quality as Policy The COVID-19 pandemic exposed many problems in the U.S. healthcare system, including barriers to access, increased incidence of hospital-acquired infections, 14 and healthcare disparity and inequity. Current fee-for-service payment models pay only for specific clinical services as they are coded and billed, yet social determinants of health (SDOH), not represented in the billing process, may account for up to 80% of patient outcomes, 23 and by default, cost. An emphasis on SDOH helps to mitigate barriers to accessing preventive care in marginalized populations. For example, many screening rates, like those for cancer, are below desired levels and reflect disparities across ethnicity/race. 24 Patients benefit from outreach from providers, health plan case managers, navigators, and wellness programs provided by employers. Policy makers are becoming increasingly aware of the need to care for the whole patient, and Medicaid programs have increased their focus by paying for health outcomes rather than volume of services. The increased focus on strategies to address social needs led 24 states to require that Medicaid managed care organizations screen beneficiaries for unmet social needs and help the patient address those needs. 25 States are prohibited from using Medicaid to directly fund nonmedical expenses, but in some cases they use case management services to enroll patients in community-based programs such as the Supplemental Nutrition Assistance Program or housing vouchers. ### Quality as a Profession Prior to 1983, when CMS introduced the Medicare Inpatient Prospective Payment System, hospitals were paid for each unit of service. 26 Under the Inpatient Prospective Payment System, patients were grouped into diagnosis-related groups (DRGs) as a means of stratifying patients with similar diagnoses and setting payment for those DRGs, and the more accurate and specific the patient record, the greater the potential payment. 27 This first wave of payment reform elevated the medical record itself to a source of revenue and transitioned the role of medical records "librarians" as curators of the patient charts to health information management professionals whose skill can mean the difference in profit and loss. Much like the DRG shift in the 1980s, this era of value-based reimbursement means that quality is on the critical path to profitability, and as a result, raises the visibility, responsibility, and accountability of the healthcare quality professional. The quality profession evolved from its roots in quality assurance (i.e., monitoring and reporting of measures) to a profession that is now driving quality, safety, value, and innovation in healthcare as an equal partner on the healthcare leadership. 28 Quality is no longer an afterthought but a valued advisor in the management of the organization. Chief quality officers participate in payer contract negotiations and advise on quality, safety, and performance improvement opportunities. The certification of healthcare quality professionals driven by the NAHQ Healthcare Quality Competency Framework creates awareness of the skills required to effectively lead the quality improvement and reduce the variability of quality competencies. 29 ### Quality as a Center of Excellence Quality is not a program or a project. It is not the sole responsibility of a single individual or the quality department. 30 The principles of quality should be hardwired into every aspect of healthcare delivery with a shared desire by stakeholders at every level to achieve meaningful, sustainable improvement with the healthcare quality professional as the guide and trusted advisor. Healthcare organizations have been plagued by information silos for many years. Value-based payment models forced the dissolution of those silos across the healthcare system, empowering patients, providers, suppliers, and payers to embrace quality improvement as a center of excellence. Bringing multiple disciplines together with different skills, knowledge, attitudes, and responsibility around a common mission creates transparency and enables stakeholders to align around organizational business outcomes rather than departmental outcomes. ### Quality as an Operational Mandate As the population ages and chronic conditions increase, so does healthcare spending. The need to provide value requires the shared clinical and financial accountability of providers and payers alike (i.e., improve health and wellness, address gaps in care, manage chronic disease, and lower spending). The introduction of alternative payment models (APMs) such as Medicare Advantage programs require provider-sponsored health plans to take responsibility for a specific subset of Medicare patients. Health plans and providers are measured on quality of care in multiple domains like care coordination, experience, and preventive health to better understand and manage disease risk. When providers and payers share financial risk for the well-being of their constituents, patients benefit from a coordinated approach to care. Patients who have a better experience navigating the healthcare system are more prone to receive preventive services like vaccines and colonoscopies. Early detection of risk factors helps address disease progression, and chronic diseases like hypertension and diabetes are more likely to be controlled, resulting in fewer emergency department and hospital visits. 31 ### Quality as an Organizing Structure As healthcare delivery has historically been fragmented, making it difficult to control costs and accountability, creating disruptions in the continuity of care and surprise billing for out-of-network care, the evolution of payment models may necessitate a redesign of many organizational processes to accommodate greater care coordination. A key goal of value-based healthcare models is to improve coordination of care, reimbursing the provider for overall value rather than volume and utilization. A study using data from the AHRQ Comparative Health System Performance Initiative 32 suggests that organizational structures, composition, and other characteristics influence cost and quality performance. 