Performance Improvement 1999. Health Care Financing Administration



TITLE: Toward a Prospective Payment System for Outpatient Services: Implementation for Outpatient Services: Implementation of APGs by State Medicaid Agencies and Private Payers

ABSTRACT: The Balanced budget Act of 1997 mandated that Medicare begin implementing a prospective payment system for hospital outpatient services that incorporates a service classification system, such as ambulatory patient groups (APGs). Since 1990, eleven payers -five Medicaid programs and six private insurers-have designed payment systems based on APGs, and six of the eleven have implemented APG-based payment systems. The evaluator looked at the six operational APG systems to determine the effect of the systems on expenditures. The purpose of the evaluation was to determine the effect of the system on reducing outpatient costs and whether the system was easy to implement and use. Overall, the evaluator found that the six payers with APG operational experience implemented the system without major incident. They also reported success in reducing outpatient cost, where that was the immediate goal, and they believe the system encourages higher-cost facilities to reduce costs and rewards lower-cost facilities for their efficiency. Providers views were mixed. They view the system as complex. They generally cannot calculate expected payments under APGs and often let payers compute systems group-related claims rather than consolidating them prior to submission as was the intent of the system.

AGENCY SPONSOR: Center for Health Plans and Providers


PHONE NUMBER: 410-786-6676

PIC ID: 6320

PERFORMER ORGANIZATION: Mathematica Policy Research, Inc., Plainsboro, NJ


TITLE: Evaluation of the Demonstration to Improve Access to Care for Pregnant Substance Abusers

ABSTRACT: This evaluation looked at the effectiveness of demonstrations in five States to improve access to prenatal care and treatment services for substance abusing women. Examined were: (1) outreach and assessment services; (2) services expansion, integration and coordination; and (3) improvement of client case management. The effects of these services on the health of drug-addicted pregnant women and birth outcomes of their infants were measured. One limitation of the study was the relatively low number of abusers enrolled in the demonstrations because pregnant substance abusers in the five demonstration sites were reluctant to be identified. Higher enrollment rates were found in those sites which implemented broad-based outreach efforts. Those sites recorded higher levels of and greater retention in substance abuse treatment. The outcome analysis showed that demonstration clients compared to other pregnant substance abusers in the site area had better results in higher birth weight infants, but the findings were inconclusive due to possible self-selection biases.

AGENCY SPONSOR: Center for Beneficiary Services

FEDERAL CONTACT: Suzanne Rotwein, Ph.D.

PHONE NUMBER: 410-786-6621

PIC ID: 6297

PERFORMER ORGANIZATION: Mathematica Policy Research, Inc., Washington, DC


TITLE: Evaluation of Drug Use Review Demonstration Projects Final Report

ABSTRACT: This project tested the effectiveness of prospective and retrospective drug use reviews (DURs) on pharmacist behavior and drug use and costs. Findings showed that prospective drug use reviews had no measurable effects on the frequency of drug problems or on utilization and expenditures on prescription drugs and other medical services. There were no behavioral changes in pharmacists who received online prospective drug use review messages. Instead, services most often provided by pharmacists involved counseling and educating patients rather than interactions with prescribers or other pharmacists.

AGENCY SPONSOR: Office of Strategic Planning


PHONE NUMBER: 410-786-6591

PIC ID: 6296

PERFORMER ORGANIZATION: Abt Associates, Inc., Cambridge MA


TITLE: The Evolution of the Oregon Health Plan: First Interim Report

ABSTRACT: The Oregon Health Plan (OHP) was implemented in February 1994, extending health insurance coverage (Medicaid eligibility) to uninsured State residents below poverty. The costs of expanded insurance coverage are financed through the use of a prioritized list of health care services (to determine the benefit package), increased enrollment in capitated managed care organizations (MCOs), as well as revenues generated by a cigarette tax earmarked for OHP. This interim evaluation assessed the implementation process and program impacts. Findings on the impact of OHP on providers showed that the priority list did not effect physician practice--care needed was obtained by exemptions from health plans or offering care for free; provider perception were that access and capacity had improved, especially for the expansion population; and problems occurred in the provision of after-hours care by hospital emergency medical care units. Regarding the impact on consumers, the study found that OHP positively influenced use of preventive care, but encountered problems in shifting pregnant women to managed care and the initiation of prenatal care.

