Value Based Purchasing Newsletter Article Part II

                           Better Care.  Smarter Spending.  Healthier People.

Paying for Value – Not Volume!

Whether you are a patient, a provider, a health plan or a taxpayer it is in our common interest to build a healthcare delivery system that is better, smarter and healthier – a system that delivers better care; a system that spends healthcare dollars more wisely; and a system that makes our communities healthier!  We must develop and implement better ways as a country to deliver care, pay providers and distribute information.

Improving the quality and affordability of care for all Americans has always been a pillar of the Affordable Care Act, alongside expanding access to such care.  The ACA provides an opportunity to shape healthcare delivery, improve the quality of care provided and reduce overall growth of healthcare costs.  Value and care-coordination will now be rewarded, rather than volume and care duplication.  The Department of Health and Human Services has established and communicated the benchmarks and metrics that will be used for accountability and drive the attainment of goals for Value Based Purchasing.

There are actually four categories that currently outline this new structure for payments to providers:

1.     Category One – fee-for-service with NO link of payment to quality.

2.     Category Two – fee-for-service with a link of payment to quality.

3.     Category Three – alternative payment models built on fee-for-service architecture.

4.     Category Four – population-based payment.

Value-based purchasing includes payments made in categories 2 thru 4, with the goal of moving the majority of encounters to the population-based payment group.  The goal is to increase accountability for both quality and total cost of the care provided.  At the end of 2014, an estimated 20 percent of Medicare reimbursements had shifted to categories 3 and 4. 

The Department of Health and Human Services has set a goal that by the end of 2016, 30 percent of all Medicare payments will be in categories 3 and 4, and that goal increases to 50 percent by the end of 2018.  Part of this will be accomplished by utilization of alternative payments models such as the medical home, bundling payments and utilization of Accountable Care Organizations. Ultimately the goal is that by the end of 2018, 90 percent of Medicare fee-for-service payments will be in categories 2 thru 4.  In these alternative payment models, providers are accountable for the quality and cost of care for the people and populations they serve moving away from the old way of doing things which amounted to “the more you do, the more you get paid”.

Let’s expand a bit on one of the alternative models.  In the Patient Centered Medical Home model, instead of physicians working in silos, separately, care coordinators oversee all the care a patient is getting.  This means patients are more likely to get the right tests and medications rather than getting duplicated tests, procedures, etc.  These medical homes typically offer patients access to a physician or other clinicians 24/7, and some may offer extended office hours.

According to the Secretary of the Department of Health and Human Services in a statement earlier this year, she stated the progress made thus far has saved taxpayers more than $116 billion. This savings translates in the ability of organizations to reduce expenditures and reinvest those dollars in higher quality care for their employees – wellness programs, for example.

America’s healthcare system is poised to move into its next phase – a coordinated, cost-efficient and quality driven system that promotes and supports individuals and community health.

New drivers have been implemented to foster these changes and next month we will share information on The Center for Medicare and Medicaid Innovation, Transforming Clinical Practices Initiative and the National Quality Strategy. 

Putting all the Pieces Together

It is our strong recommendation that organizations do not make changes to their quality management systems until the formal standard is released in 2015.

I love jigsaw puzzles.  Almost every vacation my family takes includes a brand new puzzle, which my family and I will spend the quiet moments assembling.  I have a confession to make; I steal the last piece long before the puzzle is ever done.  There is just something about bringing all the pieces together, that in and of themselves’ has no true image or meaning, but when combined make a beautiful picture.  The reality is that each of my children and my wife contribute to the masterpiece just as much as I, but as the family’s “TOP MANAGEMENT” person I get to put in the last piece. It probably wouldn’t surprise anyone that my children have begun to replicate the process of stealing a piece, so at the end there are six pieces missing and a battle ensues for the placement of that final piece.

In section 7 “Support” of the ISO 9001:2015 standard we see the same puzzle coming together to help present the organization in its best light.  The good news is that, as far as significant changes in implementation, there are few.  Infrastructure and Work Environment remain virtually unchanged.  If you are an ISO geek like me, you may have noticed the note in 7.1.4 that Environment can include physical, social, psychological, environmental and other factor.  Don’t get too excited about trying to maintain and control social and psychological factors at this point.  They tried to put this same language into the 2000 revision of the ISO standard, but it never made the cut.  I suspect that it will quickly disappear in this version as well.  

Calibration remains primarily the same with the exception of the defining characteristics of when an organization implements full and traceable calibration.  In the 2008 standard the deciding factor is, “Where necessary to ensure valid results…..” in the 2015 standard the factor is, “Where measurement traceability is: a statutory, regulatory, customer, interested party, or organizational requirement.”

Training and competency remains the same, although the 2015 standard has extended the language.  The new standard incorporates items such as the quality policy, relevant objects, etc., into this section called Organizational knowledge, Competence and Awareness.  