33 As organizations strive to improve performance through better business alignment and assume more clinical and financial risk, it is important to understand the structure under which the organization operates. For example, multihospital systems can create economies of scale and expand their delivery network, improving access to care while potentially retaining board autonomy at the hospital level. Conversely, clinically integrated networks share a high degree of risk and rely on interdependence among network physicians to ensure cost management and quality. The clinically integrated network must share processes such as clinical protocols and information technology. **Table 2.1** provides the research findings from five integrated organizations. For more information see Suggested Readings. While providers continue to be paid as a fee for service for a portion of their payment, under value-based care, they are paid a bonus for achieving cost efficiency and quality targets or incur a penalty if those performance thresholds are not met. Incentives and penalties will vary based on the level of risk accepted by the provider. In this context, quality metrics are instrumental in developing the payment structure. However, the correlation between quality metrics and payment models is complex and evolving, and depending on the type of payment model, the contribution of the quality measures to the reimbursement model will vary. It is important for the healthcare quality professional to understand the impact of the quality measures on reimbursement and develop a plan for acquiring the data, structuring the measures, establishing a cadence of reporting, and instilling a sense of urgency around performance improvement. Depending on the contract, the impact of quality metrics on reimbursement rules can take many forms, and it is important to dissect those rules to assess the impact. In some cases, a bonus is paid when a threshold is met, or a penalty is incurred if not. In other models, the provider must demonstrate improvement; for example, a percentage of improvement over baseline correlates to increased reimbursement. Comparative-based measures pay bonuses for top performance in a group of eligible providers and penalties for worst performance. Regardless of the method of incentive, the rules of engagement must be understood by the healthcare quality professional to advise the organization on the best approach. **Table 2.1** **Key Features of the Horizontally and Vertically Integrated Structures** | Organization Type| Included Healthcare Providers and Services | Care Management Functions | Administrative Oversight of Providers | |---|---|---|---| | Multispecialty group practice | Physicians of various specialties Varied services depending on included specialties| May facilitate patient referral, improve care coordination, and be better positioned to manage the costs of care | Multispecialty group practices share governance and infrastructure, which can result in tighter management control; however, control can vary depending on factors such as size and whether the practice is physician owned, owns a hospital, or is owned by the hospital/system. | | Multihospital systems | Two or more hospitals Primarily hospital services, which may include inpatient and ambulatory services | Varies depending on included service; if vertically integrated, may have care functions that are more analogous to integrated delivery systems | As multihospital systems are characterized by shared ownership or management, administration may have more direct control over included hospitals, including care processes, shared organizational missions, and the like. However, they may also maintain separate hospital boards and executives, despite shared asset ownership. | | Integrated delivery system | Varies; may include hospitals, physicians, and other healthcare providers such as postacute care providers, behavioral health, community-based organizations, as well as health plans Comprehensive, full continuum of care| Care coordination and information sharing along the care continuum Population health and care management Data collection, analysis, and reporting capabilities to inform quality improvement Health information technology capacity Use of evidence-based practices Interdisciplinary, team-based care| Providers join systems through ownership or formalized contractual agreements, which typically establish some degree of administrative control. Administrative control may vary depending on the extent to which the system centralizes management activities, engages in physician-system integration, and employs physicians. | | Clinically integrated network | Primarily includes physicians but may also include hospitals and other providers such as postacute care providers Varying services depending on network composition | Demonstration of integration clinically through several activities, including a program to evaluate and modify practice patterns and creation of a high degree of interdependence and cooperation among network physicians to control costs and ensure quality Example features of programs include the following: Implementing systems to ensure appropriate utilization of services Deploying evidence-based practice standards and protocols Performance evaluation and feedback to included providers Case management and care coordination | Providers are either integrated via ownership or contractual relationships; the clinical integration framework requires physicians to use consistent care protocols and to monitor quality, suggesting greater oversight and management of included providers. | | Physician hospital organization | Hospitals and their affiliated physicians Hospitals and physician services, which vary depending on included specialties | Organizations facilitate managed care contracting, provide administrative services to physicians, facilitate natural referral relationships around one hospital, and manage ambulatory care facilities where physicians work. Closed physician-hospital organizations selectively contract with physicians based on quality and cost performance and have exclusive relationships with physicians and close relationships with hospitals, which may facilitate care coordination Organizations may provide processes and resources to support care management. | Physicians maintain independent ownership and management of practices, while practices contract with health plans through the organization. | (continues) ## Quality as Policy The COVID-19 pandemic exposed many problems in the U.S. healthcare system, including barriers to access, increased incidence of hospital-acquired infections, 14 and healthcare disparity and inequity. 