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© 2007 American Public Health Association
DOI: 10.2105/AJPH.2007.115337
RESEARCH AND PRACTICE |
William B. Weeks is with the Veterans Administration (VA) Outcomes Group Research Enhancement Award Program, VA Medical Center, White River Junction, Vt, and the Department of Psychiatry, Dartmouth Medical School, and the Dartmouth Institute for Health Policy and Clinical Practice, Hanover, NH. Alan N. West and Richard E. Lee are with the VA Outcomes Group Research Enhancement Award Program, VA Medical Center, White River Junction. Amy E. Wallace is with the VA Outcomes Group Research Enhancement Award Program, VA Medical Center, White River Junction, and the Department of Psychiatry, Dartmouth Medical School, Hanover. David C. Goodman is with the Department of Pediatrics, Dartmouth Medical School, and the Dartmouth Institute for Health Policy and Clinical Practice, Hanover. Justin B. Dimick is with the VA Outcomes Group Research Enhancement Award Program, VA Medical Center, White River Junction, and the Department of Surgery, University of Michigan, Ann Arbor. James P. Bagian is with the Veterans Health Administration and the VA National Center for Patient Safety, Ann Arbor, Mich, and the Department of Military and Emergency Medicine, Uniformed Services University of the Health Sciences, F. Edward Hebert School of Medicine, Bethesda, Md.
Correspondence: Requests for reprints should be sent to William B. Weeks, MD, MBA, 215 N Main St, VAMC (11Q), White River Junction, VT 05009 (e-mail: wbw{at}dartmouth.edu).
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ABSTRACT |
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 TOP ABSTRACT INTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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Objectives. We quantified older (65 years and older) Veterans Health Administration (VHA) patients’ use of the private sector to obtain 14 surgical procedures and assessed the potential impact of directing that care to high-performance hospitals.
Methods. Using a merged VHA–Medicare inpatient database for 2000 and 2001, we determined where older VHA enrollees obtained 6 cardiovascular surgeries and 8 cancer resections and whether private-sector care was obtained in high- or low-performance hospitals (based on historical performance and determined 2 years in advance of the service year). We then modeled the mortality and travel burden effect of directing private-sector care to high-performance hospitals.
Results. Older veterans obtained most of their procedures in the private sector, but that care was equally distributed across high- and low-performance hospitals. Directing private-sector care to high-performance hospitals could have led to the avoidance of 376 to 584 deaths, most through improved cardiovascular care outcomes. Using historical mortality to define performance would produce better outcomes with lower travel time.
Conclusions. Policy that directs older VHA enrollees’ private-sector care to high-performance hospitals promises to reduce mortality for VHA’s service population and warrants further exploration.
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INTRODUCTION |
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TOPABSTRACTINTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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Since its reorganization in 1996, the Veterans Health Administration (VHA) has made a major institutional commitment to improve the quality of the care provided to veterans.1 As part of this effort, VHA has built a nationwide electronic medical record that includes physician order entry (an electronic prescribing system). This electronic record has facilitated the development of a performance measurement and feedback system that evaluates a variety of quality-of-care indicators: access to care (e.g., wait times to appointments), adherence to evidence-based guidelines (e.g., diabetic foot and retinal examinations), and both medical2 (e.g., hypertension or glycemic control) and surgical (e.g., risk-adjusted general3 and cardiothoracic surgery4) outcomes.
Although these efforts focus on the care that veterans obtain within the VHA system, many VHA patients also receive care in the private sector. Most VHA patients who are 65 years and older are concurrently enrolled in Medicare5,6 and are known to obtain much of their routine outpatient care,6,7 acute cardiac care,8,9 and elective coronary revascularizations10–12 in the private sector. Surveys of younger VHA patients also report frequent use of private-sector care.13–15
Frequent use of private-sector care raises the possibility that outcomes could also be improved by influencing the care that VHA patients receive outside of the VHA. Directing patients to higher-quality care would seem particularly important for common, high-risk procedures that show substantial variation in outcomes across hospitals,16,17 and it has been proposed as a mechanism to improve outcomes among the Medicare population.18,19 To determine the magnitude of the opportunity to improve outcomes for VHA patients who undergo high-risk procedures, we linked VHA and Medicare databases to determine how frequently VHA patients obtain these procedures in the private sector and to assess the potential impact of directing their care to high-performance hospitals (based on historical performance and determined 2 years in advance of the service year).
