Economic Efficiency

Economic efficiency and the quality link

The direct and indirect costs of poor quality care have been well established in published studies. The literature strongly suggests that the intervention of evidence-based best practices (such as those reported in our Performance & Progress Report) and information technology that supports practitioners can be related to better patient outcomes. The right care, at the right time results in improved quality-of-life for patients, all of which can reduce the need for more costly healthcare interventions later on.

Understanding this link between quality of care and cost is essential to building meaningful and useful measures of economic efficiency.

Economic efficiency measures: progress to-date

In providing healthcare coverage for their employees, healthcare purchasers — including corporate employers and business coalitions — pay the lion's share of rising health care costs. We are committed to developing new measures that accurately reflect the value of their healthcare purchase.

WCHQ and the Wisconsin Health Information Organization (WHIO) are working together collaboratively to develop measures to demonstrate the value equation, quality divided by cost. The ultimate goal is to continuously measure and improve processes to deliver the highest level of patient-centered outcomes at the lowest cost.

Beginning in 2009, WCHQ undertook a project to help develop, test and produce a value metric for the management of diabetes with the support of the Robert Wood Johnson Foundation through Aligning Forces for Quality. The project intended to answer the question, "Are the WCHQ and WHIO diabetes performance results 'reasonably close' to suggest the WHIO standard cost data can be combined with the WCHQ quality data to report on value as a metric, or as relative 'value points' on a cost-quality quadrant graph?" The WCHQ and WHIO data were tested in partnership with three WCHQ member test site participants: Bellin Health, ProHealth Care, and ThedaCare. The project concluded in 2010 and found the diabetes performance results, using different populations and measure specifications, do not match as closely as hoped. The detailed project findings, recommendations, and next steps are available in the Diabetes Value Metric: Final Report (PDF).

Meanwhile, WCHQ will continue to report the financial and quality results of inpatient/hospital admissions for acute myocardial infarction (AMI)/heart attack care, congestive heart failure (CHF)/heart failure care, and pneumonia care. The results are available in the hospital efficiency section of the WCHQ Performance & Progress Report.