22 Current fee-for-service payment models pay only for specific clinical services as they are coded and billed, yet social determinants of health (SDOH), not represented in the billing process, may account for up to 80% of patient outcomes, 23 and by default, cost. An emphasis on SDOH helps to mitigate barriers to accessing preventive care in marginalized populations. For example, many screening rates, like those for cancer, are below desired levels and reflect disparities across ethnicity/race. 24 Patients benefit from outreach from providers, health plan case managers, navigators, and wellness programs provided by employers. Policy makers are becoming increasingly aware of the need to care for the whole patient, and Medicaid programs have increased their focus by paying for health outcomes rather than volume of services. The increased focus on strategies to address social needs led 24 states to require that Medicaid managed care organizations screen beneficiaries for unmet social needs and help the patient address those needs. 25 States are prohibited from using Medicaid to directly fund nonmedical expenses, but in some cases they use case management services to enroll patients in community-based programs such as the Supplemental Nutrition Assistance Program or housing vouchers. ### Quality as a Profession Prior to 1983, when CMS introduced the Medicare Inpatient Prospective Payment System, hospitals were paid for each unit of service. 26 Under the Inpatient Prospective Payment System, patients were grouped into diagnosis-related groups (DRGs) as a means of stratifying patients with similar diagnoses and setting payment for those DRGs, and the more accurate and specific the patient record, the greater the potential payment. 27 This first wave of payment reform elevated the medical record itself to a source of revenue and transitioned the role of medical records "librarians" as curators of the patient charts to health information management professionals whose skill can mean the difference in profit and loss. Much like the DRG shift in the 1980s, this era of value-based reimbursement means that quality is on the critical path to profitability, and as a result, raises the visibility, responsibility, and accountability of the healthcare quality professional. The quality profession evolved from its roots in quality assurance (i.e., monitoring and reporting of measures) to a profession that is now driving quality, safety, value, and innovation in healthcare as an equal partner on the healthcare leadership. 28 Quality is no longer an afterthought but a valued advisor in the management of the organization. Chief quality officers participate in payer contract negotiations and advise on quality, safety, and performance improvement opportunities. The certification of healthcare quality professionals driven by the NAHQ Healthcare Quality Competency Framework creates awareness of the skills required to effectively lead the quality improvement and reduce the variability of quality competencies. 29 ### Quality as a Center of Excellence Quality is not a program or a project. It is not the sole responsibility of a single individual or the quality department. 30 The principles of quality should be hardwired into every aspect of healthcare delivery with a shared desire by stakeholders at every level to achieve meaningful, sustainable improvement with the healthcare quality professional as the guide and trusted advisor. Healthcare organizations have been plagued by information silos for many years. Value-based payment models forced the dissolution of those silos across the healthcare system, empowering patients, providers, suppliers, and payers to embrace quality improvement as a center of excellence. Bringing multiple disciplines together with different skills, knowledge, attitudes, and responsibility around a common mission creates transparency and enables stakeholders to align around organizational business outcomes rather than departmental outcomes. ### Quality as an Operational Mandate As the population ages and chronic conditions increase, so does healthcare spending. The need to provide value requires the shared clinical and financial accountability of providers and payers alike (i.e., improve health and wellness, address gaps in care, manage chronic disease, and lower spending). The introduction of alternative payment models (APMs) such as Medicare Advantage programs require provider-sponsored health plans to take responsibility for a specific subset of Medicare patients. Health plans and providers are measured on quality of care in multiple domains like care coordination, experience, and preventive health to better understand and manage disease risk. When providers and payers share financial risk for the well-being of their constituents, patients benefit from a coordinated approach to care. Patients who have a better experience navigating the healthcare system are more prone to receive preventive services like vaccines and colonoscopies. Early detection of risk factors helps address disease progression, and chronic diseases like hypertension and diabetes are more likely to be controlled, resulting in fewer emergency department and hospital visits. 