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MVC Distributes PY 2024 Final Scorecards for MVC Component of the BCBSM P4P Program

MVC Distributes PY 2024 Final Scorecards for MVC Component of the BCBSM P4P Program

The Michigan Value Collaborative (MVC) Coordinating Center distributed final scorecards for Program Year (PY) 2024 of the MVC Component of the Blue Cross Blue Shield of Michigan (BCBSM) Pay-for-Performance (P4P) Program. This report provided hospitals with their final score for PY 2024 as well as detailed breakdowns by scoring component. This was the first year of a two-year cycle for which MVC claims data was used to score hospitals on their episode spending and value metric selections. PY 2024 used baseline year claims data from 2021 and performance year data from 2023.

The episode spending conditions for which MVC is scoring hospitals for PY 2024 include chronic obstructive pulmonary disease (COPD), colectomy (non-cancer), congestive heart failure (CHF), coronary artery bypass graft (CABG), joint replacement (hip and knee), and pneumonia. These conditions differ slightly from the list of episode spending conditions available in the PY 2026-2027 cycle (view PY 2026-2027 FAQ). Figure 1 shows the frequency of hospital selections for the PY 2024-2025 program cycle for episode spending; the plurality of hospitals selected joint replacement, whereas pneumonia was selected the least.

Figure 1.

The value metrics for which MVC scored hospitals for PY 2024 included cardiac rehabilitation after CABG, cardiac rehabilitation after percutaneous coronary intervention (PCI), follow-up after CHF, follow-up after COPD, follow-up after pneumonia, preoperative testing, and risk-adjusted readmissions after sepsis. Figure 2 shows that the plurality of hospitals selected 7-day follow up after CHF, and both 90-day cardiac rehab after CABG & 30-day inpatient readmissions after sepsis were selected the least.

Figure 2.

The MVC Component of the BCBSM P4P Program evaluated each participating hospital’s risk-adjusted, price-standardized, average 30-day episode payments for their selected condition as well as rates of utilization for their selected value metric through two methods. Hospitals earned points via "improvement" by reducing their payment or improving their utilization rate from the baseline period, or alternatively earned "achievement" points by being less expensive or having a better relative utilization rate than the peers in their designated cohort. The MVC cohorts are groups of hospitals determined to be peers using factors such as hospital bed size and case mix index.

While hospitals were scored on both improvement and achievement, members received the higher of those two scores for each of their selections. Hospitals were also eligible to receive engagement points by completing eligible MVC activities. A maximum of 10 points (4 points each for the selected episode spending condition and value metric, 2 points from engagement activities) were awarded to participating members. The distribution of total points earned by hospitals for the PY 2024 is illustrated in Figure 3.

Figure 3.

On average, hospitals earned 6.6 points in total, a decrease of 0.8 points from the PY 2023 average of 7.4 points. Figure 4 shows that the episode spending condition with the highest average awarded points was joint replacement (3.1 points) followed by CABG (2.3 points). Similarly, Figure 5 shows that the value metric with the highest average awarded points was preoperative testing (3.3 points) followed by 90-day cardiac rehabilitation after PCI (2.7 points). The breakdown of average points by each program component is illustrated in Figure 6. On average, hospitals earned 1.7 of the 2 available engagement points.

Figure 4.

Figure 5.

Figure 6.

If you have any questions regarding PY 2024 of the MVC Component of the BCBSM P4P Program, please refer to the MVC P4P PY 2024-2025 Technical Document. If you would like to set up a meeting to review your hospital’s program year selections or scores, please contact the Coordination Center [EMAIL]. MVC will evaluate and release mid-year scorecards for PY 2025 in the summer of 2025.

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New Qualitative Analysis Offers Insights on How Hospitals Approach MVC P4P Program

New Qualitative Analysis Offers Insights on How Hospitals Approach MVC P4P Program

Quality improvement is critical for ensuring that healthcare services are safe, efficient, patient-centered, and equitable. As such, payers have increased their reliance on financial incentives to encourage high performance, foster improvement, and promote accountable spending. Despite the saturation of studies assessing hospital approaches to federal incentive programs, there remains a lack of information surrounding hospitals’ strategies for episode-based reimbursement in commercial payment models.

Blue Cross Blue Shield of Michigan’s (BCBSM) Hospital Pay-for-Performance (P4P) Program rewards hospitals that excel at care quality, cost-efficiency, and population health management. In 2018, BCBSM partnered with the Michigan Value Collaborative (MVC) in allocating 10% of its P4P program budget to an episode of care spending metric based on MVC data.

To fill the knowledge gaps mentioned above, a qualitative analysis published earlier this year in the American Journal of Managed Care (AJMC) [LINK] took advantage of a unique opportunity to explore hospital activity and decision-making within MVC’s episode-based incentive program. The lead author of the resulting publication was MVC Senior Faculty Advisor Dr. Scott E. Regenbogen, MD, MPH, who previously served as a Co-Director of MVC. In engaging with MVC’s hospital members, the project team aimed to understand hospital approaches to commercial incentive programs, identify best practices for success, and collect information to promote the optimal design of future metrics.

