Chapter 7 Developing a Medicare Quality The research issues reviewed in the previous chapter are but one aspect of a long-term strategy to advance the state of the art in quality assurance. As noted in chapters 4, 5, and 6, current information and methods are inadequate to address the questions and tasks that the Congress has already posed. For example, although PRO review responsibilities are scheduled to expand to nonacute care settings, adequate methods to perform those reviews do not currently exist and the research underway may not fill the gaps quickly enough. Similarly, existing information cannot characterize current levels of quality in a manner responsive to congressional interests. Beyond this, sound program management requires anticipating future instances in which information pertaining to quality will be required (perhaps in conjunction with proposed changes in the Medicare program) and creating a capacity to respond to those situations as they arise. Developing a long-term strategy for quality assurance to meet currently known and future needs would require thinking through two sets of activities. The first pertains to basic methods development and includes advancing the knowledge base regarding (1) the specification of good clinical practice, (2) the incorporation of that practice into standards and quality assurance methods, and (3) the evaluation of incentives for practitioners to adopt such practice standards. These activities are essential to furthering quality assurance generally and are relevant to the Medicare program as well as to other public and private health care programs. The second set of activities is specific to the Medicare program and includes (1) incorporating advances in the knowledge base into Medicare quality assurance efforts, and (2) monitoring their effectiveness. As discussed below, these two sets of activities require different perspectives, resources, knowledge, and skills. They do not necessarily need to be performed by the same organization, but should certainly be coordinated. In this chapter, we review the requirements for accomplishing the activities described above, discuss organizational entities inside and outside the federal government engaged in relevant research, and delineate some pros and cons of alternative organizational configurations and funding sources. Developing a Medicare Quality Prerequisites for a Research and Development Incorporating Advances The current array of quality assurance methods reflects years of devel- Adapting the findings of quality assurance research so that they can be implemented appropriately in the Medicare program also requires research and analytic skills, but of a different nature than those involved in conducting the initial research. Persons performing the translation function must understand the strengths and limitations of the methods and findings of the initial research, as well as the structure and operations of the Medicare program. Tailoring research findings to meet Medicare programmatic needs may require some modification and further testing before they are integrated into ongoing quality review activities. Evaluating the effects of quality assessment efforts, as well as levels of quality attained, again requires research and operational expertise, but also an objectivity that allows separating empirical evidence of success or failure from a desire to see the program work effectively. Finally, it may be necessary to develop better institutional Developing a Medicare Quality Organizations HHS Quality of Care Health Care Financing mechanisms to balance the need to curtail Medicare coverage and utilization for cost control reasons against quality assurance findings that may indicate the need for increased expenditures in certain areas. Certain components of quality of care research activities are currently performed by a variety of federal and private organizations. At the federal level, both executive branch and congressional agencies are involved. In the discussion below, we outline the relevant research activities and responsibilities of these organizations. Developing a comprehensive quality assurance system to support the Medicare program will require consideration of the unique attributes of these organizations and the activities that each can best perform, specification of responsibilities and accountability, and the development of formal coordination mechanisms. We discuss organizational alternatives, but because of the complex trade-offs involved, we do not recommend a specific configuration. Most Medicare-relevant quality of care and quality-related studies in the Within HCFA, the Office of Research and Demonstrations (ORD) supports over 200 research, evaluation, and demonstration projects that focus on health care expenditures, reimbursement, coverage, eligibility, and management alternatives under Medicare and Medicaid. Studies also examine program effects on beneficiary health status, access to services, utilization, and out-of-pocket expenditures, as well as the behavior and economics of health care providers and the overall health care industry. Within ORD, these activities are carried out by the Office of Research, which supports data collection efforts and research on the above topics, and the Office of Demonstrations and Evaluation, which manages pilot programs and experiments that test new ways of delivering and financing Medicare and Medicaid