31 ### Quality as an Organizing Structure As healthcare delivery has historically been fragmented, making it difficult to control costs and accountability, creating disruptions in the continuity of care and surprise billing for out-of-network care, the evolution of payment models may necessitate a redesign of many organizational processes to accommodate greater care coordination. A key goal of value-based healthcare models is to improve coordination of care, reimbursing the provider for overall value rather than volume and utilization. A study using data from the AHRQ Comparative Health System Performance Initiative 32 suggests that organizational structures, composition, and other characteristics influence cost and quality performance. 33 As organizations strive to improve performance through better business alignment and assume more clinical and financial risk, it is important to understand the structure under which the organization operates. For example, multihospital systems can create economies of scale and expand their delivery network, improving access to care while potentially retaining board autonomy at the hospital level. Conversely, clinically integrated networks share a high degree of risk and rely on interdependence among network physicians to ensure cost management and quality. The clinically integrated network must share processes such as clinical protocols and information technology. **Table 2.1** provides the research findings from five integrated organizations. For more information see Suggested Readings. While providers continue to be paid as a fee for service for a portion of their payment, under value-based care, they are paid a bonus for achieving cost efficiency and quality targets or incur a penalty if those performance thresholds are not met. Incentives and penalties will vary based on the level of risk accepted by the provider. In this context, quality metrics are instrumental in developing the payment structure. However, the correlation between quality metrics and payment models is complex and evolving, and depending on the type of payment model, the contribution of the quality measures to the reimbursement model will vary. It is important for the healthcare quality professional to understand the impact of the quality measures on reimbursement and develop a plan for acquiring the data, structuring the measures, establishing a cadence of reporting, and instilling a sense of urgency around performance improvement. Depending on the contract, the impact of quality metrics on reimbursement rules can take many forms, and it is important to dissect those rules to assess the impact. In some cases, a bonus is paid when a threshold is met, or a penalty is incurred if not. In other models, the provider must demonstrate improvement; for example, a percentage of improvement over baseline correlates to increased reimbursement. Comparative-based measures pay bonuses for top performance in a group of eligible providers and penalties for worst performance. Regardless of the method of incentive, the rules of engagement must be understood by the healthcare quality professional to advise the organization on the best approach. **Table 2.1** **Key Features of the Horizontally and Vertically Integrated Structures** | Organization Type| Included Healthcare Providers and Services | Care Management Functions | Administrative Oversight of Providers | |---|---|---|---| | Multispecialty group practice | Physicians of various specialties Varied services depending on included specialties| May facilitate patient referral, improve care coordination, and be better positioned to manage the costs of care | Multispecialty group practices share governance and infrastructure, which can result in tighter management control; however, control can vary depending on factors such as size and whether the practice is physician owned, owns a hospital, or is owned by the hospital/system. | | Multihospital systems | Two or more hospitals Primarily hospital services, which may include inpatient and ambulatory services | Varies depending on included service; if vertically integrated, may have care functions that are more analogous to integrated delivery systems | As multihospital systems are characterized by shared ownership or management, administration may have more direct control over included hospitals, including care processes, shared organizational missions, and the like. However, they may also maintain separate hospital boards and executives, despite shared asset ownership. | | Integrated delivery system | Varies; may include hospitals, physicians, and other healthcare providers such as postacute care providers, behavioral health, community-based organizations, as well as health plans Comprehensive, full continuum of care| Care coordination and information sharing along the care continuum Population health and care management Data collection, analysis, and reporting capabilities to inform quality improvement Health information technology capacity Use of evidence-based practices Interdisciplinary, team-based care| Providers join systems through ownership or formalized contractual agreements, which typically establish some degree of administrative control. Administrative control may vary depending on the extent to which the system centralizes management activities, engages in physician-system integration, and employs physicians. | | Clinically integrated network | Primarily includes physicians but may also include hospitals and other providers such as postacute care providers Varying services depending on network composition | Demonstration of integration clinically through several activities, including a program to evaluate and modify practice patterns and creation of a high degree of interdependence and cooperation among network physicians to control costs and ensure quality Example features of programs include the following: Implementing systems to ensure appropriate utilization of services Deploying evidence-based practice standards and protocols Performance evaluation and feedback to included providers Case management and care coordination | Providers are either integrated via ownership or contractual relationships; the clinical integration framework requires physicians to use consistent care protocols and to monitor quality, suggesting greater oversight and management of included providers. | | Physician hospital organization | Hospitals and their affiliated physicians