Joane H. Goodroe

Using comparative data can engage physicians in finding ways to drive efficiencies in care.

At a Glance

  • Hospitals can use comparative data to achieve healthcare delivery reform by reducing waste and improving quality.
  • Hospitals should share data with physicians to engage them in identifying areas for improvement.
  • A hospital-physician alignment model is needed as a platform for creating common goals for both hospitals and physicians.

The implications of the new healthcare reform legislation are confusing to many, but two points cannot be questioned: Payment for patient services will decrease, and demand for improved quality will increase as the nation transitions from its current volume-focused, fee-for-service approach toward a model that stresses accountability, value, and results.

Government and industry have called for comparative data that will enable more informed decisions to be made regarding cutting costs, eliminating waste, and providing better outcomes for patients. Although comparative data have been referred to as the "missing link" in healthcare reform, these data are not really missing. Comparative data already exist and have proved to be important to lowering costs while improving quality.

Although physicians generate significant costs related to patient care, they have not been involved in efforts to improve cost efficiencies. Data on outcomes, costs, and productivity measures for high-cost drivers in hospitals-especially in areas such as cardiac and orthopedic surgery-can help hospitals become more aligned with physicians.

The goal should be to provide patient outcome data that include comparative costs to educate physicians and engage them in cost-saving efforts that improve the hospital's clinical and financial performance.

Past hospital-physician alignment models shared some common features that could be keys to successful reform of the U.S. healthcare delivery system. These features lie in two critical, interrelated undertakings for each successful model:

  • Accumulating accurate data to determine where waste exists
  • Enabling physicians to drive clinical quality and significant savings by using the data coupled with aligned hospital and physician priorities

The Hidden Cost Driver

For centuries, medicine has been defined as the art and science of maintaining and restoring human health. Just like artists who have unique styles and interpretations when creating sculptures or paintings, physicians employ distinctive care delivery methods. In fact, each physician delivers patient care in a unique manner, even for the same type of patient with the same clinical diagnosis and procedure needs.

For example, surgeons complete a preference card for each surgical case to indicate what tools and supplies they want for an upcoming patient procedure. Like artists who choose their preferred materials to create a work of art, physicians prefer certain products to achieve the best possible outcome. After all, physicians are trained to deliver personal, high-quality care to their patients.

Unfortunately, the wide variation in practice patterns creates substantially higher costs and waste in the U.S. healthcare system. Physicians' personal preferences significantly drive up healthcare costs.

Because physicians learn the hands-on aspects of patient care while interning with more seasoned physicians, practice preferences are passed from one physician to another, but are not uniform among physicians.

Benchmarking National Data

By benchmarking national data and analyzing the differences in physician practice patterns, hospitals will gain the statistics and insight they need to determine where resources are being wasted and identify opportunities for improvement.

By using analytical tools, hospitals can build robust data warehouses that contain information about a wide variety of high-cost clinical procedures. The variations in physician practice patterns will be observable in such a data warehouse.

For example, one study analyzed the direct costs to 80 hospitals that performed single-vessel coronary stent replacement procedures in patients with no acute or remote myocardial infarction.a Hospitals that participated in the study were required to perform at least 275 of the described cases annually. Five cost categories were measured: devices, medical-surgical, contrast, antithrombotics, and labor. The study found a large variation in total case costs among the 80 participating facilities. For example, the average hospital total cost per procedure ranged from $1,885 to $4,245. That variation brought the average cost across all facilities to $3,091.

When analyzing costs in the five categories, researchers found not only similar variation in cost for each category, but also wide variation in utilization. For example, the average cost of antithrombotics was $350 at the time of the study, but the hospitals' costs varied from zero dollars to $1,085. This wide variation demonstrates that price is not the only driver of cost. Utilization is a key differentiator in cost per case.

Effect of New Clinical Technology on Variation and Quality

Also important to reforming healthcare delivery in the United States is understanding the clinical benefits of new technology and how they affect cost and clinical outcomes. For example, healthcare financial executives can use data on drug-eluting stent (DES) procedures to analyze both the variation in practice patterns and the clinical benefits of new technology.

The national Drug Eluting Stent Task Force examined data on stent procedures performed at 100 hospitals. The study found that between the first quarter of 2000 and the first quarter of 2003, the mean number of bare metal stents used per case increased from 1.45 stents to 1.54 stents.b The task force also reported a potential increase to more than 2.0 stents per case nationally as more complex lesions were attempted with DES procedures. Before the introduction of DESs, the national average cost per case was $2,493 for stent procedures. By the first quarter of 2005, and after the introduction of DESs, the average cost per case had skyrocketed to $4,432, with 88 percent of the cases using at least one DES. The average DES used per case was 1.63, compared with the 1.54 average of bare metal stents before DES introduction. Since DESs were introduced, various studies have shown contrasting results about the quality improvement impact of these stents, and experts continue to debate the clinical results of DES procedures in the medical literature.

