Pennsylvania Health Care Cost Containment Council (PHC4) We’re not in Kansas We’re not in Kansas...

Pennsylvania Health Care Cost Containment Council (PHC4)Pennsylvania Health Care Cost Containment Council (PHC4)

We’re not in Kansas We’re not in Kansas

anymore…part 2anymore…part 2

Public Transparency and Public Transparency and Accountability: A Threat, or an Accountability: A Threat, or an

Opportunity?Opportunity?

Marc P. VolavkaMarc P. Volavka

Executive Director Executive Director

Pennsylvania Health Care Cost Containment CouncilPennsylvania Health Care Cost Containment Council


What I’ll try and do:What I’ll try and do:

Three points:Three points:1) a bit about the history of the 1) a bit about the history of the

Council;Council;2) a bit about public reporting and 2) a bit about public reporting and

transparency;transparency;3) a bit about hospital acquired 3) a bit about hospital acquired

infections.infections.


About PHC4About PHC4

Independent state agency established Independent state agency established in 1986in 1986

Improve the quality and restrain the Improve the quality and restrain the cost of health care by PUBLICLY cost of health care by PUBLICLY releasing data and reportsreleasing data and reports

Promote competition in the health care Promote competition in the health care marketplacemarketplace


Sounds a bit like a 1980’s version of Sounds a bit like a 1980’s version of

““transparency”, doesn’t it?transparency”, doesn’t it?


Council MembersCouncil Members

PurchasersPurchasers 6 Business6 Business 6 Labor6 Labor 1 Consumer1 Consumer

InsurersInsurers 1 Commercial1 Commercial 1 Non-Profit (Blues)1 Non-Profit (Blues) 1 HMO1 HMO

ProvidersProviders 2 Hospital2 Hospital 2 Physician2 Physician 1 Nurse1 Nurse 1 Health Care Quality 1 Health Care Quality

Improvement ExpertImprovement Expert

State GovernmentState Government Secretary of Health Secretary of Health Secretary of WelfareSecretary of Welfare Insurance Insurance

CommissionerCommissioner


PHC4 Data Sources:PHC4 Data Sources:

178 Acute Care Hospitals representing 178 Acute Care Hospitals representing about 1.9 million inpatient admissionsabout 1.9 million inpatient admissions

Over 200 Surgery Centers representing Over 200 Surgery Centers representing about 2.5 million visitsabout 2.5 million visits

Third party insurers, including Medicare Third party insurers, including Medicare and Medicaidand Medicaid


What data do we collect?What data do we collect? 4 million inpatient hospital discharge4 million inpatient hospital discharge

& ambulatory procedure records/year& ambulatory procedure records/year

More than 80 data fields availableMore than 80 data fields available

Hospital Financial and Utilization DataHospital Financial and Utilization Data

Actual payment from 3Actual payment from 3rdrd party payors party payorsUpdated 10/20/03Updated 10/20/03


Public ReportsPublic Reports

Hospital Performance ReportHospital Performance Report

Heart Bypass Report (physician specific)Heart Bypass Report (physician specific)

Hospital Financial ReportHospital Financial Report

Commercial Managed Care ReportCommercial Managed Care Report

Medicare Managed Care ReportMedicare Managed Care Report

Diabetes Hospitalization ReportDiabetes Hospitalization Report

Hip & Knee replacement (physician specific)Hip & Knee replacement (physician specific)

Hospital Acquired InfectionsHospital Acquired Infections


Transparency and Consumerism?Transparency and Consumerism?

When the Federal Government speaks, When the Federal Government speaks, it must be so!it must be so!


News ReleaseFOR IMMEDIATE RELEASEThursday, June 1, 2006

Medicare Posts Hospital Payment InformationImportant Step Toward Transparency in Health Care Costs and Quality

To help consumers, providers, and payers make more informed health care decisions, the Department of Health and Human Services through its Centers for Medicare & Medicaid Services (CMS) today posted information on what Medicare pays for 30 common elective procedures and other hospital admissions. President Bush directed the data be made publicly available to all Americans as part of the Administration’s commitment to make health care more affordable and accessible.

“Once people gain better information, they become better consumers of health care and that helps get health care costs down and quality of care up,” HHS Secretary

“Once people gain better information, they become better consumers of health care and that helps get health care costs down and quality of care up,” HHS Secretary Mike Leavitt said. “The federal government is the biggest single purchaser of health care in America, and by taking steps to post prices and quality data, we hope to encourage more insurance companies, hospitals, clinics and doctors to do the same.”

“Once people gain better information, they become better consumers of health care and that helps get health care costs down and quality of care up,” HHS Secretary Mike Leavitt said. “The federal government is the biggest single purchaser of health care in America, and by taking steps to post prices and quality data, we hope to encourage more insurance companies, hospitals, clinics and doctors to do the same.”