Hospitals and physician services, which vary depending on included specialties | Organizations facilitate managed care contracting, provide administrative services to physicians, facilitate natural referral relationships around one hospital, and manage ambulatory care facilities where physicians work. Closed physician-hospital organizations selectively contract with physicians based on quality and cost performance and have exclusive relationships with physicians and close relationships with hospitals, which may facilitate care coordination Organizations may provide processes and resources to support care management. | Physicians maintain independent ownership and management of practices, while practices contract with health plans through the organization. | (continues) ## Quality as Policy The COVID-19 pandemic exposed many problems in the U.S. healthcare system, including barriers to access, increased incidence of hospital-acquired infections, 14 and healthcare disparity and inequity. 22 Current fee-for-service payment models pay only for specific clinical services as they are coded and billed, yet social determinants of health (SDOH), not represented in the billing process, may account for up to 80% of patient outcomes, 23 and by default, cost. An emphasis on SDOH helps to mitigate barriers to accessing preventive care in marginalized populations. For example, many screening rates, like those for cancer, are below desired levels and reflect disparities across ethnicity/race. 24 Patients benefit from outreach from providers, health plan case managers, navigators, and wellness programs provided by employers. Policy makers are becoming increasingly aware of the need to care for the whole patient, and Medicaid programs have increased their focus by paying for health outcomes rather than volume of services. The increased focus on strategies to address social needs led 24 states to require that Medicaid managed care organizations screen beneficiaries for unmet social needs and help the patient address those needs. 25 States are prohibited from using Medicaid to directly fund nonmedical expenses, but in some cases they use case management services to enroll patients in community-based programs such as the Supplemental Nutrition Assistance Program or housing vouchers. ### Quality as a Profession Prior to 1983, when CMS introduced the Medicare Inpatient Prospective Payment System, hospitals were paid for each unit of service. 26 Under the Inpatient Prospective Payment System, patients were grouped into diagnosis-related groups (DRGs) as a means of stratifying patients with similar diagnoses and setting payment for those DRGs, and the more accurate and specific the patient record, the greater the potential payment. 27 This first wave of payment reform elevated the medical record itself to a source of revenue and transitioned the role of medical records "librarians" as curators of the patient charts to health information management professionals whose skill can mean the difference in profit and loss. Much like the DRG shift in the 1980s, this era of value-based reimbursement means that quality is on the critical path to profitability, and as a result, raises the visibility, responsibility, and accountability of the healthcare quality professional. The quality profession evolved from its roots in quality assurance (i.e., monitoring and reporting of measures) to a profession that is now driving quality, safety, value, and innovation in healthcare as an equal partner on the healthcare leadership. 28 Quality is no longer an afterthought but a valued advisor in the management of the organization. Chief quality officers participate in payer contract negotiations and advise on quality, safety, and performance improvement opportunities. The certification of healthcare quality professionals driven by the NAHQ Healthcare Quality Competency Framework creates awareness of the skills required to effectively lead the quality improvement and reduce the variability of quality competencies. 29 ### Quality as a Center of Excellence Quality is not a program or a project. It is not the sole responsibility of a single individual or the quality department. 30 The principles of quality should be hardwired into every aspect of healthcare delivery with a shared desire by stakeholders at every level to achieve meaningful, sustainable improvement with the healthcare quality professional as the guide and trusted advisor. Healthcare organizations have been plagued by information silos for many years. Value-based payment models forced the dissolution of those silos across the healthcare system, empowering patients, providers, suppliers, and payers to embrace quality improvement as a center of excellence. Bringing multiple disciplines together with different skills, knowledge, attitudes, and responsibility around a common mission creates transparency and enables stakeholders to align around organizational business outcomes rather than departmental outcomes. ### Quality as an Operational Mandate As the population ages and chronic conditions increase, so does healthcare spending. The need to provide value requires the shared clinical and financial accountability of providers and payers alike (i.e., improve health and wellness, address gaps in care, manage chronic disease, and lower spending). The introduction of alternative payment models (APMs) such as Medicare Advantage programs require provider-sponsored health plans to take responsibility for a specific subset of Medicare patients. Health plans and providers are measured on quality of care in multiple domains like care coordination, experience, and preventive health to better understand and manage disease risk. When providers and payers share financial risk for the well-being of their constituents, patients benefit from a coordinated approach to care. Patients who have a better experience navigating the healthcare system are more prone to receive preventive services like vaccines and colonoscopies. Early detection of risk factors helps address disease progression, and chronic diseases like hypertension and diabetes are more likely to be controlled, resulting in fewer emergency department and hospital visits. 