Medicare’s pay-for-performance (P4P) program ranks and rewards hospitals according to how well they meet certain guidelines for clinical care; however, researchers at Duke Clinical Research Institute found that the program penalizes hospitals by not taking into account their greater clinical burden.
“That means that hospitals serving large groups of the elderly, women, poor, uninsured or African American patients might have problems competing with institutions whose patients are younger, wealthy, insured and white,” according to the study’s senior author Eric Peterson, MD, a cardiologist at Duke. “Hospitals are simply not starting out on the same playing field.”
Currently, Medicare does not consider demographic variables and patients' existing health problems in figuring hospital rankings. Under the current P4P program, hospitals in the top 20 percent receive financial reward; those in the middle 60 percent receive nothing, and those at the bottom stand to lose Medicare reimbursement money, according to researchers.
Peterson and colleagues examined Medicare beneficiary records of 148,472 heart attack patients in 449 hospitals across the country from 2000 to 2006. They analyzed the hospitals’ process performance on eight measures of clinical care taken from guidelines established by the Centers for Medicare & Medicaid Services (CMS) including appropriate use of certain drugs, like aspirin, beta-blockers, ACE inhibitors and anti-clotting medications; and procedures, like angioplasty and counseling to support smoking cessation.
The investigators ranked the hospitals according to crude composite process performance scores and then grouped them according to CMS’ current system. They then ranked the same hospitals a second time by taking into account the patients’ demographic variables, their clinical characteristics and eligibility for certain procedures.
They found that the hospitals with the lowest crude composite scores tended to be smaller, non-academic institutions that treated a higher percentage of older, sicker and minority patients than those in the top group.
While there was general agreement on performance between the two ranking systems, the researchers found that when taking into account patient characteristics and treatment opportunity, 16.5 percent of the hospitals would fall into a different financial status category.
“On the surface, it may well seem to be the right thing to do, but some feel such a move would ‘legitimize’ less-than-optimal care,” Peterson said. “At the same time, not taking these factors into consideration is like comparing apples to oranges.”
Peterson said that one solution might be to reward hospitals for improvement in adherence to evidence-based treatment, rather than rewarding a single score or ranking. Another option might involve separately reporting adherence data for older patients, women, or minorities. “That would surely draw more attention to any gaps in care, and might prompt better compliance,” he concluded.