Quality: Promoting Performance or Process?

Last week’s reform summit focused the political spotlight on existing proposals for solving problems of access (i.e., availability, affordability, and coverage of insurance). Lesser discussions of cost and quality were also restatements of previously stated positions. The meeting of the parties was civil, but it was not a meeting of the minds.

If even one participant responded to the President’s request for new ideas—a precondition for progress, in my opinion—I missed it. Consequently, to complement last week’s new idea for getting expenditures under control by fixing medical spending at 17% of GDP (see 2/22 post), here is a new idea for improving quality: let’s replace pay-for-performance with pay-for-process.
Pay-for-performance (P4P) has caused many providers to improve care, but it has not eliminated bad care. Meeting an 80% performance standard, a common threshold for P4P quality indicators, is an improvement for many providers. However, 80% falls far short of doing the right thing all the time. I’d like to think that 100% appropriate performance is possible in a country that spends 17% of GDP on health care.

Pay-for-performance is viewed cynically by providers. It is frequently called pay-for-reporting because collecting the numbers presumably gets more attention than improving the care. Recent analysis even suggests that costs of reporting may exceed the financial rewards, reinforcing the cynicism. P4P is also compared to the equivalent reform in K-12 education, No Child Left Behind, where teaching students how to take the assessment test has become more important than teaching them how to learn.

Rewarding, even requiring, an operational performance improvement process (PIP) deserves serious consideration as a better approach to ensuring top-quality care. Assuming Americans don’t want anything less, I seriously suggest that health reform replace selective P4P with PIP encompassing the delivery of all care. Reimbursement and regulations should give providers a strong incentive to use data-driven, standards-based processes (e.g., ISO 9001, lean management, Six-Sigma, TQM/CQI) that identify unexplained variations and immediately initiate actions to prevent problems from happening again.

A comparison of performance-based and process-driven approaches helps make the case for shifting reform’s focus from meeting minimum standards to optimizing all care. Under P4P, hospitals receive extra payment for being able to document that aspirin was given to 80% of all heart attack patients within a specified period of time. Under PIP, hospitals would only be rewarded when every heart attack patient was evaluated and treated according to a protocol on the appropriate use of aspirin.

This new idea puts even more urgency on adoption of information technology and casts a different light on the emerging definition of meaningful use. But quality is #1, isn’t it? What do you want to reward—P4P or PIP?