The field of hospital medicine was built on the premise that hospitalists would promote and deliver more efficient, safer, and higher-quality inpatient care. Indeed, over the past decade hospitalist care has led to shorter lengths of stay and relatively lower hospital costs. However, as national health care costs have continued to rise unabated, on track to consume approximately 20% of the United States gross domestic product by 2020, the government, payers, and the public have all focused renewed efforts on improving health care value—commonly defined as
Hospital costs represent the single largest segment of the nearly $3 trillion annual US health care expenditure. Thus, hospitalists are vital to any effort to rein in health care costs. This chapter reviews concepts and strategies critical for hospitalists to understand in the emerging world of value-based health care.
HOSPITAL COSTS IN THE NATIONAL SPOTLIGHT
In February 2013, Time magazine published an expose on health care costs, “Bitter Pill: Why Medical Bills Are Killing Us,” which was trumpeted across popular media and helped the hospital “chargemaster” become nearly a household term. The chargemaster (also known as the charge description master or “CDM”) is the list of prices for the tens of thousands of billable items at a given hospital. Shortly following the Time article, the Centers for Medicare and Medicaid Services (CMS) publicly released a database of how hospitals billed Medicare for the 100 most common inpatient procedures, revealing in stark relief the baffling amount of variation in charges and reimbursements for the same procedures between similar hospitals. Later that same year, the New York Times published a front-page article with the headline, “As Hospital Prices Soar, a Stitch Tops $500,” continuing to shine a bright national spotlight on the issue of hospital costs. As the “Bitter Pill” and the “$500 stitch” highlighted, charges found on hospital bills usually appear arbitrary and grossly inflated.
Despite the pressures to increase transparency, health care costs have largely remained hidden from the public and medical professionals. As a result, hospitalists are generally not aware of the costs associated with their care. In addition, most clinicians find the concepts of “charge,” “price,” “cost,” and “reimbursement” confusing (Table 2-1). In most medical centers, the majority of health care transactions occur between the organization and large payer organizations, such as insurance companies or Medicare. The price or charge refers to the amount reported on the bill to each of these payers. The cost depends on perspective; providers, payers, and patients each evaluate costs differently:
To providers, costs are the expense incurred to deliver health care services to patients.
To payers, costs are the amount payable to the provider for services rendered.
To patients, costs are the amount payable out-of-pocket for health care services.
TABLE 2-1Costs, Charges, Reimbursements, and Prices in Health Care ||Download (.pdf) TABLE 2-1 Costs, Charges, Reimbursements, and Prices in Health Care
|Term ||Definition |
|Cost ||Account of the true cost of providing health services, defined from a specific stakeholder perspective (provider, patient, payer, society) |
|Charge ||Amount asked by a provider for delivering a service (typically more than reimbursement, used as a starting point for negotiation) |
|Reimbursement ||Amount paid to the provider for delivering a service |
|Price ||Amount paid by the patient for receiving a service |
The chargemaster is theoretically meant to relate to both costs and payments, but since there is tremendous inexplicable variation in prices between similar organizations and because the prices are highly inflated, the chargemaster routinely fails at this function. Instead, the chargemaster is generally used as a starting point for closed-door bargaining with different payers. While insurance companies pay a relatively small fraction of the charge on the chargemaster, uninsured patients have often been stuck with full chargemaster prices.
The Affordable Care Act (ACA) now formally requires all providers to publish their chargemasters, and some states are requiring hospitals to also disclose the “allowed amount” (contractually agreed amount paid by a private insurance company) to any patient who asks. In California, health care providers cannot bill uninsured patients an amount greater than the reimbursement the hospital would receive from a government payer.