Question:Question:

What does “consumerism” and What does “consumerism” and “transparency” mean in the world of “transparency” mean in the world of 2006??2006??


Answer: Answer: (2 more questions) (2 more questions)

1.1. How much is it gonna cost me?How much is it gonna cost me?

2.2. Am I gonna be ok?Am I gonna be ok?

(and, probably in that order)(and, probably in that order)


And, although I know this will come as a And, although I know this will come as a SHOCK to you, the Federal Government SHOCK to you, the Federal Government

wasn’t the first to “discover” wasn’t the first to “discover” transparency, even in pricing!transparency, even in pricing!


So, here’s a riddle for your So, here’s a riddle for your amusement:amusement:

When does HIPPA prevent a major 3When does HIPPA prevent a major 3rdrd party insurer from providing payment party insurer from providing payment data to PHC4??data to PHC4??


Answer:Answer:

Prior to August 17Prior to August 17thth, 2005…, 2005…

When their legal counsel says so!When their legal counsel says so!


Now:Now:

When does HIPPA When does HIPPA ALLOWALLOW a major 3 a major 3rdrd party insurer from providing payment party insurer from providing payment data to PHC4??data to PHC4??


Answer:Answer:

After August 18After August 18thth, 2005…When their , 2005…When their legal counsel says so!legal counsel says so!


Insurer Reveals What Doctors Really ChargeTo Help People Compare Fees, Aetna Posts Some Online;A Potential Bargaining ToolBy VANESSA FUHRMANS Staff Reporter of THE WALL STREET JOURNALAugust 18, 2005

The growing effort to enlist consumers in reducing health-care costs has been stymied by the fact that most people just don't know what medical care costs.

Private and government health coverage has helped shield them from bills. And even with newer consumer-driven plans that employ Health Savings Accounts, which give people more of a financial stake in the issue, pricing information can be hard to come by.

Now, a major national health insurer is making an effort to change that. Starting tomorrow, Aetna Inc. plans to make available online the exact prices

Starting tomorrow, Aetna Inc. plans to make available online the exact prices it has negotiated with Cincinnati-area doctors for hundreds of medical procedures and tests. The initiative, which Aetna hopes to take eventually to other parts of the country, aims to give patients the tools to comparison shop and make savvier decisions with their health-care dollars.

Starting tomorrow, Aetna Inc. plans to make available online the exact prices it has negotiated with Cincinnati-area doctors for hundreds of medical procedures and tests. The initiative, which Aetna hopes to take eventually to other parts of the country, aims to give patients the tools to comparison shop and make savvier decisions with their health-care dollars.


Notice the date?Notice the date?


In Pennsylvania, with PHC4, we’ve In Pennsylvania, with PHC4, we’ve been answering one of the been answering one of the

questions (quality) for awhile, and questions (quality) for awhile, and we’re now starting to answer the we’re now starting to answer the

other one (pricing)…other one (pricing)…


This is what “transparency”This is what “transparency”looked like, with our first report on looked like, with our first report on

hospital performance, in 1989:hospital performance, in 1989:


We’ve come a long way since We’ve come a long way since then:then:


Since 1989, we’ve been Since 1989, we’ve been demonstrating that you CAN bring demonstrating that you CAN bring some public disclosure to hospital some public disclosure to hospital

and physician “quality”.and physician “quality”.


A study to be released today by the Pennsylvania Health Care Cost Containment Council echoes her questions. It found that readmissions at hospitals across the commonwealth rose last year even as death rates declined.

A study to be released today by the Pennsylvania Health Care Cost Containment Council echoes her questions. It found that readmissions at hospitals across the commonwealth rose last year even as death rates declined.


But, does it really matter?But, does it really matter?


At the same time, the council reported significant improvement in a key quality measure – deaths.

Overall, the death rates in Pennsylvania’s hospitals in the categories examined have declined faster than the national average since 1991, the report said.

At the same time, the council reported significant improvement in a key quality measure – deaths.

Overall, the death rates in Pennsylvania’s hospitals in the categories examined have declined faster than the national average since 1991, the report said.


Here’s what we believe 20 years of Here’s what we believe 20 years of “transparency” have contributed “transparency” have contributed

to in Pennsylvania:to in Pennsylvania:


“Now we face the harder job of making changes in the processes of care at our hospitals to reduce infection rates, complications of care, medical errors and patient readmissions,” said David B. Nash, chairman of the department of health policy at Jefferson Medical College.

“Now we face the harder job of making changes in the processes of care at our hospitals to reduce infection rates, complications of care, medical errors and patient readmissions,” said David B. Nash, chairman of the department of health policy at Jefferson Medical College.

Despite some limitations to this report, experts said public disclosure of quality paid off.