Another study examined data of 17,102 procedures in patients who had received bare metal stents for evidence of repeated diagnostic or percutaneous coronary intervention (PCI) at any time within one year from initial stenting.c The study reported that 2,070 patients had a repeated PCI and 232 were referred to coronary artery bypass surgery for in-stent recurrence. Only 1,207 of the patients, or 7.1 percent, required stent-related PCI after 30 days, which is a time frame consistent with restenosis. This retrospective patient study demonstrated that the rate of bare metal in-stent restenosis was much lower than in the control arms of some of the DES trials. "The incremental benefit of widespread conversion from bare metal stents to drug-eluting stents may be smaller in some patient populations than is suggested by the results of those trials," according to the study.

These studies exemplify the importance of measuring and evaluating patient care. Accurate measurement should include examining patient-to-patient, physician-to-physician, and hospital-to-hospital data that compare utilization, clinical, and cost outcomes. This method will demonstrate whether current practices bring clinical benefit to patients and are cost-effective.

Using Comparative Data to Analyze Treatment Diversity

It is important to note that evaluating the number of stents per case does not provide an accurate clinical comparison. Instead, it is important to evaluate the number of stents used by lesion. In addition, because stents come in different lengths, it is important to obtain data that measure the specific length of a stent used.

An analysis of the practice patterns of one large hospital's cardiac program in 2007 found that the physicians used an average of 1.61 stents per lesion, compared with the national average of 1.21 stents per lesion. Further investigation demonstrated that the physicians were using shorter stents than other surgical programs in the same hospital, which contributed to the hospital's increased utilization of stents. Although these extra stents per case cost the cardiac program more than $1 million annually, no clinical benefit was seen in that patient population compared with the national average of outcomes monitored.

Again, the data confirm that there is waste in our healthcare system and that specifically measuring the method of patient care is a key factor in identifying opportunities for improvement.

Role of Healthcare Financial Leaders

Using data to drive clinical and economic improvements can be challenging for hospitals because clinical and cost systems are not integrated.

In addition, cost systems are built to manage overall costs in an area, such as an operating room, rather than the individual patient care that physicians are responsible for delivering. For example, to compare mitral valve replacement procedures, hospitals would need to exclude mitral repair, multivalve replacement, and valve replacement plus coronary artery bypass. The analysis also should include any other relevant clinical information, including outcome data and all products used on the case.

Some cost accounting systems also do not capture all items individually. Instead, some items, such as sutures, are divided across the usage of these products in the operating room. This procedure makes it difficult to compare practice patterns within the same hospital. It is also challenging for physicians to use the data in determining best practice patterns.

Hospital financial leaders can help to engage physicians by ensuring that information systems capture appropriate, beneficial data and that the data are accurate. The data can help engage physicians in improvement efforts. Moreover, physicians should be involved in the process of collating the data before reporting. This involvement will give physicians an opportunity to understand how the data are collected and identify areas where the data capture can be improved.

Another important aspect of engaging physicians is to avoid predetermining opportunities for improvement without their involvement. For example, healthcare financial leaders should not start meeting with the physicians by asking them to change a vendor they are using. Instead, financial leaders should first outline the hospital's challenges and goals and then ask the physicians about their challenges and goals to determine what can be aligned. If changes are needed, let the physicians make the initial recommendations about how to proceed and what is an acceptable way to enhance quality of care while lowering costs.

Significant Impacts on Cost Reduction, Quality Improvement

Without being able to accurately measure the diverse ways care is delivered to patients who have the same clinical conditions, hospitals will not be able to uncover the hidden costs of health care. The resulting cost savings could be used to improve access to health care for millions of Americans.

Similarly, without identifying the variations in physician practice patterns-including product and service utilization-for similar procedures and providing the data to hospital financial leaders, they cannot engage physicians in critical decision making for improvements. Only physicians can lead the effort to improve care methods and quality of care delivered. By accumulating and benchmarking cost and quality data, physicians can determine which delivery methods produce the best patient outcomes in the most efficient manner.

At a national level, a hospital-physician alignment model is needed as a platform for creating common goals for both hospitals and physicians. Experience has shown that motivating physicians to share in risk and reward results in better outcomes for patients and cost reductions for the healthcare system. Years of research have demonstrated that hospital-physician alignment models create effective partnerships among multidisciplinary healthcare providers to provide the best possible patient care at the highest level of efficiency.

The bottom line is that the missing link in healthcare reform-comparative data-isn't really missing. However, the more data hospitals can gather to effectively engage physicians in implementing efficiencies, the more potential waste and cost savings can be identified to help expand access to care for more patients.

Joane H. Goodroe is senior vice president of innovation, VHA Inc., Irving, Texas, and founder of Goodroe Healthcare Solutions, Norcross, Ga. (


a. Goodroe, J., Ketter, D., and Conte-Matos, A., "Reducing the Cost of Cardiac Procedures," The Journal of Cardiovascular Management, May/June 2002, pp. 17-19.

b. Hodgson, J., Bottner, R., and others, "Drug Eluting Stent Task Force: Final Report and Recommendations of the Working Committees on Cost-Effectiveness/Economics, Access to Care and Medicolegal Issues," Catheterization and Cardiovascular Interventions, May 2004, pp. 1-17.

c. Yock, C. A., Isbill, J. M., and King, S. B., "Bare-Metal Stent Outcomes in an Unselected Patient Population," Clinical Cardiology, August 2006, pp. 352-356.

Publication Date: Tuesday, June 01, 2010

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