Newer methods for determining more accurate measurements of actual costs are now increasingly being applied in health care. For example, Michael Porter and Robert Kaplan from Harvard Business School have advocated for the use of time-driven activity-based costing (TDABC). With TDABC, the costs of space, nonconsumable equipment, and administrative overhead are all assigned minute-to-minute cost rates that are relevant to specific processes of care. The care that is delivered over an entire episode of care is broken down into discrete activities or process steps, such as check-in, vitals and intake, physician evaluation, nursing care, and so on. A cost is assigned to each step by tracking who is doing the activity, what resources they use, which space they are in, and how long it takes them. Each item (personnel, resources, and space) is assigned a per-minute cost rate by bundling together all costs (fixed and variable) and then dividing by the total amount available for patient care. For a more detailed explanation of TDABC, one can refer to “How to Solve the Cost Crisis in Health Care” by Kaplan and Porter in the Harvard Business Review (2011). Using TDABC, some progressive medical centers have begun to establish a true “cost-master” to replace the controversial charge-master.
THE EFFECT OF PRICE TRANSPARENCY ON HOSPITALIST ORDERING PRACTICES
One seemingly obvious solution to hospitalists’ lack of knowledge about costs is to provide diagnostic test prices at the point of ordering. After all, many have remarked that when ordering off a menu without prices, it is easy to unwittingly order the filet mignon every time. So, why not just put the prices back on the menu?
Initial studies on this strategy showed mixed results, and the conventional wisdom evolved that displaying price information had limited effect, with prices often becoming “white noise” and being quickly disregarded. More recent studies, however, including a controlled trial at Johns Hopkins suggest that, perhaps due to the recent global attention to the importance of health care costs, clinicians are now more likely to react to price information. Displaying the Medicare Allowable Rates of lab tests to hospital physicians led to substantial decreases in certain higher-cost lab tests and resulted in a more than $400,000 net cost reduction over the course of a 6-month intervention period. It is not clear if this effect too will abate over time.
Similarly, a study using dollar signs () to translate relative costs of antibiotics on culture and susceptibility testing reports resulted in a significant decrease in prescriptions for high-cost antibiotics.
Taken as a whole, a 2015 systematic review on the topic of providing price information for diagnostic testing concluded that “charge information changed ordering and prescribing behavior” in the majority of studies.
Remaining challenges include determining which price to display (the charge, the Medicare allowable fee, the estimated marginal cost, or some other measure), as well as whether prices should be displayed for all orders or rather be limited to only specific orders that may be ordered frequently or that are associated with high cost or marginal benefit.
HOSPITAL PAYMENTS SHIFTING FROM VOLUME TO VALUE
If there is one thing that most policymakers can agree on, it is that the payment system, which currently rewards volume of services delivered, should be realigned to compel the delivery of value. Not all policymakers, however, agree exactly how to best do that.
Medicare’s Value-Based Purchasing (VBP) program has already tied a percentage of hospital payments to metrics of quality, patient satisfaction, and cost. In addition, with the proliferation of accountable care organizations (ACOs) and other bundled payment models, hospitals will continue to have an increasing share of reimbursement at risk related to the value of care that they deliver. According to the US Health and Human Services Secretary, Medicare aims to have at least 50% of all payments tied to quality or value through alternative payment models by the end of 2018.
MEDICARE’S HOSPITAL VALUE-BASED PURCHASING PROGRAM
The federal government introduced their hospital VBP program in 2012, initially with 1% of Medicare hospital payments based on some measures of quality. This percentage will continue to rise. The first quality indicators included process measures for pneumonia, acute myocardial infarction, congestive heart failure, health care-associated infections, and patient experience (largely based on patient survey responses to the Hospital Consumer Assessment of Healthcare Providers and Systems Hospital survey [HCAHPS]). Subsequently, risk-adjusted mortality, hospital-acquired conditions, and patient safety were added. The 2016 VBP metrics include eight clinical process of care measures, eight patient experience dimensions, three 30-day mortality outcome measures, one Agency for Healthcare Research and Quality composite score, four health care-associated infection rates, and one efficiency measure based on Medicare spending per beneficiary (Table 2-2).