31 ### Quality as an Organizing Structure As healthcare delivery has historically been fragmented, making it difficult to control costs and accountability, creating disruptions in the continuity of care and surprise billing for out-of-network care, the evolution of payment models may necessitate a redesign of many organizational processes to accommodate greater care coordination. A key goal of value-based healthcare models is to improve coordination of care, reimbursing the provider for overall value rather than volume and utilization. A study using data from the AHRQ Comparative Health System Performance Initiative 32 suggests that organizational structures, composition, and other characteristics influence cost and quality performance. 33 As organizations strive to improve performance through better business alignment and assume more clinical and financial risk, it is important to understand the structure under which the organization operates. For example, multihospital systems can create economies of scale and expand their delivery network, improving access to care while potentially retaining board autonomy at the hospital level. Conversely, clinically integrated networks share a high degree of risk and rely on interdependence among network physicians to ensure cost management and quality. The clinically integrated network must share processes such as clinical protocols and information technology. **Table 2.1** provides the research findings from five integrated organizations. For more information see Suggested Readings. While providers continue to be paid as a fee for service for a portion of their payment, under value-based care, they are paid a bonus for achieving cost efficiency and quality targets or incur a penalty if those performance thresholds are not met. Incentives and penalties will vary based on the level of risk accepted by the provider. In this context, quality metrics are instrumental in developing the payment structure. However, the correlation between quality metrics and payment models is complex and evolving, and depending on the type of payment model, the contribution of the quality measures to the reimbursement model will vary. It is important for the healthcare quality professional to understand the impact of the quality measures on reimbursement and develop a plan for acquiring the data, structuring the measures, establishing a cadence of reporting, and instilling a sense of urgency around performance improvement. Depending on the contract, the impact of quality metrics on reimbursement rules can take many forms, and it is important to dissect those rules to assess the impact. In some cases, a bonus is paid when a threshold is met, or a penalty is incurred if not. In other models, the provider must demonstrate improvement; for example, a percentage of improvement over baseline correlates to increased reimbursement. Comparative-based measures pay bonuses for top performance in a group of eligible providers and penalties for worst performance. Regardless of the method of incentive, the rules of engagement must be understood by the healthcare quality professional to advise the organization on the best approach. **Table 2.1** **Key Features of the Horizontally and Vertically Integrated Structures** | Organization Type| Included Healthcare Providers and Services | Care Management Functions | Administrative Oversight of Providers | |---|---|---|---| | Multispecialty group practice | Physicians of various specialties Varied services depending on included specialties| May facilitate patient referral, improve care coordination, and be better positioned to manage the costs of care | Multispecialty group practices share governance and infrastructure, which can result in tighter management control; however, control can vary depending on factors such as size and whether the practice is physician owned, owns a hospital, or is owned by the hospital/system. | | Multihospital systems | Two or more hospitals Primarily hospital services, which may include inpatient and ambulatory services | Varies depending on included service; if vertically integrated, may have care functions that are more analogous to integrated delivery systems | As multihospital systems are characterized by shared ownership or management, administration may have more direct control over included hospitals, including care processes, shared organizational missions, and the like. However, they may also maintain separate hospital boards and executives, despite shared asset ownership. | | Integrated delivery system | Varies; may include hospitals, physicians, and other healthcare providers such as postacute care providers, behavioral health, community-based organizations, as well as health plans Comprehensive, full continuum of care| Care coordination and information sharing along the care continuum Population health and care management Data collection, analysis, and reporting capabilities to inform quality improvement Health information technology capacity Use of evidence-based practices Interdisciplinary, team-based care| Providers join systems through ownership or formalized contractual agreements, which typically establish some degree of administrative control. Administrative control may vary depending on the extent to which the system centralizes management activities, engages in physician-system integration, and employs physicians. | | Clinically integrated network | Primarily includes physicians but may also include hospitals and other providers such as postacute care providers Varying services depending on network composition | Demonstration of integration clinically through several activities, including a program to evaluate and modify practice patterns and creation of a high degree of interdependence and cooperation among network physicians to control costs and ensure quality Example features of programs include the following: Implementing systems to ensure appropriate utilization of services Deploying evidence-based practice standards and protocols Performance evaluation and feedback to