In an effort to understand the variability between participating hospitals, qualitative interviews were completed with 21 leaders from 8 intentionally selected hospitals with ranging performance metrics. Between December 2020 and November 2021, administrative leaders and quality officers were interviewed using a video teleconference-based platform. Each interview followed a standardized protocol and addressed four domains: choice of clinical condition for evaluation, strategies for episode spending reduction, best practices for success in learning incentives, and barriers to achievement.

Clinical Condition Selection Approaches

When asked about approaches to selecting clinical conditions, besides programmatic constraints, the project team found that multiple factors impacted hospitals’ decisions. Throughout the selection process, many hospital leaders aimed to identify opportunities for improvement or areas of historic underperformance.

In analyzing this trend, Dr. Regenbogen commented, “We were somewhat surprised that there was less ‘playing to the test’ than expected. For the most part, hospitals were committed to success in this program and made good faith efforts to try and achieve savings through operational improvements, not just making the numbers look good.” In addition to seeking opportunities for the greatest improvement, participants selected conditions that often aligned with ongoing value-based improvement efforts, especially those related to federal value-based financial incentive programs. A final factor contributing to the selection approach for many sites was the commitment and motivation of physician leaders to contribute to quality improvement. Most site coordinators agreed that without individual and collective dedication to hospital-based initiatives, success was unlikely.

Strategies for Episode Payment Improvement 

As members of MVC, the participants in this analysis had access to comprehensive utilization data and risk-adjusted comparisons with other hospitals across the state of Michigan. When asked about methods to improve performance, site coordinators highlighted the immense benefits of MVC’s custom analytic and annual push reports, citing the utilization of administrative and clinical data to motivate and inspire improvement at their respective hospitals. In addition to using MVC data to identify areas of growth, respondents also recognized the importance of standardizing protocols and policies to promote the implementation of consistent best practices.

Best Practices for Success in the Incentive Program 

In discussing the strategic approaches of program participants, hospitals highlighted three main areas of importance regardless of their performance rank: consistent leadership focus on metrics, readmissions reduction, and controlling costs related to post-acute care.

Obstacles to Success

However, despite these similar strategic approaches, low-performing participants also noted obstacles and barriers to their success in the program. One institution noted a failure to remain focused on cost containment for a condition across the measurement period, while another expressed a disconnect between institutional achievement goals and non-employed physician incentives. In response to participants’ obstacles to engaging with physicians, co-author and MVC Senior Advisor Mike Thompson, PhD, MPH, who served as MVC’s most recent Co-Director until June 2024, noted, “Perhaps it isn’t surprising, but the challenge of engaging front-line clinicians in pay-for-performance programs is always difficult. Bridging the gap between broader administrative goals and daily clinical operations can sometimes feel like a canyon, but it is necessary for success.”

Implications for the Future

Altogether, the data collected during the qualitative arm of this analysis gleaned key quality improvement insights that MVC can utilize to inform the continued refinement and improvement of the MVC Component of the BCBSM P4P Program. The project team posits that, to be successful, these incentives must possess enough depth and relevance to capture the attention of hospital leadership or align closely with larger initiatives to facilitate collaboration; they must address and resolve any discrepancies between the goals of the hospital and the incentives driving credentialed physicians; and, most importantly, commercial episode-based incentives should offer the chance for success by delivering not only initial performance enhancements but also consistently maintaining excellence over time.

Moving forward, continued program evaluation will be crucial for understanding how to best design metrics in the pursuit of high-value, equitable healthcare. This area of investigation opens the door to future insights into the relationship between financial incentives and quality improvement in healthcare, holding vast potential to shape future incentive-based measures and reporting. As such, MVC is committed to understanding and improving the effectiveness of its own incentive-based measures in partnership with BCBSM.

To learn more about MVC offerings and the MVC Component of the BCBSM P4P Program, please visit our website or contact us at Michigan-Value-Collaborative@med.umich.edu.

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MVC Finalizes Summary Evaluation of PY22-23 P4P Cycle

MVC Finalizes Summary Evaluation of PY22-23 P4P Cycle

This year, the Michigan Value Collaborative (MVC) completed all scoring and evaluation for Program Year 2023 of the MVC Component of the Blue Cross Blue Shield of Michigan (BCBSM) Pay-for-Performance (P4P) Program. This concluded a two-year program cycle encompassing the program methodologies and conditions utilized in PYs 2022 and 2023. MVC is excited to share its member evaluation document for these two program years, which highlights hospital performance on average 30-day risk-adjusted, price-standardized total episode payments for the included conditions across both program years.

The PY 2022-2023 program cycle utilized episode claims from 2019 through 2022. PY 2022 scoring compared performance year data from 2021 against baseline year data from 2019. PY 2023 scoring compared performance year data from 2022 against baseline year data from 2020.

