Hospital Value-based Purchasing program 1% incentive is like homeopathic medicine — too diluted to actually work

In the June 15, 2017 issue of the New England Journal of Medicine, Andrew Ryan and colleagues from the University of Michigan published an evaluation of the Medicare Hospital Value-Based Purchasing Program (HVBP).

To summarize, if you offer a 1% incentive, and then dilute it by offering it only for the 40% of hospital patients covered by Medicare, and then dilute it further by spreading it across three domains (clinical process quality, patient experience and mortality), and then dilute each of these by basing them on multiple component metrics, and then dilute it more by choosing metrics that have already been reported for a number of years (and therefore the “low hanging fruit” improvement opportunities may already have been picked), and then further dilute it by offering the incentive mixed in with many other incentives for such things as meaningful use of EMRs…..

Wait for it….
You don’t see impact, even after 4 years.
The thinking behind HVBP is like homeopathy, where the practitioners assert that the more they dilute the homeopathic remedy ingredient, the more powerful the remedy becomes.
Imagine if a company hired a CEO and wanted to incentivize her to achieve growth and profitability. Would they consider a 1% incentive to be meaningful (even without further dilution).  No, the board would choose a number 50 to 75 times higher.
How about an equipment manufacturer choosing an incentive percentage for its sales team?  One percent sound like enough?
I’ve been exasperated for years that our value-based reimbursement designs – for both government and commercial payers – include an incentive that is far too small to motivate the types of changes they are intended to cause.  I fear we are just setting ourselves up for eventually someone saying “well, we tried incentives, and they don’t work.”
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Simon Sinek’s TED talk: Change minds by starting with why, not what

Improving health care requires convincing people to make changes. Changing a care process begins with changing the minds of the people involved in that process.

But, how can we change people’s minds?

I am a person who loves logic and numbers. Therefore, my tendency is to assume that the best way to convince people to make improvements to care processes is to clearly explain the logic supporting the change and to use rigorous, transparent and evidence-based quantitative projections of the outcomes that can be achieved by making the improvements.

But, experience teaches that solid logic and analysis does not always compel action. Often, it fails even to capture attention.

In the blog of Kevin Fickenscher, the incoming CEO of the American Medical Informatics Association, he included a link to an excellent TED talk by Simon Sinek, the author of the book “Start With Why.”  Sinek argues that ineffective people first explain what they are proposing, then they explain how it can be done, and finally they explain why the change should be made.  Sinek explains that effective people structure their communications in the exact opposite order.  They first explain the why — their consistent mission or objective.  Then, they explain how they carry out that mission.  Finally, they explain what is a specific example that people can select if they identify with that mission.  Sinek believes that people will decide to “buy” a particular change if they see it as a way to define themselves as someone who is part of a compelling, attractive mission.  That last point is totally consistent with my experience: if you hire people who are mission-driven and you allow them to focus their professional attention on that mission, they will be far more productive and effective.  And, they will inspire others to do the same.

Sinek is a talented lecturer, as are almost all the people invited to give TED talks.  Although he sometimes seems a bit too sure of himself for a topic as subjective as human behavior, he nevertheless provides excellent food for thought for mission-driven people involved in health care improvement.

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Primary care physicians acknowledge over-utilization and blame it on the lawyers.

Catching up on some reading, I came across this article in Medical News Today, describing the results of survey research conducted by Brenda E. Sirovich, MD, MS, and colleagues from the VA Outcomes Group (White River Junction, Vermont), and the Dartmouth Institute for Health Policy and Clinical Practice.   They surveyed primary care physicians and published their results in the Archives of internal Medicine.  They documented that primary care physicians acknowledge over-utilizationof services received by their patients.

Their #1 theory of causation?  “It’s because of malpractice lawyers!” That is not surprising to me, and is consistent with many conversations with both front line PCPs and leaders of primary care physician organizations.

However, I personally believe that this is really the #1 rationalization of the over-utilization.  I feel that there are two main causes:

  1. Low fee-for-service reimbursement, creating the need for many short visits each day to generate enough revenue to make a good living (i.e. the “hamster wheel”).  When visits need to be short, prescriptions and referrals are important to make the patient feel satisfied that their problem is really being addressed.
  2. Lack of effective clinical leadership or even peer interaction over the actual clinical decision-making (i.e. “care-planning”) done on a day-to-day basis by the vast majority of primary care physicians

Beyond the medical school and residency stage, physicians’ care planning occurs all alone, with no-one looking over their shoulder — at least no one with sufficient quantity and quality of information to make any real assessment of clinical decision-making.  Health plans have tried to do so with utilization management programs, but the poor quality of information and the relationship distance between the physician and the health plan are too great to generate much more than antipathy.

