Leapfrog finalizing new incentive plans
Will offset some of additional costs of compliance
The Leapfrog Group, the Washington, DC-based organization that seeks to foster improved patient safety, soon will complete a tool to help realign incentives for health care facilities that invest in meeting Leapfrog recommendations.
Leapfrog steering committee member Francois de Brantes recently explained to a meeting of the Healthcare Information and Management Systems Society in San Diego that the employer group recognizes the cost of implementing Leapfrog recommendations in areas such as computerized physician order entry systems, employing intensivists, and evidence-based hospital referrals can exceed what hospitals get from payers as a result of making those changes.
"Shame on us purchasers, shame on this country, to have created a system where better quality costs hospitals money," de Brantes said.
He added, however, that Leapfrog is developing a procedure to examine the cost of fulfilling these recommendations, forecast their fiscal impact, and help cover the difference, usually through direct payments by Leapfrog members themselves or by telling their insurers to redirect premium payments to the hospitals.
Incentives and rewards
De Brantes runs the multistakeholder Incentives and Rewards Lily Pad for Leapfrog, according to Suzanne Delbanco, PhD, executive director.
"Hospital representatives, physicians, consumers, health plans, and actuaries have been working with us for almost a year to try to figure out tools we could create for our members to figure out a sensible way to realign incentives properly," she notes.
Such tools are needed, she explains, because each practice brings different potential savings and costs, which accrue differently depending on payer mix (i.e., per diem vs. DRG) and upon how the employer is paying the hospital through the health plan.
"The work group still has its calculators out, but we hope in the next month or two to put out some basic calculations and worksheets to enable people to figure out the situations in their markets, and how to put together a rationally thought out rewards program," Delbanco says.
Using the data
In each case, real data would be used from a given area, Delbanco says. "For example, an employer might ask one of its health plans how many admissions there are in each hospital where these practices apply, what that payer mix is, and how the employer pays the hospitals."
"We would provide them with the formula for calculating savings, and they would plug in their number to understand and estimate what the savings would be in their neck of the woods," she observes.
Hospitals only will report where they are vis-a-vis their practices, Delbanco emphasizes.
"Leapfrog will then calculate costs based on what data we have available and share the information with our members. That’s the purpose of the tool," she asserts.
Based on that estimate, the employers might choose to provide incentives. "For example, Empire Blue Cross/Blue Shield in New York did it with a quarterly bonus payment," Delbanco notes.
"They said, for example, OK, we paid this hospital "x" last quarter, but we’ll tag 3% on top of that as a bonus.’ The Empire model is a direct model. The hospitals don’t get the check from IBM, for example, but from the insurer; the pass-through just eases administration," she adds.
Ideally, at the local level, you would have employers talking with hospitals, and if they want, structuring their own refinements to the incentive plan, Delbanco says. "That would be ideal. What we’ll do is provide the tools to get them started."
Delbanco refuses to set a hard deadline for the finalization of the tool. "We’re trying to get it right, rather than get it out fast," she says.
The Leapfrog Group, the Washington, DC-based organization that seeks to foster improved patient safety, soon will complete a tool to help realign incentives for health care facilities that invest in meeting Leapfrog recommendations.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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