TABLE 2-2Medicare’s Hospital Value-Based Purchasing Metrics for Fiscal Year 2016 ||Download (.pdf) TABLE 2-2 Medicare’s Hospital Value-Based Purchasing Metrics for Fiscal Year 2016
|Domain ||Weight ||Measures |
|Clinical process of care ||10% || |
Fibrinolytic therapy received within 30 min of hospital arrival in patients with acute myocardial infarction
Initial antibiotic selection for community acquired pneumonia in immunocompetent patient
Surgery patient on a beta blocker prior to arrival that received a beta blocker during perioperative period
Prophylactic antibiotic selection for surgical patients
Prophylactic antibiotics discontinued within 24 h after surgery ends
Postoperative urinary catheter removal on postoperative day 1 or 2
Surgery patient who received appropriate venous thromboembolism prophylaxis within 24 h prior to surgery to 24 h after surgery
|Patient experience of care ||25% || |
Communication with nurses
Communication with doctors
Responsiveness of hospital staff
Communication about medicines
Cleanliness and quietness of hospital environment
Overall rating of hospital
|Outcome ||40% || |
Acute myocardial infarction 30-d mortality rate
Heart failure 30-d mortality rate
Pneumonia 30-d mortality rate
Complication/patient safety indicators (AHRQ PSI-90 composite score)
Catheter-associated urinary tract infection
Central line-associated bloodstream infection
Surgical site infections in colon surgery and abdominal hysterectomy
|Efficiency ||25% ||Medicare spending per beneficiary |
Payment for achieving higher-quality metrics seems to be a step in the right direction for our health care system, but there are criticisms that the current mechanism will unfairly punish safety net hospitals and clinicians caring for the most vulnerable populations.
CMS hopes to also drive value through better public transparency of quality and cost data via their Hospital Compare website (www.medicare.gov/hospitalcompare). Hospital Compare provides data on a large number of metrics and even allows the public to select up to three hospitals at a time to compare head to head. In an effort to make the website more user-friendly for public consumers, CMS recently borrowed a strategy from the vast majority of popular rating websites and added a “star rating.” The star rating, from one to five stars, is initially based on validated patient experience metrics.
BUNDLED PAYMENTS AND ACCOUNTABLE CARE ORGANIZATIONS
Whereas the VBP program is based on annual rewards and penalties, other payment models including bundled payments aim to more directly incentivize quality and efficiency. Strategies for payments exist on a spectrum from straight fee-for-service to fixed global budgets. If we consider reimbursements to a hospital, a payer may pay a specific amount for every service delivered (fee-for-service), for each day in the hospital (Per Diem), for each episode of hospitalization (eg, Diagnosis Related Groups [DRGs]), or for each patient in their community considered to be under their care (Capitation). Alternatively, the hospital could be given a fixed fee for all services performed on every patient during a full year (Global Budget). Currently, the majority of payments are still primarily based on fee-for-service, but this is projected to rapidly change (Figure 2-1).
Hospital or hospital system reimbursements. (The State of Value-Based Reimbursement and the Transition from Volume to Value in 2014. McKesson Health Solutions, 2014.)
Bundled payments could theoretically encourage improved efficiency and reductions in hospital-acquired complications as these would lead to increased costs, length of stay, and spent resources. For example, a hospital could be paid one fee for pneumonia, regardless of the number and type of interventions or resources used. CMS has used a prospective flat fee per inpatient episode of care, based on a diagnosis-related group (DRG) system, since 1983. CMS sets the base payment amounts “for the operating and capital costs that efficient facilities would be expected to incur in furnishing covered inpatient services.” This rate is then weighted by DRG (which accounts for relative severity of a given condition), and then adjusted according to an algorithm that accounts for a number of factors such as the regional cost of labor, and whether the hospital is a teaching facility. Medicare also provides higher payments for patients with “complicating or comorbid conditions,” or with “major complicating or comorbid conditions.” For particularly complex patients, Medicare provides “outlier payments” that are calculated based on an imprecise ratio of costs to charges.
Global or bundle payments could potentially combine payments across different providers and settings, encouraging better coordination and communication between hospitals, postacute care facilities (eg, a skilled nursing facility [SNF]), and outpatient providers. This is some of the logic behind the emergence of ACOs, which were included as part of the ACA to provide an experiment in global payments and shared risk. According to the CMS definition, ACOs are “groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients.” When an ACO delivers high quality care at low costs, the organization shares in the savings that the ACO achieves.