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METHODS |
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TOPABSTRACTINTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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We conducted a retrospective study of veterans 65 years and older who (1) were patients in the VHA health care system during 2000 and 2001 and (2) obtained, in either a VHA or a Medicare-funded private-sector hospital, any of 14 procedures that have nontrivial mortality rates and show hospital-specific variation in 30-day risk-adjusted mortality among Medicare beneficiaries.17 These procedures included 6 cardiovascular procedures (coronary artery bypass grafting [CABG] surgery, carotid endarterectomy, lower extremity bypass surgery, aortic valve replacement, elective abdominal aortic aneurysm repair, and mitral valve replacement) and 8 cancer resection procedures (colectomy, lobectomy, nephrectomy, gastrectomy, cystectomy, pancreatectomy, pneumonectomy, and esophagectomy).
Emergent cardiovascular cases and non–cancer-related resection procedures were eliminated from the analysis. The International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM)20 codes and specifications used to define these procedures are provided in Table 1
. We used data from several sources to answer 3 questions: (1) How many of these procedures do VHA patients obtain in VHA or the private sector? (2) Do VHA patients obtain private-sector procedures in high-performance hospitals? (3) What are the mortality and travel time implications of directing veterans’ private-sector care to high-performance hospitals?
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Identification of Veterans Health Administration Patients
From VHA administrative databases, we identified veterans who were 65 years or older and enrolled in the VHA health care system in 2000 or 2001 ("VHA patients"). Enrollment was defined as being listed in the VHA enrollment file and using VHA health services within the prior 3 years. These criteria were adopted for 2 reasons. First, the VHA enrollment file was established to identify patients for whom VHA has an obligation to provide a medical benefits package.21 Second, service use within 3 years "vests" patients (i.e., classifies them as endowed with rights for services) for the purposes of administering the Veterans Equitable Resource Allocation system, a method of allocating VHA’s congressionally appropriated budget across geographically defined service networks. Both enrollment and vesting are used to define the VHA service population—essentially, the "covered lives" for whom VHA has a potential medical benefits liability—and replicate methods used previously.7,22,23
Health Service Use
VHA use.
To determine whether older VHA patients obtained any of these procedures in the VHA system, we used ICD-9-CM codes from the acute care section of the VHA’s Medical SAS Inpatient data sets.24 These patient treatment file data sets are national administrative data for VHA-provided health care that are extracted from the National Patient Care Database, which is maintained by the VHA Office of Information at the Austin Automation Center, the central repository for VHA data. These data sets include information on the veteran, such as age at procedure and zip code of residence, as well as a date-of-death variable, which we used to calculate crude 30-day mortality for these procedures.
Private-sector, Medicare-funded use. Each year, the VA Medicare Data Merge Initiative25 submits to the Centers for Medicare and Medicaid Services (CMS) a file of social security numbers of veterans known to VHA as eligible or potentially eligible to receive health care through VHA; the CMS then extracts Medicare enrollment and claims data for these social security numbers.26 To determine whether older VHA patients obtained any Medicare-funded procedures in the private sector, we used ICD-9-CM codes from hospitalizations in this VA–Medicare data set. From the claims data, we obtained the Medicare provider number for the facility where the procedure was obtained, and we identified the procedure-specific performance quintile for the hospital, as described in the next section.
Identification of High- and Low-Performance Private-Sector Hospitals
We used an established method used by Birkmeyer et al.17,27 to rank the performance of hospitals that were reimbursed by Medicare for providing these 14 surgical procedures between 2000 and 2001. We ranked them on 2 parameters that have been predictive of future performance: historical procedure volume (i.e., the average annual number of procedures performed at a particular hospital in the recent past) and historical risk-adjusted mortality. Rankings were based on the results of 2 logistic regression models used to predict surgical mortality (defined as death during hospitalization or within 30 days of discharge), which we risk-adjusted for age, gender, and comorbidities.
To reflect the reality of the lag time necessary to obtain the data required to pursue this strategy, we applied standards based on the actual availability of data. For example, we used data from 1996 to 1998 to calculate hospital-specific average annual procedure volumes and risk-adjusted mortality, and from those figures we estimated hospitals’ expected performance in 2000 and ranked them accordingly. Because a small minority of hospitals were new and did not have historical information from the period examined, we were not able to rank every hospital (the total number of each procedure performed in the private sector and the number we were able to match to ranked hospitals are provided in Table 1
). However, to be conservative, we used "intent-to-treat" analytic methods; that is, we included even the patients whom we were not able to link to ranked hospitals in our denominator.