“There is growing evidence that in states with public reporting on health-care quality, mortality is lower and got there faster,” Nash said.

Despite some limitations to this report, experts said public disclosure of quality paid off.

“There is growing evidence that in states with public reporting on health-care quality, mortality is lower and got there faster,” Nash said.


Now, I’ll fully admit that risk Now, I’ll fully admit that risk adjusted CABG mortality, or risk adjusted CABG mortality, or risk

adjusted LOS aren’t exactly adjusted LOS aren’t exactly flowing off the tongues of PA flowing off the tongues of PA

consumers!consumers!


But, Hospital acquired infections…But, Hospital acquired infections…

Now THAT got peoples attention!Now THAT got peoples attention!


Data Show Scourge of Hospital InfectionsData Show Scourge of Hospital Infections

Alarms raised on hospital infections


That wasn’t so much of a That wasn’t so much of a surprise…surprise…


But, I also got some interesting But, I also got some interesting Fed Ex packages with Fed Ex packages with

“solutions”…“solutions”…


These These werewere a surprise!! a surprise!!


Let me show you what caught Let me show you what caught the nations attention, when we the nations attention, when we reported HAI’s on a Statewide reported HAI’s on a Statewide basis, in July of 2005:basis, in July of 2005:


11,668 patients were 11,668 patients were confirmedconfirmed by PA hospitals as by PA hospitals as having 4 types of HAI having 4 types of HAI (using CDC guidelines)(using CDC guidelines)

1793 died1793 died

1510 deaths were above what would have been 1510 deaths were above what would have been expectedexpected

205,000 extra days in the hospital205,000 extra days in the hospital

$2 BILLION in extra hospital billing that was sent to $2 BILLION in extra hospital billing that was sent to someone to paysomeone to pay


And, the national media got the And, the national media got the two key points:two key points:


Hospital-acquired infections Hospital-acquired infections are deadly.are deadly.


For 2004, in PA:For 2004, in PA:

1,000 Patients1,000 Patients

(Who get an HAI) (Who get an HAI) 130 Die130 Die

1,000 Patients1,000 Patients

(No HAI) (No HAI) 24 Die 24 Die

Additional DeathsAdditional Deaths 104 Additional 104 Additional Deaths Deaths

Per 1,000 PatientsPer 1,000 Patients


In other words, if you got an infection in a In other words, if you got an infection in a PA hospital in 2004, the PA hospital in 2004, the odds of dieing odds of dieing during that hospitalization were 5.41 greater during that hospitalization were 5.41 greater than if you didn’t.than if you didn’t.

I Don’t Like Those Odds!!!!I Don’t Like Those Odds!!!!


Second…Second…


The costs of hospital-The costs of hospital-acquired infections are acquired infections are

staggering.staggering.


In 2004, PA received ACTUAL In 2004, PA received ACTUAL payment data from our 3payment data from our 3rdrd

party commercial insurers…party commercial insurers…not charges…PAYMENTS!not charges…PAYMENTS!


We linked hospital confirmed We linked hospital confirmed HAI patients with the ACTUAL HAI patients with the ACTUAL

payments made for each of payments made for each of those patients…those patients…


So, we’re going to have a little So, we’re going to have a little test here:test here:

Let’s see who knows what it Let’s see who knows what it actually costs the person actually costs the person

PAYING the bill:PAYING the bill:


In PA, the average PAYMENT In PA, the average PAYMENT for an acute care hospital stay for an acute care hospital stay

is: $8,078is: $8,078


Ok, so what does the average Ok, so what does the average hospitalization WITH a hospitalization WITH a

hospital acquired infection hospital acquired infection cost?cost?

A) $22,247A) $22,247B) $33,698 B) $33,698 C) $48,445C) $48,445D) $54,807 D) $54,807 E) none of the aboveE) none of the above

$60,678$60,678

Average PAYMENT!!Average PAYMENT!!


……and, that’s JUST the and, that’s JUST the hospital portion…that hospital portion…that

doesn’t include a penny for doesn’t include a penny for the physician payments to the physician payments to

treat that patient…treat that patient…


……nor, the ACTUAL costs nor, the ACTUAL costs for the hospital…for the hospital…


Now, what does your average Now, what does your average consumer, or payor, think consumer, or payor, think about that?about that?


Stay tuned:Stay tuned:

Coming to your local theaters on Coming to your local theaters on November 14, 2006…November 14, 2006…

11stst Hospital Acquired Infection Public Hospital Acquired Infection Public Report, specific to 170 PA HospitalsReport, specific to 170 PA Hospitals


No folks…No folks…

We’re not in We’re not in Kansas Kansas anymore…anymore…

Pennsylvania Health Care Cost Containment Council (PHC4) We’re not in Kansas We’re not in Kansas...

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