AGENCY SPONSOR: Office of Strategic Planning


PHONE NUMBER: 410-786-6629

PIC ID: 6991

PERFORMER ORGANIZATION: Health Economics Research, Inc., Waltham MA


TITLE: Medicare Participating Heart Bypass Center Demonstration Extended Evaluation

ABSTRACT: The purpose of the negotiated bundled payment demonstration implemented in May 1991 by HCFA was to determine the cost benefits of a negotiated package pricing arrangement for heart bypass surgery. Hospitals and physicians received a global payment (covering hospital and related physician services, including outliers and re-admissions), for each Coronary Artery Bypass Graft procedure. The negotiated rate represented a discount from what Medicare paid, on average for these procedures. Over 10,000 procedures were performed under the demonstration with an estimated savings to the Medicare program of over $50 million. Findings suggest that both Medicare and hospitals can benefit from global payment arrangements through reduced costs, better coordination of services, and improved quality of care. The bundled payment arrangement provided incentives to facilitate more cooperative relationships between physicians and hospital staff leading to quality improvement activities which, in turn, resulted in more efficient patient care delivery and lower costs while maintaining high quality of patient care. The demonstration lead to innovative physician incentive programs to improve quality and reduce costs, a nationwide proliferation of private sector bundled payment arrangements based on the demonstration, proposed legislation to establish negotiated bundled payment arrangements under the regular Medicare program, and the design of a new bundled payment demonstration for orthopedic and cardiovascular services.

AGENCY SPONSOR: Office of Clinical Standards and Quality

FEDERAL CONTACT: Armen H. Thoumaian, Ph.D.

PHONE NUMBER: 410-786-6672

PIC ID: 5958.5

PERFORMER ORGANIZATION: Health Economics Research, Inc., Waltham MA

TITLE: Evaluation and Technical Assistance of the Medicare Alzheimer's Disease Demonstration

ABSTRACT: The purpose of the Medicare Alzheimer's Disease Demonstration was to determine the effectiveness, cost, and impact on health status and functioning of providing comprehensive in-home and community-based services to beneficiaries who have dementia. Two models of care were studied under this project. Both models included case management and a wide range of services, such as homemaker/personal care services, adult day care, companion services, caregiver education, and family counseling. The two models varied by the intensity of the case management provided to beneficiaries and their caregivers and the amount of demonstration service costs that could be paid for by Medicare. The demonstration achieved a number of its goals, but showed mixed results in its usefulness to informal support systems. Access to community care increased by more than a factor of two and the level of unmet task assistance in caring for the person with dementia was reduced by half among those in the treatment group. These supports generally did not replace the amount of informal care, instead they allowed this time to be redirected to specific tasks. These instrumental program achievements did not lead to significant reductions in caregiver burden or depression, nursing home placement rates, or overall Medicare expenditures.

AGENCY SPONSOR: Office of Strategic Planning


PHONE NUMBER: 410-786-6663

PIC ID: 6305

PERFORMER ORGANIZATION: University of California, San Francisco, Institute for Health and Aging, San Francisco CA


TITLE: Evaluation of Rural Health Clinics

ABSTRACT: The Rural Health Clinic Services Act of 1977 authorized a new type of provider, Rural Health Clinic(RHC), for certification and licensure. The legislation provides for cost-based reimbursement for the clinics for Medicare and Medicaid. There has been rapid growth in the numbers of these clinics (3,067 RHCs listed nationwide in 1996, compared to 1,157 certified clinics in 1993. This evaluation was undertaken to assess this rapid growth. Since RHCs receive enhanced payment from Medicare and Medicaid, the concern involved whether these increased costs are justified by improvements in access to rural populations. The evaluation found that (from the sample of clinics surveyed) access to health care is increased to an extent to justify increased costs. Disadvantages to the program are primarily that the gains in access are in more heavily populated rural areas and that competition for Medicaid patients exists in medically underserved areas. An assessment of the impact of managed care on RHCs indicated that these clinics will have to adjust to increasingly competitive delivery systems in rural areas.

AGENCY SPONSOR: Center for Health Plans and Providers

FEDERAL CONTACT: Siddhartha Mazumdar

PHONE NUMBER: 410-786-6673

PIC ID: 6299

PERFORMER ORGANIZATION: Mathematica Policy Research, Inc., Plainsboro NJ


TITLE: State-Administered Programs for HIV- Related Care

ABSTRACT: The study analyzed state-administered government programs to cover and finance the health care needed by people infected with HIV, particularly under Title II of the Ryan White Care Act. The study documented a number of successful innovations developed by individual states. The study also presents assessments that administrators of AIDS service organizations have about how well each of these state-administered public programs addresses the health care needs of people with HIV in their state. Findings are presented for each of the programs. Conclusions for Title II were that generous eligibility criteria and coverage of a broad array of health services has strengthened the safety net for financing the care needed by people with HIV before they become eligible for Medicaid or Medicare. However, if federal funding for Title II is not sufficiently increased to keep up with the increasing number of people expected to receive benefits, or if future Medicaid reform allows states to establish more restrictive Medicaideligibility, Title II may not be able to provide services for all eligible people.

AGENCY SPONSOR: Office of Strategic Planning


PHONE NUMBER: 410-786-6631

PIC ID: 6993

PERFORMER ORGANIZATION: South Carolina Department of Health Administration and Health Policy, Charleston, SC