services. Developing a Medicare Quality As of July 1987, ORD had a total of 174 staff (141 professionals) and an extramural research and demonstrations budget of $28 million. The Director is a career Senior Executive Service appointee. Applications for grants and cooperative agreements are reviewed for technical merit by specially created review groups of both nonfederal experts and HHS staff. They are not formally constituted review panels in the NIH/NCHSR tradition (see below). Rather, they are newly formed for each review cycle, and ORD staff rotate the responsibility for chairing the groups, although an attempt is made to achieve some continuity in review groups' membership over time. Contract proposals are reviewed according to the usual government procurement process. The criteria for funding new projects include consideration of the scores and recommendations of the technical review panels, but HCFA research and policy priorities are also taken into consideration. The Administrator of HCFA can consider all grant applications for funding, and not just those judged as technically acceptable and rated highly by the review panels. The policy relevance of the proposed studies, as judged by HCFA senior staff, and the availability of resources, therefore, play a role in funding decisions.1 While some studies funded by ORD are primarily designed to assess or develop methods to measure quality of care, most studies develop information the Medicare program needs to refine DRGS and extend prospective payment methods to other services. In some cases, these studies are designed to respond to specific congressional mandates. For example, The Omnibus Budget Reconciliation Act of 1986 mandated that HCFA examine alternative approaches to developing severity adjustments and make recommendations for refining the DRG payment methodology to better reflect differences in case severity. Other studies, such as the comparison of cost and quality of nursing home care in hospital-based and free-standing facilities, will provide information needed to develop appropriate methods of paying for these services prospectively. Developmental work on the assessment of quality of care has also been conducted within ORD as part of the evaluation of demonstration projects, such as the assessment of Medicare HMOS operating under waivers. As discussed in appendix VI, HCFA's congressionally mandated 1A discussion of ORD's proposal review and the funding process is presented in J. Hawes, “The Management of Demonstration Programs in the Office of Research and Demonstrations, Health Care Financing Administration," in T. Glennan, et al., Case Studies of the Management of Demonstration Programs in the Department of Health and Human Services (Santa Monica, Calif.: The Rand Corporation, May 1986), pp. 43-6. These issues are also being examined by GAO. Developing a Medicare Quality The National Center for Health assessment of the impact of the prospective payment system includes a large-scale study of both health care outcomes based on administrative data and of the process and outcomes of care through focused medical record reviews for selected medical conditions. These studies have involved extensive measurement and methods development. ORD has not, however, become extensively involved in the evaluation of quality assessment methods employed in the PRO program, nor in the analysis of quality-related data generated by the PROS. ORD and the Health Standards and Quality Bureau (HSQB), which oversees the PRO program, have jointly funded a study to generate severity indicators from clinical information on patient medical records. Otherwise, quality of care research conducted in ORD and the oversight of quality review activities performed in HSQB (for PROS and SuperPRO) and in the Bureau of Program Operations (for carriers and intermediaries) are essentially independent operations.2 The HSQB outcomes analyses that help target PRO review activities are being developed with only loosely structured coordination with ORD, which is conducting its own studies of outcomes. HCFA has convened meetings of experts on outcomes analysis, and there are informal contacts between HSQB and ORD researchers. We are not aware, however, of any formal system or structured research agenda within HCFA to evaluate and compare the various quality assurance methods used in HCFA programs along the lines suggested in previous chapters. Created in 1968, NCHSR&HCTA is the federal government's only generalpurpose health services research agency. Located within the Public Health Service, its mission is not directly linked to the programmatic needs of any federal health care delivery or financing program. The Center's general legislative authority states that to the extent possible, the Secretary shall rely on the Center to coordinate all health services research, evaluation, and demonstration supported through HHS. In addition to studies in the areas of health manpower and health facilities, the Center may undertake and support projects related to the accessibility, acceptability, planning, organization, distribution, technology, utilization, quality, and financing of health services and health systems. In 1982, some responsibilities of the former National Center for Health 2Given their program integrity purpose, the studies of quality of care conducted by the HHS Office of the Inspector General are also independent of ongoing ORD research efforts. |