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Health Policy Stakeholder Meeting

Response of the Leapfrog Group, www.leapfroggroup.org

Leah Binder, CEO

(202)292-6713, LBinder@leapfroggroup.org

The Leapfrog Group shares President-Elect Obama's belief that we cannot reform the health care

system without containing costs. Moreover, like the President-Elect, we believe that costs can becontained in a manner that improves rather than detracts from the quality of care. Ourorganization has been devoted to these goals since our formation in 2000. We have beendeveloping and testing models, primarily in the private sector, many of which have beenincorporated into public sector programs as well. We seek to partner with the newAdministration to help achieve our shared objectives in the short and long run, and offer to be aresource for new ideas, approaches and innovations in the coming months and years.

Health policy priorities/goals in the short term

1) Legislation expanding access to care should require public reporting by participatinghospitals comparing them on meaningful measures of both efficiency and qualityand

then aligning payment incentives to performance. The Leapfrog Hospital Survey is the

only tool offering this kind of information currently. Its data covers all payors (includingCMS and Medicaid), and includes a dashboard of proven-meaningful efficiency data as wellas quality and patient safety information. Strong literature suggests that 1) hospitals thatperform on the Leapfrog survey are higher quality1, and 2) significant cost savings can beachieved by meeting the standards in the survey, estimated most recently at over $12 billion ayear2.

2) Facilitate implementation of gainsharing and other payment approaches in order to

better align economic incentives between physicians and hospitals resulting in lower costs

and higher quality. Such alignment opens the door to incentive arrangements to reduce HospitalAcquired Conditions, improve surgical patient flow, and reduce overuse of resources. There ispromising evidence of substantial cost savings possible through delivery system innovations.

Leapfrog is also undertaking a gainsharing demonstration program and has promising research onthe cost and quality implications of reducing hospital acquired conditions.

3) New federal investment in healthcare information technology should require meaningful

use of such systems and ongoing evaluation of their effectiveness. Newly funded systemsshould demonstrate interoperability (including unique patient identifiers) and capacity to providemeaningful quality data that can be used to improve performance. Implementation of new ITsystems should be competent, and according to Leapfrogs data the challenge of this is sosignificant Leapfrog is convening a consortium on the subject. Systems should also becontinually evaluated. The Leapfrog Hospital Survey includes the only tool hospitals can use toannually evaluate the safety and effectiveness of CPOE systems; such evaluation tools should beincluded in HIT legislation.

1 Jha AK, Orav EJ, Ridgway, AN, Zheng J, Epstein AM. Does the Leapfrog program help identify highquality hospitals? Commission Journal on Quality and Patient Safety. Joint Commission Resources 2008Jun;34(6):318-25.2 Lwin AK,Shepard DS. Estimating Lives and Dollars Saved from Universal Adoption of the LeapfrogSafety and Quality Standards: 2008 Update. Schneider Institutes for Health Policy, Heller School, BrandeisUniversity. Prepared for The Leapfrog Group, December 2008.

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Health policy priorities/goals in the long term

Improve the value of health care to sustain Americas health care system, cut costs, and

improve patient safety and quality.

The mechanisms for achieving the goal (i.e., executive order, regulation, guidelines, policy

change or legislation)

Congressional amendment of the Civil Monetary Penalty Law would expedite implementation ofgainsharing programs. For other priorities variety of means are being pursued in partnership withother purchasers and consumers. Goals are also being pursued at the local and state level,working with hundreds of business coalitions and businesses across the U.S. to 1) measure cost-effectiveness and quality, 2) compare hospitals on those metrics, and 3) use the data to drivechange.

Any budgetary or appropriations concerns or impact

Reducing costs needs to be a priority or the private sector contribution to healthcare will be

at risk, and that will dramatically increase costs to taxpayers. As President-Elect Obama hasoutlined, cost reduction is achievable and critical. Leapfrog has reviewed the literature andestimates savings of approximately $12.1 billion in one year if hospitals achieved three of

Leapfrogs key standards. Leapfrog preliminary analysis in New York suggests savings onaverage of $1 million per hospital achievable with the reduction in certain preventable hospitalacquired conditions. Other compelling research suggests delivery system reforms like changingthe way hospitals schedule OR time can demonstrate savings as high as 15%. Leapfrog, and theprivate payers that founded and support us, have the impetus, experience and data to support thekind of fundamental change necessary to control costs.

In addition, it is critical to impose accountability on HIT investment, to assure appropriateimplementation and evaluation of systems, and that they contribute to measurement andaccountability for quality and efficiency performance.

Any other HHS related issue

Accelerate the CMS move toward value-based purchasing. Leapfrog was pleased to workalongside CMS in promoting value-based purchasing in the private sector and would like to seethe new administration continue and expand work in this area. We would like to see alignmentbetween the incentives structures used in the private sector with those used at CMS. Informationgathered through value-based purchasing should be made publicly available for use by purchasersand consumers.

Improve usability and availability of CMS data, such as DRG weights and risk models, toallow researchers and health care purchasers to do financial planning and modeling to reducecosts. Leapfrog now wants to address quality, efficiency, and cost per episode of illness togetheras targeted outcomes that follow from the consistent use of evidence-based protocols in hospitalsettings. Purchasers have requested and hope to acquire CMS claims information to integrate in

our value-based purchasing efforts in the private sector.

Better integrate reporting of data in the private and public sectors: The CMS website doesnot report data from Leapfrog or other publicly available information from the private sector,unlike some states that use Leapfrog data on their website. Yet data missing from the CMSwebsite are some of the most critical factors known to influence safety and cost-effectiveness in ahospital.

The Leapfrog Group, www.leapfroggroup.org

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Support AHRQs efforts in quality and transparency. AHRQ has developed the H-CUPdatabase which is an extraordinary resource for analyzing opportunities for improvements inquality and cost-effectiveness, although the database needs to identify individual hospitals in itspublic reporting.

CDC needs to work collaboratively with CMS on issues related to hospital-acquiredinfections. An OMB report in April 2008 suggested that there was little integration of policyinitiatives and that has hampered federal effectiveness in addressing this critical issue.

The Leapfrog Group, www.leapfroggroup.org