Hospitals chose two conditions from seven available options for the PY 2022-2023 program cycle, including chronic obstructive pulmonary disease (COPD), coronary artery bypass graft (CABG), congestive heart failure (CHF), colectomy (non-cancer), joint replacement (hip and knee), spine surgery, and pneumonia. Among these seven P4P conditions, joint replacement was the most selected condition (40), and colectomy was selected the least (4). Trends in average price-standardized episode payments showed a consistent decrease over the years for CABG and joint replacement, and a recent downward trend for pneumonia, spine, and colectomy payments as seen in Figure 1. MVC observed relatively consistent average payments over time for CHF and COPD episodes during PY 2022-2023.

Figure 1. Average Price-Standardized Episode Payment Trends for P4P Conditions

The most striking observation in PYs 2022 and 2023 is the increasing shift to the outpatient setting for both spine and joint replacement surgeries. For joint replacement surgeries, 23.2% of episodes took place outpatient in 2019, 49.4% were outpatient in 2020, 71.6% were outpatient in 2021, and 85.4% were outpatient in 2022. Similar shifts were observed for spine surgeries during the PY 2022-2023 cycle, with the percent of outpatient spine surgery procedures increasing from 30.4% in 2019 to 51.4% in 2022 as seen in Figure 2.

Figure 2. Utilization of Outpatient Setting for Spine Surgery by Year

This shift in outpatient utilization also impacted the decrease in average total episode payments since the associated costs for outpatient surgeries were significantly lower than inpatient surgeries. The decrease in total episode payments for spine and joint replacement surgeries was largely reflected in the index payments for PYs 2022 and 2023 respectively (Figures 3 and 4).

Figure 3. Change in Average Price-Standardized Episode Components, PY 2022

Figure 4. Change in Average Price-Standardized Episode Components, PY 2023

Overall, there was not much change between PY 2022 and PY 2023 in the overall points earned and average points based on hospital characteristics, though the scores on average were slightly higher in PY 2022 (Figures 5 and 6).  For detailed, condition-specific analyses on scoring, please refer to the full member evaluation document.

Figure 5. PY 2022 Total Point Distribution (Includes Bonus Points)

Figure 6. PY 2023 Total Point Distribution (Includes Bonus Points)

If you have any questions regarding the MVC Component of the BCBSM P4P Program, please reference the P4P Technical Document for Program Years 2022 and 2023 and the MVC P4P FAQ PY 2022-2023. If you would like to set up a meeting to review your hospital’s performance, please contact the Coordinating Center at Michigan-Value-Collaborative@med.umich.edu.

 

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MVC Component of the BCBSM P4P Program: PY20 in Review

MVC Component of the BCBSM P4P Program: PY20 in Review

In early January, the Michigan Value Collaborative (MVC) distributed 2020 Program Year (PY) scores to hospitals for the MVC Component of the Blue Cross Blue Shield of Michigan (BCBSM) Pay for Performance (P4P) program. This marked the completion of the first year of a two-year cycle for which hospitals have selected two service lines (out of seven) to be scored on their episode spending using MVC data. These service lines include chronic obstructive pulmonary disease (COPD), colectomy, congestive heart failure (CHF), coronary artery bypass graft (CABG), joint replacement, pneumonia, and spine surgery. Figure 1 shows the frequency of hospital service line selections for the two-year program cycle.

Figure 1.

The program evaluates hospital’s risk-adjusted, price standardized, average 30-day episode payments for their two selected conditions through two methods. One way that hospitals earn points in the program is by reducing their payments from the baseline period (index admissions in 2017) to the performance period (index admissions in 2019). These are termed ‘improvement points’. Alternatively, hospitals are able to earn points by being less expensive than the other hospitals in their cohort. These are referred to as ‘achievement points’. The MVC cohorts are groups of hospitals determined to be peers using bed size, case mix index, and teaching status.

While participants are scored on both improvement and achievement, members receive the higher of the two scores for each service line. Hospitals are also eligible to earn a bonus point for each service line provided all hospitals in their respective cohort who selected the same condition reduce spending by five percent. A maximum of ten points can be awarded for participating members. Figure 2 shows the distribution of total points earned by hospitals for Program Year 2020.

Figure 2.

On average, hospitals earned six points, an increase of around one point from the 2019 program year average. Twenty-four hospitals received bonus points within the COPD, colectomy, joint replacement, and pneumonia service lines. Consistent with previous years, joint replacement had the average points, with pneumonia coming in a close second (see Figure 3).

Figure 3.

If you have any questions regarding the MVC Component of the BCBSM P4P program, please refer to the P4P Technical Document for Program Years 2020 and 2021 and the MVC P4P FAQ PY 2020-2021 . If you would like to set up a meeting to review your hospital’s performance, please contact the Coordinating Center at MichiganValueCollaborative@gmail.com.