Interpretations of the early results of ACOs have been mixed. The pilot Pioneer ACO program, which included 32 medical care organizations, was estimated to save 1.2% of health care spending, translating to about $400 million, over the first 2 years. Critics point out that the pilot programs were highly selected and unlikely to represent the abilities of the rest of the health care system once the model is more widely deployed. Moreover, 13 of the 32 pilot programs had dropped out due to not achieving savings in the first year or because they felt that the program was too complex with too many quality metrics to track. While we await additional research evidence on the true potential impact of ACOs, their premise in improving efficiency and coordinated care is strong, and their numbers will likely expand in the near future.
The Institute of Medicine (IOM) estimated that over $750 billion annually spent on health care does not make anyone healthier, and thus is considered waste. This represents up to more than 30 cents on every health care dollar spent. Although there are many contributors to health care waste including prices that are excessively high, unwarranted administrative costs, fraud, and inefficiencies due to system errors and failures of coordination, the largest component is unnecessary services, which includes overuse, discretionary use beyond benchmarks, and unnecessary choice of higher-cost services (Table 2-3). Unnecessary services account for $210 billion of waste annually. This is the area of waste that individual hospitalists have the most direct control over.
TABLE 2-3Areas of Health Care Waste ||Download (.pdf) TABLE 2-3 Areas of Health Care Waste
|Areas of Waste in Healthcare ||Annual Amount ||Examples ||Potential Strategies for Addressing |
|Unnecessary services ||$210 billion ||Antibiotics for nonbacterial infections or MRIs for routine low back pain ||Clinician decision making, “Choosing Wisely,” appropriateness criteria, high-value care committees or programs |
|Inefficiently delivered services ||$130 billion ||Lack of interoperability between electronic health records resulting in missing information ||Lean, care pathway redesign, accountable care organizations, electronic health record coordination |
|Prices that are too high ||$105 billion ||MRIs cost approximately $1080 in the United States and $280 in France, mostly due to differences in price setting ||Cost transparency, regulatory measures |
|Excess administrative costs ||$190 billion ||American medical providers spend four times as much interacting with insurance companies compared to Canadians (who have a single payer system) ||Payment reform, insurance form standardizations |
|Fraud ||$75 billion ||Billing for services that were not rendered, or “upcoding” for a procedure or diagnosis that is more complex than the actual procedure or diagnosis ||FBI and other law enforcement |
|Missed prevention opportunities ||$55 billion ||Failing to provide appropriate immunizations or counseling ||Improved access to primary care, decision support systems, accountable care organizations |
|TOTAL ||$750 billion || || |
OVERUSE IS A PATIENT SAFETY PROBLEM
The 1998 IOM National Roundtable on Healthcare Quality classified three types of health care quality problems: underuse, overuse, and misuse. However, the following decade of the patient safety movement focused nearly exclusively on preventable complications related to misuse. Only recently has overuse of medical care—which refers to providing care in circumstances where the potential for harm exceeds the potential benefits—gained attention as an important patient safety hazard.
Overuse of medical care is a widespread problem in the US health care system. According to a 2011 study, nearly half of primary care physicians in the United States believe that their patients are receiving too much care. Overuse of medical care can directly lead to patient harm as a result of the known risks or adverse effects of the provided test, procedure, or medication. There are numerous frequently cited instances of overuse, including inappropriate imaging, laboratory tests, antibiotics, and catheter usage (Table 2-4). For example, despite evidence and clear guidelines that suggest imaging is unhelpful for patients with acute low back pain who lack specific clinical findings, routine diagnostic imaging is frequently obtained for these patients. This places patients at risk for excessive radiation, costs, and substantial downstream effects, including ineffective spine operations and perceptions of lessened overall health status.