If you eliminated malpractice worries and paid primary care physicians a monthly per-capita fixed fee, would wasteful over-utilization go down without also providing deeper clinical leadership and peer review enabled by better care planning data?  Perhaps.  But I would worry that, in that scenario, physicians would still stick with their old habits of hitting the order & referral button out of habit to please the patients who have been habituated to think of “lots of orders and referrals” as good primary care.

The “mindfulness” thing in the invited commentary by Calvin Chou, MD, PhD, from the University of California, San Francisco, is a bit much — trying too hard to coin a term.  I’ve heard that presented before, and I categorized it with “stages of change,” “empowerment,” “self-actualization,” “motivational interviewing,” and “patient activation.”   I’m not saying that such popular psychological/sociological concepts have no merit.  I’m just a Mid-Westerner who starts with more conventional theories of behavior.

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Google engineering too slow? Facebook too invested in the wrong data model to adapt? Are you kidding me?

Few things in my work life are better than finding mind-blowing information from other industries and figuring out the implications for healthcare.

I recently read a set of slides by Paul Adams, a user experience designer that worked at Google and Facebook.  Although Adams’ presentation had 224 slides, the main thesis was relatively simple and obvious. The best insights usually are. Adams pointed out that online social media applications create a single category of relationships, called “friends.” They put every social relationship in that one bucket.  Wife, college sweetheart, boss, party friends, kids …  all just “friends.”  In contrast, real-world social networks — the kind that humans have cultivated for millions of years — are characterized by various groupings of people representing different roles, life-stages and social contexts, with different levels of strength and trust.

Diagram from Paul Adams' presentation on Real World Social Networks

He described the research that shows that people typically have 4-6 different groupings of friends.  People typically have fewer than 10 strong ties that consume most of their communication attention.  They typically don’t have more than 150 weak ties.  They have many “temporary ties” that may influence their behaviors for relatively short periods of time.  He points out that existing social media applications create problems for their users because the users publish information intended for one group of people that ends up being received by others.  Like wild party pictures being viewed by your prospective employer.

I came across Adams’ presentation through a link from a CNN article by Dhanji Prasanna that tells the story of how Adams developed these ideas when he was part of a team at Google that was developing Google’s response to Facebook.  The CNN article explains that Google had an engineering culture and a technology infrastructure that made them too slow to develop an application that took Adams’ insights to heart.  Adams then left Google to join Facebook.  But, Facebook was deeply invested in the simplified one-big-bucket social graph at the heart of the system that now has 750 million users.  So, despite Facebook’s “hacker” engineering culture that allows it to develop applications rapidly, they were unable to solve their fundamental problem.  They eventually launched Facebook Groups, which is a superficial answer to the insight that people have multiple groups of relationships.  But, Facebook’s central “one-big-bucket” friends model was apparently deemed too risky to touch.

My eyes rolled.  Google’s culture makes them too slow?  Facebook can’t innovate?  Are you kidding me?  If only we could experience a tenth of the agility shown by those two companies in health care, which has long suffered from a powerful aversion to risk and change in both care delivery and information technology.

But, there are deeper connections between Adams’ insights about social networks and our challenges in transforming our health care system.

First, the health behaviors of patients are strongly influenced by their social networks. For years, health care providers, health plans and vendors of wellness and care management services have attempted to promote smoking cessation, exercise, healthy diet, compliance with medication orders, and other health and lifestyle behaviors by designing “interventions” that target individual patients.  A whole industry of “health risk assessment” and “predictive modeling” was built up to try to identify which individual patients to target.  But, such an approach has produced unimpressive results.  That should not have been surprising.  Decades old research about the diffusion of innovations has shown that lifestyle behaviors in a population change through social networks.  People follow the lead of the people around them.  Therefore, to be effective, wellness and care management programs need to be designed to work through those existing social networks.  We need to be targeting groups of people that are already connected, rather than just reaching out to individuals.  We need to be designing our communications and incentive approaches so as to augment and leverage our patients’ social networks.  To support such social-network-oriented clinical programs, we need information systems that capture information about those social networks and that are designed to interact with them.   But, when we examine the fundamental data model and features of the market-leading electronic health record (EHR) systems, such capabilities are nowhere to be found.  Those vendors, blessed with a large installed base, may be unable to make such fundamental changes to their systems.  Like Google and Facebook, the leading  EHR vendors may not be agile enough to address our emerging understanding of the importance of social networks that exist among our patients.

