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Premier Inc. Releases Groundbreaking Evidence That Improving Patient Care Can Reduce Costs, Save Lives
ORLANDO, Fla. --(Business Wire)-- June 20, 2006 -- Process improvement in the treatment of pneumonia, heart bypass patients could reduce hospital costs $1 billion; demonstration project shows it can be done
The Premier Inc. healthcare alliance today announced clear evidence that improving the care of pneumonia and heart bypass patients can save millions of dollars and thousands of lives.
According to Premier's analysis, if all pneumonia and heart bypass patients nationally had received most of a set of basic, widely accepted care measures in 2004, costs would have been as much as $1 billion lower.
The analysis is based on data from Premier's pay-for-performance demonstration project with the Centers for Medicare and Medicaid Services (CMS). Through that project, Premier collects a set of 33 quality indicators from more than 250 hospitals across the country. Because these indicators are not collected from all hospitals, Premier researchers extrapolated national implications using statistical methods.
If patients receiving a smaller percentage of widely accepted care measures had instead received most of the measures - 76 percent or more - hospitals costs would have been approximately $1 billon lower in 2004, according to Premier's analysis.
"This is compelling proof that improving the process of care can reduce costs while improving outcomes," said Richard A. Norling, president and CEO of Premier. "These findings benefit patients, hospitals and those who pay the bills."
"We believe that hospitals will close the gap now that they have this evidence to guide their efforts," Norling said. "The good news is that the hospitals in our pay-for-performance project, working with their physicians and other clinicians, have delivered 11 quarters of continuous improvement on these measures so far."
Other projected outcomes associated with improved process delivery include 3,000 fewer deaths, 6,000 fewer complications, 6,000 fewer readmissions and 500,000 fewer days in the hospital.
"This is important early evidence regarding a question that is central to the sustainability of both public and private health benefits plans - whether efforts to improve quality actually improve or worsen the affordability of care," said Arnold Milstein MD, MPH, medical director at Pacific Business Group on Health and MedPAC Commissioner. "The predominant answer emerging from these results could not be more encouraging - better care can indeed improve affordability."
The study utilized quality process indicators collected as part of Premier's Hospital Quality Incentive Demonstration (HQID) pay-for-performance project with Centers for Medicare and Medicaid Services (CMS), the first national project of its kind. Participating hospitals are eligible for Medicare incentive payments based on their performance on a set of clinical quality indicators.
Because quality of care in participating hospitals has been proven to be higher than the national average, Premier's projections in this national analysis are conservative estimates of the real impact of improved care delivery.
Using first-year project clinical quality data that has been audited and validated by CMS, Premier undertook additional analysis using the detailed cost and clinical data available in Premier's Perspective(TM) database, the most comprehensive clinical comparative database in the nation. The analysis groups patients by the quality of care they received, and then compares the groups to associated financial data collected separately by Premier.
"Premier's analysis provides evidence that reliably delivering a set of basic care measures saves lives. These results are important not only for hospitals but for patients to understand," said Donald Berwick, M.D., president and CEO of the Institute for Healthcare Improvement. "The care measures tracked in Premier's analysis are not difficult to understand; patients and families can use this information to become more informed consumers of healthcare."
The analysis is an important one for hospital executives who must make decisions that affect about both the cost and quality of care Douglas Hawthorne, chairman of the Premier board of directors and president and CEO of Texas Health Resources, which has hospitals participating in the demonstration project.
"It makes intuitive sense that improving care delivery should eventually reduce costs, if only because of reduced complications and readmissions. Most of us in healthcare have taken that on faith," Hawthorne said. "This is dramatic proof that hospitals can take relatively simple steps to significantly reduce costs without infringing on clinical decisions regarding patients' care."
Pneumonia and coronary artery bypass graft (CABG) care measures
These are the clinical quality indicators tracked in the HQID project. These indicators were developed by various agencies based on the best available medical evidence. Detailed information about these measures is available online at www.qualitydemo.com:
Pneumonia
1. Oxygenation assessment
2. Pneumococcal vaccination
3. Blood culture before first antibiotic
4. Adult smoking cessation counseling
5. Initial antibiotic selection
6. Initial antibiotic within four hours of hospital arrival
7. Flu vaccination
CABG
1. Aspirin prescribed at discharge
2. Prophylactic antibiotic selection for surgical patients
3. Prophylactic antibiotic within one hour prior to surgical incision
4. Prophylactic antibiotic discontinued within 24 hours after surgery end time
Other focus areas comprising the Premier study included heart failure, hip & knee replacement surgery and acute myocardial infarction. Preliminary results in these clinical focus areas appear similar to the results presented above, although in some complicated clinical conditions the association with cost savings and outcomes is not as clear. Further study is currently underway to fully understand the factors influencing cost and outcomes delivered in these other clinical focus areas.
Premier announced the results for pneumonia and CABG June 20 during a national press conference at the alliance's Annual Breakthroughs Conference and Exhibition, held in Orlando, FL, June 20-23. Detailed results are available online at www.premierinc.com/p4p/press.
About Premier Inc.
Premier Inc. helps hospitals accelerate performance on both clinical outcomes and supply chain costs. Premier is a healthcare alliance entirely owned by more than 200 of the nation's leading not-for-profit hospitals and healthcare systems. These organizations operate or are affiliated with nearly 1,500 hospitals and more than 38,500 other healthcare sites. Premier Purchasing Partners provides an array of services supporting health services delivery including group purchasing totaling more than $25 billion annually in supplies and equipment purchasing, as well as supply chain and clinical performance improvement services. Premier Healthcare Informatics offers performance measurement, benchmarking, and reporting products and advisory services supporting quality improvement. Premier Insurance Management Services helps hospitals manage insurance costs and improve risk management and claims capabilities. Headquartered in San Diego, CA, Premier has offices in Charlotte, NC; Chicago, IL; and Washington, DC. For more information, visit www.premierinc.com.
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