TABLE 2-4Common Examples of Overuse in Medical Care ||Download (.pdf) TABLE 2-4 Common Examples of Overuse in Medical Care
|Some Common Areas of Overuse ||Examples |
|Antibiotics for nonbacterial illnesses || |
70% of patients with acute bronchitis are prescribed antibiotics, a rate that has been increasing over time
Antibiotic prescribing could potentially be improved in 37% of common inpatient prescription scenarios, according to the Centers for Disease Control and Prevention
|Diagnostic imaging || |
|Laboratory testing || |
Approximately 20% of lab testing may represent overutilization
Daily blood tests are routinely drawn in many patients in the hospital, which can contribute to hospital-acquired anemia
|Urinary and central venous catheters || |
Between 21% and 63% of urinary catheters are placed in patients who do not have an appropriate indication
According to one study, hospitalists felt 10%-25% of peripherally inserted central catheters (PICCs) placed at their facility were inappropriate or avoidable
Antibiotic prescribing is another area rife with overuse, which has led to the emergence of a number of antibiotic-resistant pathogens, making infections more difficult to treat. When prescribed incorrectly, antibiotics pose serious risks to both individual patients and the public health at large. Antibiotic overuse can place patients at risk for allergic reactions, antibiotic-associated diarrhea, and other dangerous adverse effects.
More medical care may also lead to overdiagnosis and overtreatment, which may result in a cascade effect of potential harms, including adverse events, mistakes, anxiety and disability, and additional unnecessary treatments. With patients bearing more and more of the cost of care themselves, some have further argued that clinicians should also consider the potential financial harm to individual patients due to excessive medical evaluations and subsequent overtreatments.
The many drivers of overuse include medical culture, fee-for-service payments, patient expectations, and fear of malpractice litigation. A survey study using clinical vignettes of common hospital clinical situations revealed a large amount of overuse of testing among practicing hospitalists, with 52% to 65% of respondents requesting unnecessary testing in a preoperative evaluation scenario, and 82% to 85% in a syncope work-up scenario. The majority of physicians reported that they knew the testing was not clinically indicated based on evidence or guidelines, but were ordering the test due to a desire to reassure the patients or themselves. This finding suggests efforts to decrease overuse will need to engage clinicians and patients in ways that help overcome the attitude that more testing is required to provide reassurance.
STRATEGIES FOR HOSPITALISTS TO PROVIDE HIGH-VALUE CARE
As payment systems and health care organizations shift toward rewarding and supporting a focus on value, individual hospitalists can help deliver higher value care for their patients through: (1) providing appropriate care, (2) ensuring care coordination, (3) considering patient affordability in customizing treatment plans, and (4) leading local value improvement initiatives.
PROVIDING APPROPRIATE CARE
Hospitalists should address the problem of overuse by directly practicing appropriate care for their patients. Emerging resources for identifying specific targets of common overuse include the Choosing Wisely lists, guidelines, and appropriateness criteria. The Choosing Wisely campaign (www.choosingwisely.org) is an effort organized by the ABIM Foundation to engage specialty societies in identifying lists of commonly overused medical services “that physicians and patients should question.” In 2013, the Society of Hospital Medicine published an initial Choosing Wisely list for both adult and pediatric hospital medicine (Table 2-5), and many other professional organizations’ Choosing Wisely lists (eg, American College of Physicians, American Academy of Neurology, etc) have components that apply directly or indirectly to hospital medicine practice.
