Mistakes, fragmentation drive healthcare costs

The National Quality Forum (NQF) Board of Directors has approved for endorsement four measures on healthcare resource use and costs. The measures - focusing on diabetes and cardiovascular care costs as well as total primary-care costs - will provide data on how resources are used in these areas of care. The goal is to help create a more efficient, less wasteful healthcare system.

“This is our first major project to endorse resource use measures,” says Janet Corrigan, president and CEO of NQF, which is a voluntary consensus standards-setting organization. “We really view this as important for the longer term objective to get the most value for healthcare dollars spent and resources consumed.”

Resource use measures as defined by NQF are comparable measures of actual dollars or standardized units of resources applied to the care given to a specific population or event, such as a specific diagnosis or procedure.

“The Institute of Medicine puts healthcare waste at about 31% - that’s what could be removed from the system without having a negative impact on quality of care. That percentage is also corroborated by research from RAND Corporation.”

Corrigan says the top three drivers of healthcare costs are:

1. Medical errors, which have expensive consequences to fix, including longer length of stays, additional treatements and tests, and more medications.

2. Fragmented care, which inhibits communication among physicians and can lead to duplicated care efforts.

3. Most healthcare services are paid for on a fee for service basis, which drives volume. “If we look to the future, we can see that value-based payment programs that tie a percent of payment to how well a panel of the provider’s patients did would be a way to balance out that drive for volume.”

This endorsed measures are a means to evaluate how resources are used in care delivery. Several provisions in recent policy require use of resource data over the next several years to support efforts to move toward a value-based purchasing payment model, and private payers have been utilizing these types of measures for several years.

The NQF endorsed measures include:

1557: Relative Resource Use for People with Diabetes (National Committee for Quality Assurance)

1558: Relative Resource Use for People with Cardiovascular Conditions (National Committee for Quality Assurance)

1598: Total Resource Use Population-based per member per month Index (HealthPartners)

1604: Total Cost of Population-based per member  per month  Index (HealthPartners)

Go back to the Managed Healthcare Executive eNews newsletter.