Second, the relationships between patients and care providers are types of social network relationships.  I call these care relationships.  When we talk about “accountable care,” we mean that some provider organization is taking responsibility for the quality and cost of care for a population of patients. When we talk about a “patient-centered medical home,” we mean a team of primary care physicians, nurses and other care providers proactively taking care of a group of patients. But, who exactly are those patients? We have developed some very crude primary care “attribution” logic that tries to derive care relationships from claims data.  But, we do a very poor job of validating such derived care relationships or proactively declaring new care relationships.  And we don’t keep track of changes in care relationships.  We don’t have established processes to inform the participants in those relationships when one of the parties determines that they don’t intend for the relationship to exist.  We don’t distinguish between different types of care relationships.  If a patient has heart failure and sees both a primary care physician and a cardiologist, we don’t explicitly declare which physician has the care responsibility for that patient problem.

Furthermore, the referral relationships among providers are also types of social network relationships.  As with Adams’ real-world social networks, these relationships among patients, primary care doctors, specialists, hospitals, home health care nurses, pharmacists, and others are complex and dynamic.   Yet, when you examine the systems we use to keep track of these relationships, they are primitive or non-existent.  Just as over-simplification of social network relationships has reeked havoc for social media users, so has over-simplification of care relationships, care responsibilities and referral relationships harmed clinical communications and accountabilities.  This deficiency ultimately reduces the effectiveness of care. As a result, patients are harmed.

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How does behavioral economics and “gamification” relate to ACOs?

The transformation of our health care system requires many different people to change their behaviors. Leaders of health care organizations have to be willing to make investments that they have historically not been willing to make. Physicians have to change the way they relate to patients, the way they interact with their non-physician team members in the clinic, the way they allocate their time during clinic visits, the orders they write, and the referral patterns they have established. Patients may have to change their care relationships with providers, and change their tendency to be passive regarding health care decisions. Most importantly, and most difficult of all, patients have to change their lifestyle and self-management behaviors.

In my experience, the leaders of health care organizations and health plans tend to be unsophisticated in their approach to affecting the behaviors of front line providers. And health care providers — particularly doctors and nurses — tend to be unsophisticated in their approach to changing the behaviors of their patients. In both cases, the unsophisticated approach relies too heavily on two things: (1) education (communicating facts) and (2) communicating negative consequences of failure to change behavior.

Furthermore, in the case of affecting provider behavior, a huge amount of attention has been paid recently to the economic incentives intrinsic to fee-for-service vs. bundled payment reimbursement models. The federal government, as well as many commercial payers, have implemented “pay for performance” or “gain sharing” programs that offer relatively small financial rewards in the relatively distant future with a relatively high degree of uncertainty. Such incentives are designed with zero data about the probability that particular behaviors are going to change in response to such incentives. The government and commercial payers just know that they should begin to initiative financial incentives. And they know that for economic and political reasons, they can’t afford for those incentives to be very large. But, paying a financial incentive that is too small to “buy” the desired behavior change is pure waste. It’s just symbolic, not transformative.

To be successful, leaders of ACOs need to raise their game in behavioral economics, following the lead of many other industries that have been studying and putting into practice effective techniques for behavior change. In the electronic world, millions of people play video and computer games, and millions interact with commercial web sites that have been “gamified” — incorporating point sytems, competition, virtual rewards, and other techniques shown to modify behavior without relying on financial incentives. In the health care field, health plans have been at the forefront of exploring the application of such techniques to health and wellness. But, these applications have not yet been shown in well-designed studies to have a significant impact on health outcomes and health care costs (notwithstanding a slew of poorly-designed studies showing miraculous results).

The following video is a lecture delivered at Stanford by Rajat Paharia, the founder and Chief Product Officer of Bunchball – a developer of a technology platform that supports the incorporation of “game mechanics” into commercial web sites. Rajat’s lecture is entitled “Driving User Behavior with Game Dynamics and Behavioral Economics” and was delivered February 19, 2010. The video is an hour long. But, I recommend it for clinical program designers in ACOs, physician organizations and health plans as a clear, accessible summary of the behavioral economics evidence base and the current real-world commercial applications of that body of knowledge.

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