HHS chief: Get ready for quality reporting

Physician quality reporting is still relatively new, but it soon will become standard, according to Health and Human Services Secretary Michael Leavitt. Doctors must be an integral part of the movement, he said. Any long-term solution to the Medicare physician payment problem will include quality reporting, he added.

Leavitt spoke with AMNews after a private meeting on Sept. 11 with the AMA Board of Trustees.

Question: You said that quality reporting is coming but the country isn't ready for it yet on a national scale. How do you see the process unfolding?

Answer: We have to start in a simple and achievable way. We have a small pile of wheels and a little chassis and a motor, and we're going to put them all together and demonstrate that we can drive this value car and make it work. We can make this work with a limited number of procedures in pilot, then we'll expand it. Over time I believe it will become standard for the industry. It needs to happen with as much speed as possible but with an eye clearly on doing it well.

Q: What is doctors' role?

A: Physicians need to define the quality measures. This is going to be happening on a local basis more than it is on a national basis. So they need to become involved in their local quality initiatives, and if one doesn't exist, they need to create one.

Q: Are the quality measures the AMA-convened Physician Consortium for Performance Improvement is developing going to be the ones used?

A: I think it will be the measures developed through the [consortium].

Q: Do you see a need for a financial incentive for physicians to participate?

A: Yes. The whole idea is to create incentives that encourage quality and efficiency. We need to pay more for better, not just more for more.

Q: Some physicians worry that their quality scores would suffer if they see sicker patients or if their patients don't follow their orders. How would you account for that?

A: We're pioneering in a way. My invitation is to hospitals and doctors to work together to figure this out. The signal is clear that we need to begin measuring value. We've done enough of it to know it can be done. We know that there are challenges, but that if we work together, we can get it done. There is not only the humanitarian imperative, but there is a financial imperative for the country to find a way to encourage high-quality, lower-cost care. It can't be done without physicians' participation.

Q: Physicians are very concerned about the Medicare pay cut of 5.1% next year and cuts for several years afterward. What is your position?

A: It's a big problem for physicians and, frankly, a big problem for me. I have 43 million beneficiaries who depend on Medicare, including my mother and father. ... We have to fix the long-term problem. The two choices on the table right now are do nothing and have the 5.1% [cut] or put in $180 billion over the next 10 years to top off the Medicare tank. I expect that neither of those extremes will ultimately be the solution. Many people are now looking for a third way, which I believe will include methods of measuring and rewarding value.

There are many alternatives being discussed. I have no particular insight on how this will come out beyond recognizing that every signal points to the need for us to be developing a reliable, trustworthy system of measuring the quality and efficiency of care. We need to do it on a local basis where the trust can be developed among and between physicians and the rest of the system. We need to do it in a way that starts simple and builds.

Q: The Census Bureau recently announced that the number of uninsured grew 1.3 million to 46.6 million. This issue doesn't seem to be gaining traction on Capitol Hill and perhaps even in the administration. Why and what will it take for change to occur?

A: There are many things that affect that number, but let's start with one thing we can all agree on: The higher health care costs are, the fewer people who can afford insurance.

Things are happening on the uninsured front all the time as states begin to experiment. The initiative I've just spoken of, which is to begin to [move to] a system that features value-based competition, will ultimately provide a means by which more people can obtain insurance.

Things that are happening in Massachusetts are a good example. Things are happening in California and Iowa, Florida. All of those are aimed at being able to expand the population of those who have insurance. There's no one thing on the horizon that will solve that problem in its entirety. But there are many, and all of them have at their core the ability to use the dollars we have more efficiently, and that means being able to measure value and to reward it.

Q: It's the five-year anniversary of 9/11. Do you feel the country is more prepared now for a terrorist attack than it was back then?

A: We're better prepared today than we were five years ago, and we'll be better prepared five years from now than we are today. It's a continuum of preparation. It's something we can never take for granted.

Q: Is there anything doctors could do to help the country be more prepared?

A: Local preparedness is the best solution. That is to say if doctors were to ask their patients the basics. Do you have a supply of nonperishable food that you can call on if it was unavailable at the stores? Do you have a first aid kit with the prescriptions that are necessary to keep you healthy for a period of a couple of weeks should circumstances require it? That kind of preparation will ultimately create a safer and healthier America.

Physicians can also be advocates for the development of surge capacity. Every hospital needs a plan, every community needs a plan, every doctor's office needs a plan.

Q: The president recently issued an order on health care transparency. Where is the agency on that?

A: People have tried to measure value for years, but have not succeeded because they lacked actuarially credible data on which to draw conclusions. The federal government has made it clear that we're going to contribute our data to those efforts and that there are four cornerstones that allow the measurement of value and to reward it. The first is standard health information technology. The second is measurement of and use of quality comparisons. The third is measuring price in definable episodes of care, and the fourth is having proper incentives.

The president's executive order indicates that, as a condition of doing business, not only government agencies but those we do business with will be asked to use those four cornerstones. The responsibility is to implement health information technology standards to the degree they now exist, and they're growing all the time so we expect that [a lot] of people as they adopt technology will become interoperable. That's just a function of time.

With respect to quality, I expect that in the next two years value-based competition will begin to take place in limited ways in a limited number of communities. In five years, it will be a significant part of the system. Within 10, we'll look back and say that's the foundation of the system.