Dartmouth is a top performer in federal project
In 2005, the federal Centers for Medicare and Medicaid Services (CMS) devised a five-year pilot project called the Physician Group Practice (PGP) Demonstration, to test the theory that financial incentives could motivate health-care organizations to provide higher-quality care for Medicare beneficiaries.
According to recently published data from the project's fourth year—2008-09—five of the 10 PGPs participating, including the Dartmouth-Hitchcock Clinic, are proving CMS right on the money. The five received bonus payments totaling $31.7 million—a share of the $38.7 million in savings they generated for Medicare.
Bonus-worthy: A participating PGP is deemed bonus-worthy if it spends at least 2% less on Medicare beneficiaries comparable to those of other providers in the area, while performing well on a series of quality benchmarks. Successful PGPs can share in up to 80% of Medicare's savings. In doling out bonuses during the first two years, CMS emphasized cost reduction over quality; since year three, cost and quality have been weighted equally.
Dartmouth-Hitchcock Clinic—a bonus recipient in all but the first year—has so far stockpiled $13 million in monetary rewards, one of the highest amounts awarded any of the 10 PGPs. Much of the focus has been on improving care management strategies, says Dr. Barbara Walters, the Clinic's senior medical director and coordinator of the project. DH has brought in recognized experts to coach physicians and support staff on evidence-based care guidelines. Triage nurses are engaged in more active and motivational outreach; for example, patients get a call a few days before an appointment, plus a follow-up call within 24 hours of a discharge. DH has also integrated more electronic tools into day-to-day practice—for instance, charts that track vital signs and vaccinations; disease registries; and reports to providers showing their individual progress on quality benchmarks. The aim is to zero in on preventive care, reducing readmissions and costly emergency procedures.
The efforts are paying off, especially with respect to meeting the project's 32 quality benchmarks. These were phased in gradually and now cover diabetes, congestive heart failure, coronary artery disease, hypertension, and cancer screening.
Quality: In year four, DH met 94% of the benchmarks, including targets for screening for breast and colorectal cancers. According to Jennifer Snide, a quality measurement analyst at DHMC, CMS stipulated that PGPs should perform mammograms in at least 75%, and colonoscopies in at least 61%, of patients falling within the defined age- and gender-based guidelines. Dartmouth surpassed both those benchmarks and has consistently done well meeting benchmarks for diabetes, too. The biggest improvement was that the percentage of patients having an annual foot exam increased from 21% to 59%.
Model: The project is widely regarded as a model for accountable care organizations (ACOs), a provision of the 2010 health reform law that has received solid bipartisan support. In a recent news release, CMS administrator Donald Berwick hailed the 10 PGPs as "leaders in organizing care delivery" and as a demonstration of what the health-care sector can achieve "if we put the right incentives in place."
But exactly what the "right incentives" are remains a point of debate. Shared savings may be a great concept, but four of the 10 PGPs have thus far never received a bonus.
"The groups who didn't receive bonuses would tell you that they didn't have a large enough [patient] population," Walters says. "As well, Medicare's 2% savings threshold is perhaps a flawed design."
In year four, Dartmouth met 94% of the project's quality benchmarks.
The lack of financial risk—participating physicians still receive their regular Medicare fee-for-service payments—has also been criticized. As an opinion piece in the October 2010 issue of the American Journal of Managed Care put it: "An approach that attempts to upset or dislocate no one" may not prove a strong enough incentive to impel physicians to change their behavior.
Right: But Walters disagrees. "Doctors want to do the right thing," she says, "and the system should be redesigned to make it easy for them to do so—then their behavior will change."
Meanwhile, DH is launching its own ACO through a joint pilot payment program with Anthem Blue Cross and Blue Shield. However, Walters says, it's "still in the early stages."
CMS is also working to transition all 10 PGPs into a newly-formed ACO program. "We're all eager to continue the good collaboration and improved clinical care begun with [the demo]," says Walters, "and make the terms and conditions better in partnership with Medicare."
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