TABLE 2-5Society of Hospital Medicine Choosing Wisely Lists ||Download (.pdf) TABLE 2-5 Society of Hospital Medicine Choosing Wisely Lists
|Adult Hospital Medicine Recommendations ||Pediatric Hospital Medicine Recommendations |
|1. Do not place, or leave in place, urinary catheters for incontinence or convenience, or monitoring of output for noncritically ill patients (acceptable indications: critical illness, obstruction, hospice, perioperatively for <2 d or urologic procedures; use weights instead to monitor diuresis). ||1. Do not order chest radiographs in children with uncomplicated asthma or bronchiolitis. |
|2. Do not prescribe medications for stress ulcer prophylaxis to medical inpatients unless at high risk for GI complication. ||2. Do not routinely use bronchodilators in children with bronchiolitis. |
|3. Avoid transfusing red blood cells just because hemoglobin levels are below arbitrary thresholds such as 10, 9, or even 8 mg/dL in the absence of symptoms. ||3. Do not use systemic corticosteroids in children under 2 y of age with an uncomplicated lower respiratory tract infection. |
|4. Avoid overuse/unnecessary use of telemetry monitoring in the hospital, particularly for patients at low risk for adverse cardiac outcomes. ||4. Do not treat gastroesophageal reflux in infants routinely with acid suppression therapy. |
|5. Do not perform repetitive CBC and chemistry testing in the face of clinical and lab stability. ||5. Do not use continuous pulse oximetry routinely in children with acute respiratory illness unless they are on supplemental oxygen. |
One strategy for encouraging and communicating appropriate care is to create a cognitive forcing function by explicitly documenting these types of decisions in daily progress notes. For example, hospitalists Drs Scott Flanders and Sanjay Saint recommend including the indication, day of administration, and expected duration of therapy for all antimicrobial therapies in all progress notes and sign-outs, as an approach for curbing inpatient antibiotic overuse. Likewise, hospitalists may eliminate use of routine labs, telemetry, continuous pulse oximetry, or other recurrent interventions or monitoring by documenting daily the patient needs and reasons for continued use or ordering.
Avoiding overuse is the simplest way to simultaneously enhance patient safety and decrease costs. Common areas of potential overuse in hospitalized patients include antibiotics, telemetry and monitoring, imaging, and routine labs.
THE IMPORTANCE OF CARE COORDINATION
The typical hospital patient is handed off from one physician to another more than 15 times during a single 5-day hospital stay, a rate that has been increasing with new duty hour restrictions and hospitalist staffing models. Not surprisingly, studies show the majority of hospital patients are unable to identify the clinician in charge of their care. Hospital physician discontinuity may lead to increased resource utilization and lower patient satisfaction. Coordinating structured handoffs between inpatient providers and with outpatient providers during transitions in care is critical to delivering high-value care.
Currently, about one-fifth of Medicare patients are readmitted within 30 days of hospitalization, and more than half of these patients do not see any outpatient health care provider between these visits. This population of frequently readmitted patients is particularly important for hospitalists. Some care coordination programs have been experimenting with the use of hospitalists that care for a subset of the highest risk patients both during hospitalization and following discharge, either in a high-risk clinic or at postacute care facilities such as skilled nursing facilities. These physicians are increasingly becoming known as “extensivists.” The early data on the cost-effectiveness of these types of programs have been mixed, but, much like ACOs, it may be too early to draw conclusions.
CONSIDERING PATIENT AFFORDABILITY
More Americans than ever before are on high-deductible insurance plans, making them responsible for an increasing share of health care costs. As “financial harms” for individual patients become increasingly recognized, and more patients forgo recommended medical treatments due to out-of-pocket costs, hospitalists must customize care plans to help patients afford their care.
Hospitalists may be able to improve their prescribing practices, particularly at the time of discharge. Nearly one-quarter of hospitalized adults in a survey reported cost-related underuse in the year prior to admission, and only 16% of patients knew how much their prescribed medications at discharge would cost them. Virtually nobody had spoken to their inpatient providers about the cost of the newly prescribed drugs.
Discussing drug costs with patients has been shown to be strongly associated with providing individualized lower-cost medication options. Health care professionals and patients can rely on an increasing number of freely available resources that provide price information and cheaper alternatives for most medications (Table 2-6). High-value prescribing has been defined as “providing the simplest medication regimen that minimizes physical and financial risk to the patient while achieving the best outcome.”
