Managed Care - July 2008 - (Page 45) hospital, the greater the chance that there will be a defect in care.” Virginia Mason participates in the Leapfrog hospital survey and is recognized as being one of the top performing hospitals nationally. Kaplan and Schibanoff identify waste and inefficiency as problems that increase length of stay. “Eliminate waste and cost goes down and quality goes up,” says Schibanoff. “Most hospitals in the area already complete the Leapfrog survey, which serves as the basis for the LHRP, and the program employs nationally accepted measures, so it offered advantages over developing our own program,” says Drew Oliveira, MD, Aetna’s medical director for its northwest markets. “One of the major reasons we chose the LHRP is that for 2008, the survey tool has been greatly simplified.” Aetna’s move is called a pilot because no fiHealth plans’ interest nancial incentives will be awarded in the first Horizon Blue Cross Blue Shield of New Jeryear. “We will be interested to see the first sey implemented the Leapfrog hospital survey year’s data and whether the data will help in 2006 and built a hospital recognition proimprove performance, and we also need to gram around it, as an alternative that hospitals Performance information is draw a performance baseline.” could select in lieu of an internally developed starting to be The Leapfrog Hospital Rewards Program is program.“The first year, eight hospitals chose used in contracta pay-for-performance program separate it; in 2007, 13 hospitals participated, and we ex- ing, says William from the hospital survey, but based on survey pect more than 20 hospitals for 2008,” says Finck of Horizon data. Leapfrog contracted with Discern ConWilliam Finck, director of network initiatives. Blue Cross Blue Shield of New sulting to convene a panel of providers, emAt the outset, Horizon’s recognition proJersey. ployers, health plans, and technical experts to gram followed Leapfrog’s model, and hospidevelop, among other things, new incentives that fit tals that performed in the top quartile on both with current hospital per-diem or case-rate paymeasures could receive a $225,000 bonus. Howment methodologies and address provider conever, most hospitals came in at lower levels, and cerns about the need for a multi-year reward that Horizon awarded smaller bonuses based on imreflects ongoing cost savings. provements in either measure. Finck says that in While the development of a credible efficiency many ways, hospitals are in the very first stages of measure is a significant step forward to achieving reporting on quality and efficiency, and therefore greater value, the actual payoff for hospitals and Horizon’s recognition program does not have the purchasers still depends upon incentive arrangelongitudinal data to determine the effect on outments that meet the needs of both parties. MC comes or cost. He adds that basic information about performance is starting to be used in contract negotiations. “We’re creating a template of the survey results, and the contracting staff can use it in rate negotiations to tie payment increases to quality improvements,” says Finck. Finck says that several improvements in the Leapfrog survey make it increasingly attractive, and that his company is placing more emphasis on using the Leapfrog survey over its own program. He cites the advantage of using nationally recognized measures that reduce criticism from hospitals about invalid or unfair measures and make reporting easier for hospitals. Greatly simplified Earlier this year Aetna announced that it will pilot-test the Leapfrog Hospital Rewards Program (LHRP) in Puget Sound and Spokane. “I can’t help but think that the most beautiful things to see are just beyond the curvature of the earth.” JULY 2008 / MANAGED CARE 45
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