The very end of section 7 is where one would find the most significant change to the standard.  Document Control and Record Control no longer exist as two separate requirements, but have been combined into what the standard is calling “Documented Information”.  Don’t let this throw you off.  Here are a few clarifying notes, “a peak at the puzzle box” to help you put it all together.

1.      There are only two statements directing the organization as to what documented information needs to be controlled.  (ISO required & Organization Required)

2.      There is no formal requirement for a Quality Manual or the ISO 9001:2008 six required procedures.

3.      The only definitive (called out by name) requirement is for a Quality Policy and Quality Objectives.

4.      The term “documented information” has replaced “documented procedure” as the identifier as to when the requirements for the control of documents and records is to be implemented.

5.      All the requirements in section 7.5 “Documented Information” can be applied to either a Document or a Record, however, as you are reading this section you will see that section 7.5.1,2,&3 most closely resembles the old document control and section 7.5.3.2 most closely resembles the old record control.

As you read through the new standard and begin to turn the pieces over from the blank side to the picture side, I am confident that you will breathe a sigh of relief. Before your eyes the puzzle will begin to show a picture that the intent of the standard has not really changed much.  The box of pieces has been shuffled, but the picture on the box remains the same. 

What we must keep in mind is that there is just something about bringing all the pieces together, that in and of themselves’ has no true image or meaning, but when combined in the right place, makes a beautiful picture. Each member of your team will contribute and hopefully you will not have any “piece thieves” along the way. This puzzle will require all members of the “family” to work together in contributing to the final piece of the puzzle placement! 

Last Piece Thief

Woody

SO NOW THAT YOU FINALLY UNDERSTAND THE 9001:2008 STANDARD…“WHY CHANGE EVERYTHING?”

It is our strong recommendation that organizations do not make changes to their quality management systems until the formal standard is released in 2015.

“Just when you thought it was safe to go back into the water…”  It wouldn’t surprise me that many of you are feeling this way as the new ISO 9001:2015 standard looms on the not so distant horizon. 

When you think about it, isn’t that what ISO has been preaching for years, Continuous Improvement?  It is refreshing to know the International Organization for Standardization practices what they preach.

When people ask my goal as a consultant, teacher and auditor, I reply that my job is to ensure the organization sees Return on Investment, Litigation Security and most importantly, Patient Safety or Customer Satisfaction.  When you look at the new standard you can’t help but notice the heightened awareness to RISK.  Risk that an organization might face can come in the form of a thousand different possibilities like little piranhas that can swiftly eat away at the success of an organization or it can come in the form of a great white shark that can immediately devastate an organization. 

What the new standard is attempting to accomplish is to set up a series of life guard stands for an organization whereby the threat can be identified far off in the distance before it can do any real harm.  In section 4 of the ISO 9001:2015 standard the organization is asked to take a good hard look at itself, its customer and any other interested parties that play a relevant role in the success of the organization.

           

                                                 

As the organization begins to evaluate their context, “the pool of water that they are swimming in” they very quickly discover that they themselves may be the cause of some of their greatest risks.  Maybe due to resource constraints, equipment constraints, facility constraints, etc., they may have reached their capacity to fulfill customer needs.  The ISO standard simply asks us to identify and then, in a controlled fashion, mitigate those risks.  Maybe we take swimming lessons and develop a stronger stroke so that we can stay ahead of the competition.

In our current culture customers demand higher levels of quality without additional expense. As an organization clearly identifies these needs and expectations, the risk to the organization will be revealed.

If we identify what it is that our customers truly want and expect, we can now begin to address these issues, not only for the good of the customer, but also for the financial strength of the organization. An organization can maintain cost and see a nice profit, if they change their culture.  To begin to change this culture, an organization needs to improve processes and build quality into the process, instead of inspecting it into their processes. They must work to reduce the number of process failures to consistently and reliably reproduce the product. By doing this, we can feed the sharks what they want instead of letting them eat away at our success.

“Interested party” is the name the ISO standard has given to all others who hold a relevant role in the success of an organization.  This category can be large; however they are not very difficult to manage.  Regulatory bodies want their codes to be complied with; investors want their money; suppliers want their invoices paid.  The smart organization will identify, assess and mitigate the threat that each interested party plays in their success.  If my supplier, my “swim coach”, isn’t helping me stay ahead of the competition, I have to get a new swim coach/supplier.  If I ignore the “Do not swim in shark infested waters” sign I may need to get a bigger sign or put up larger barricades.  Identifying risk from interested parties can keep our organization healthy and safe.

When you believe in your organization strongly enough you will see that Identifying, Assessing and Mitigating the RISKS to your organization is something that you will grow to appreciate.

See You in 2015 and enjoy your safe swim.