TABLE 2-6Some Resources That Provide Price Information for Medications ||Download (.pdf) TABLE 2-6 Some Resources That Provide Price Information for Medications
IMPLEMENTING VALUE-BASED INITIATIVES
Hospitalists across the country have largely taken the lead on designing value improvement pilots, programs, and groups within hospitals. Although value improvement projects may be built upon the established structures and techniques for quality improvement (see Section IV: Patient Safety and Quality Improvement, Chapter 21: Quality Improvement Methodologies), importantly these programs should include expertise in cost analyses. Furthermore, some traditional quality improvement programs have failed to result in actual cost savings; thus it is not enough to simply re-brand quality improvement with a banner of “value.” Value improvement efforts must overcome the cultural hurdle of “more care as better care,” as well as pay careful attention to the diplomacy required with value improvement since reducing costs may result in decreased revenue for certain departments or even decreases in individuals’ wages.
The national nonprofit group Costs of Care has proposed a “COST” framework to guide value improvement project design. COST stands for culture, oversight accountability, system support, and training. This approach leverages principles from implementation science to ensure that value improvement projects successfully provide multipronged tactics for overcoming the many barriers to high-value care delivery.
Hospitalists are uniquely positioned to identify potentially wasteful or inefficient practices within medical centers and to lead value improvement initiatives. Value improvement work requires the inclusion of expertise in health care cost accounting, as well as thoughtful diplomacy, and the design of multipronged efforts that explicitly target culture, oversight, systems, and training (COST).
APPLYING LEAN AND REDESIGNING CARE PATHWAYS
On a health system level, methods for ensuring better value may focus on techniques to improve efficiency and decrease “defects.” To achieve this goal, an increasing number of hospitals are now adopting lean methodologies and systems. Lean principles stem from the Toyota Production System developed by the automaker in Japan to focus on improving quality while reducing waste. In 2002, Virginia Mason Medical Center in Seattle famously began applying to health care the five general principles of lean: (1) define value from the customer’s perspective, (2) identify the value stream and remove any waste, (3) make value flow without interruption, (4) help customers pull value, and (5) pursue perfection.
Some lean tools have quickly been adapted to health care, including value stream maps that depict all of the individual steps in a process from beginning to end, and provides a graphical tool for identifying any non–value-added steps, delays, waiting times, and inefficiencies, as well as the commitment to rapid improvement cycles that are built around “small tests of change.” Lean programs have led to remarkable improvements in hospital processes and outcomes across the country from safety net hospitals like Denver Health to Veteran’s Affairs hospitals to the University of Michigan.
Similar in concept to lean are efforts to design and hone specific care pathways for certain patients and conditions. For example, many joint-replacement programs have created care pathways that standardize when patients will have catheters removed, mobilize with physical therapy, and be discharged to a specific disposition. Hospitalists are increasingly creating similar models for patients with pneumonia, chronic obstructive pulmonary disease (COPD) exacerbations, syncope, or other common clinical conditions. Intermountain Healthcare in Utah has applied evidence-based protocols to more than 60 clinical processes, re-engineering roughly 80% of all care that they deliver. Cincinnati Children’s Hospital partnered with local physicians to create large-scale improvements in the care of children with asthma, resulting in 92% adherence to best practices for asthma care, which has yielded many avoided hospital admissions and emergency department visits. These types of care redesigns and standardization promise to provide better, more efficient, and often safer care for more patients.
Hospitalists are now faced with the massive responsibility of providing better health care value. Based on the history of the hospitalist movement, we are up to the task. Value is defined as providing the highest quality care at lower costs, and should include components of patient outcomes, safety, and experience. To achieve this goal, measuring and understanding metrics related to quality and costs will be vitally important. There is an inexorable trend toward greater transparency in health care and it is likely soon that true health care costs will be publicly accessible across the country. Evidence is mounting that providing some cost information at the point-of-care may help support behavior changes and decrease unnecessarily expensive test ordering.
The most potent strategy for simultaneously improving care and decreasing costs is to reduce waste and overuse, which accounts for more than $200 billion in health care costs annually in the United States and causes significant patient harms. There are many common areas of overuse in hospital care, including the use of antibiotics, telemetry monitoring, transfusions, imaging, catheter usage, and routine lab draws. Many of these are highlighted in Choosing Wisely lists and other emerging appropriateness criteria.
Hospitalists can deliver high-value care to their patients by specifically considering appropriateness of care, care coordination, patient affordability, and value-based initiatives and care pathways.
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