Update from the Lily Pad

1. Update from the Lily Pad Greg Belden Senior Program Associate March 4, 2005

2. Why Isn’t Quality Better? Gridlock in the Health Care System: Everyone Responsible, No One Accountable New Thinking is Needed to “Leapfrog” the Gridlock

3. Populating the Pond Leapfrog represents.. • More than 165 large health care purchasers • More than 36 million Americans • More than $66 billion in health care expenditures

4. Leapfrog’s Mission Trigger giant leaps forward in the safety, quality and affordability of health care by: • Supporting informed health care decisions by those who use and pay for health care • Promoting high-value health care through incentives and rewards

5. “Health Care is Local”: Leapfrog is a National Model w/ a Regional Approach to Change • 28 Regional Roll-Outs (RROs) (in green) • Most RROs defined by Metropolitan Statistical Area (MSA); some are statewide • 21/28 coalition-led • Other 7 led by large Fortune 500 companies • Responsible for increasing survey participation and leap-implementation

6. Pillars of Value-based Healthcare Purchasing Incentives & Rewards Standard Measurements & Practices Transparency

7. Standard Measurements & PracticesTo achieve transparency and improved quality, we must ‘talk the same language’ when asking hospitals & doctors to report

8. Initial Safety ‘Leap’ Summary • An Rx for Rx • Computer Physician Order Entry (CPOE) • Up to 8 in 10 serious drug errors prevented • Sick People Need Special Care • ICU Daytime Staffing with CCM Trained M.D. live or via tele-monitoring, or risk-adjusted outcomes comparison (IPS) • 29% mortality reduction (JAMA, 11/02)

9. Initial Safety ‘Leap’ Summary • The Best of the Best • Evidence-based Hospital Referral (EHR) or risk-adjusted outcomes comparison • > 30% mortality reduction for 7 complex treatments 4.Leapfrog Quality Index • Rolled-up score of the remaining 27 of the 30 NQF-endorsed Safe Practices

10. What We Stand to Gain from Initial 3 Leaps Alone? Annual Gain Projected by University of Michigan and University of Washington: 560,000-907,000 serious medication errors  61,700 deaths  61,700 X 5 disabilities Potential system-wide savings of $51.3 billion / year from lives saved, improved worker productivity and hospital efficiency (if fully implemented in all U.S. urban hospitals)

11. TransparencyMake reporting results routine and use results to make health care purchasing decisions

12. Leapfrog’s New Hospital Quality and Safety Survey Results Display

13. Leapfrog’s New Hospital Quality and Safety Survey Display (cont.)

14. Quality and Safety Survey Results As of February 28, 2005 • 1,102 hospitals nationwide have responded to Leapfrog’s survey (706 w/in RROs) • 56% of hospitals targeted by Leapfrog’s Regional Roll-Outs have responded • >50% participation in 18/23 RRO’s

15. Quality and Safety Survey Results, cont’dAs of February 28, 2005 • 6% hospitals fully implemented CPOE • 24% hospitals fully implemented IPS • EHR results • 14% CABG • 13% PCI • 4% AAA repair • 17% Pancreatectomy • 11% Esophogectomy • 32% NICU • 23% hospitals received full credit for NQF Safety and Quality Index

16. Incentives & RewardsEncourage better quality of care through both financial and non-financial incentives and rewards

17. “Putting the Money Where Our Mouth Is- Working Markets Must Reward Quality” Leapfrog’s 2-pronged approach to increase payer engagement in incentives and rewards #1 To disseminate incentive and reward best practices and encourage employers and health plans to adopt them #2 To develop own turn-key incentive and reward solutions

18. Prong #1: Disseminate and Foster Employer and Health Plan Incentive and Reward Best Practices • Collect and disseminate information on leading-edge quality incentive and reward programs • Leapfrog’s Incentive and Reward Compendium (http://www.leapfroggroup.org/ircompendium.htm) • 90 programs (1 out of 4 include Leapfrog measures) • Push for the incorporation of Leapfrog’s performance measures into new incentive and reward programs and those programs that currently do not include them • Leapfrog’s standard health plan contract language and request for information (RFI) language (eValue8)

19. Incentive and Reward Examples from the Field Empire Blue Cross, IBM, PepsiCo, Verizon, and Xerox (NY) • 4% bonus if meet Leapfrog’s CPOE and ICU standards Group Insurance Commission (MA) • $25-50K bonus if plans increase admissions to Leapfrog-compliant hospitals Boeing (Nationwide) • Union employees and early retirees obtain 100% coverage after deductible for services provided by a Leapfrog-compliant hospital and 95% coverage for services provided by non-Leapfrog-compliant hospital

20. Prong #2: Develop Own Turnkey Solutions • Leapfrog’s Hospital Rewards Program:A National Incentive and Reward Program • Can be implemented by health plans, purchasers and coalitions – seeking implementers now! • Adapts CMS-Premier demonstration program for the commercial sector • Focuses on performance improvement in both effectiveness and efficiency in 5 important clinical areas (see next slide) • Hospitals can participate with minimal additional reporting • Rewards both top performers and improvers

21. Focused Clinical Areas Were Chosen to Maximize Commercial Employer Impact • Each clinical area has NQF-endorsed measures collected through the ORYX initiative or through Leapfrog • Benchmarked against Medstat’s MarketScan, the 5 represent 33% of admissions and 20% of a commercial payer’s I/P spend

22. Hospitals Arrayed in Four Groups Using Cohort Methodology CABG Efficiency and Effectiveness Percentile Comparisons Perspective Comparative Database: 3Q01 - 2Q02 0.00% Significantly worse thantop 2 deciles (p<.05) 10.00% 20.00% Significantly worse thantop 2 deciles (p<.10) 30.00% 40.00% Not significantly differentfrom top 2 deciles (p>.10) Efficiency 50.00% 60.00% 70.00% Top 2.5 deciles 80.00% 90.00% 100.00% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00% Effectiveness Percentile

23. License data: Access summary data only (no detailed cost or quality information) Data sets are state-specific Incorporate data into any program they currently have Users can refer to these data as Leapfrog/JCAHO data but cannot use the Leapfrog brand License program: Abide by Leapfrog program rules for rewards Encourage hospital participation Supplement LFHRP resource-use data with plan payment data Participate in best practice sharing with others Receive extensive implementation support from Leapfrog Allowed to use Leapfrog brand Purchasers and Plans Can Execute Program in One of Two Ways More details at: https://leapfrog.medstat.com/hrp/index.asp

24. Leapfrog Hospital Rewards Program Coming to Phoenix Market • Human Resource Policy Association Regional Health Care Reform Program • Designed to advance the quality and efficiency of health care in markets around the country • Defines an initial set of quality and efficiency performance measures for hospitals (Leapfrog) and physicians (Bridges to Excellence) • Piloted by Cigna in Phoenix market • The program will also encourage adoption of The Leapfrog Group's Hospital Rewards Program • Multi-stakeholder kick-off meeting on March 23rd

25. The “Leap” Over the “Gridlock” has Begun • More purchasers joining Leapfrog – 7 to 160 in 4 years • More hospitals reporting results—marketplace transparency • More hospitals implementing leaps (refocus of priorities) • Health plan user groups collaborating to institute change • Wide-spread promotion among employees

26. Let’s work together to keep leaping and paint Arizona green!