The Centers for Medicare and Medicaid Services just announced that the selection of five organizations to participate in a demonstration project designed, under a 2008 Congressional mandate (PDF), to encourage more efficient utilization of advanced imaging technologies. In the demonstration, participating physicians will use advanced decision support information systems to receive instant feedback on whether their imaging referrals are consistent with practice standards promulgated by the relevant specialty societies. Imaging utilization will be compared to utilization by non-participating physicians as well as to that mandated by the professional society protocols. In short, the demonstration will test whether feedback re: compliance with standard protocols leads to improved protocol compliance and whether it also leads to reduced utilization. The demonstration precludes the use of pre-authorization or non-coverage to influence utilization levels; it relies almost completely on physician response to information at the point of decision-making.
The power of this kind of feedback was demonstrated years ago at Harvard Community Health Plan by Dr. Donald Berwick. I have close personal experience with a similar program implemented by Dr. Edmund Lowrie for dialysis provider National Medical Care (now Fresenius Medical Care) some 25 years ago. In both of these cases, giving physicians information about how their performance compared to their peers in terms of protocol compliance (at HCHP) or basic quality parameters (at NMC) was a powerful mechanism — in the absence of any penalties — in focusing their attention and improving their performance. Under-performers worked to achieve or exceed the means; the best performers worked to maintain their leadership (even in the absence of being identified to the larger group); mean system performance improved consistently.
The principal goals of healthcare reform are to constrain the growth of healthcare spending and to improve health outcomes. We need, in other words, to pay less for more. The fact that so many across all segments of the domestic political spectrum believe that this combination of goals is reasonable — while differing greatly on how they might be achieved — testifies to our near-universal recognition that the U. S. health care marketplace is, at best, extraordinarily inefficient. Classical microeconomics teaches us that inefficient markets are characterized by serious deficits in information flow, distribution and utilization. A perfectly efficient market has “perfect” information — everything you need to know instantly, equally, universally and freely available. That, of course, is an ideal achievable only in the realm of pure theory — but keeping it in mind can point us in a constructive direction as we wrestle with the problem of creating a more efficient health care economy in the here and now. Information is the lynch-pin of system improvement.
The Patient Protection & Affordable Care Act — the President Barack Obama’s healthcare reform law — recognizes the role of improved information flow and use in achieving health care cost control and quality improvement. That is why comparative effectiveness research, electronic health records, and healthcare IT "meaningful use” by physicians are so central to the enterprise — despite the fact that none of those initiatives directly impacts costs. They all provide new information and/or facilitate transfer of information. At-risk integrated provider organizations, including Accountable Care Organizations under the act, are appropriately incented to manage costs while achieving improved outcomes, and require these information resources in order to do so.
The imaging utilization demonstration project provides the opportunity and context for some cautionary perspective on two additional aspects of the relationship between improved information and improved healthcare system performance. First, we cannot expect anything to change very quickly. The 2008 legislation set a demonstration implementation date of Jan. 1, 2010; it is running more than a year late. The demonstration will last for two years and there will then be an evaluation report. We won’t have definitive findings and recommendations, in other words, for at least three years … and then — assuming clear findings — the process of deciding how to implement those findings more broadly will begin. The improved system performance result is a long way off.
Second, the same information systems, resources and decision support tools that provide the necessaries for improved voluntary physician protocol compliance and resource utilization can be used by insurers to recognize over-utilization, implement instantaneous comparison of tests to professional society protocols and enforce increasingly sophisticated and nuanced coverage policies for expensive imaging modalities and other interventions. Today, insurers incur substantial costs for every treatment modality subjected to medical appropriateness review; they of necessity must pick their spots, targeting a few high profile areas where there are indications of poor voluntary compliance. With universal implementation of readily transferable electronic health records and the availability of sophisticated decision support tools, claims can be subjected to a wide variety of appropriateness or policy compliance reviews with little incremental cost. Coverage policies can become more sophisticated in response to new standards of care and/or research findings, and can be more rigorously enforced. Better information and information technology can be a game-changer for payers as well as providers. And I haven’t even begun to talk about how powerful it can and will be in post-approval monitoring for the Food & Drug Administration — I’ll address that subject, which is not all bad news for technology developers — in a future post.
Edward Berger is a senior healthcare executive with more than 25 years of experience in medical device reimbursement analysis, planning and advocacy. He’s the founder of Larchmont Strategic Advisors and the vice president of the Medical Development Group. Check him out at Larchmont Strategic Advisors.