We aggregated hospitals into quintiles on the basis of each hospital’s rank on either volume or mortality, with quintile 1 representing the highest performance level (highest expected procedural volumes or lowest expected operative mortality) and quintile 5 representing the lowest performance level. Constructing these quintiles required several steps. First, we listed the hospitals in descending order of historical volume or risk-adjusted mortality rank. Second, we calculated the total number of each procedure performed in all Medicare hospitals over each year and divided the total volume into quintiles. We then used hospital-specific volumes to assign each hospital to the appropriate quintile. Hospitals whose procedures fell across 2 quintiles were assigned to the higher-performance quintile.
Effect of Directing Private-Sector Care to High-Performance Hospitals
For either volume or mortality, we defined high-performance hospitals as those in the best 2 quintiles. Although we considered examining only hospitals in the first quintile, doing so would have severely limited geographic access and rendered the additional travel time overly burdensome. To determine the mortality effect of directing care to high-performance hospitals, we compared expected mortality based on actual performance and VHA patients’ use patterns in 2000 and 2001 ("actual") to those expected if patients had been directed to high-performance hospitals ("with direction").
Directing care to high-quality hospitals is likely to cause additional travel time for patients.18 Using a methodology that accounts for distance, speed limits, and traffic congestion,28 we computed travel time from the patient’s zip code of residence to the private-sector hospital where care was provided as well as to the nearest high-performance hospital. We then calculated the additional travel time associated with directing private-sector care: the difference between the travel time to the hospital where care might have been provided ("with direction") and the travel time to where it actually was ("actual").
Therefore, to determine the potential effect on mortality and travel time of directing veterans to high-performance private-sector care, we calculated the expected risk-adjusted mortality and travel times using 2 scenarios: actual and with direction. We compared the 2 scenarios and applied the change in expected risk-adjusted mortality to calculate potential lives saved.
Considering Veterans Health Administration Performance
Finally, we used data from the VHA inpatient data sets to determine the volume of each procedure performed at each VHA medical center where that procedure was performed. For each procedure examined, we determined the number of VHA medical centers whose procedure volumes among VHA patients 65 years or older were at least as high as the minimum private-sector volume in the second-best quintile for Medicare beneficiaries who were 65 years or older. In addition, we calculated procedure-specific crude 30-day mortality for veterans who obtained these procedures in the VHA system and compared them with procedure-specific crude 30-day mortality for private-sector hospitals, weighted to represent VHA patients’ actual use of those hospitals as well as modeled use of hospitals, on the basis of direction of private-sector care.
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RESULTS |
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TOPABSTRACTINTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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Veterans Health Administration Patients’ Use of the Private Sector
Over the 2-year study period, older veterans who were enrolled in VHA obtained a total of 139317 procedures: 119245 (85.6%) were obtained in the private sector, funded by Medicare, and 20072 (14.4%) were obtained in VHA (Table 1
). VHA provided only about one eighth of the cardiovascular procedures that these older veterans received and a little more than one fifth of their cancer resections. Reliance on VHA was greatest for cystectomies and esophagectomies, VHA providing more than one fourth of these procedures.
Distribution of Private-Sector Care Across Performance Quintiles
Ninety-seven percent of these high-risk procedures were obtained in hospitals that we were able to rank by performance quintile. By definition, the expected distribution of patients, assuming that older VHA enrollees’ use of the private sector was similar to that of the overall Medicare population, was 20% in each quintile. With only a few exceptions among the less-common surgeries, and regardless of procedure and of whether performance was defined by historical volume or historical risk-adjusted mortality, we found that VHA patients used lower- and higher-performance hospitals at close to expected rates (data not shown).
Effect of Directing Private-Sector Care to High-Performance Hospitals
If VHA patients who were already using the private sector had obtained their private-sector care in only the best 2 performance quintiles, between 376 and 584 lives could have been saved, depending on the method used to define performance (Table 2). If these patients had been directed to historically high-volume centers for their procedures, expected mortality would have decreased by 6.7% (from 4.76% to 4.44%), potentially saving 376 lives during the 2 years. Directing private-sector care to medical centers with a history of low risk-adjusted mortality would have decreased expected mortality by 10.1% (from 4.93% to 4.43%), potentially saving 584 lives. Under either scenario, about half of the potential lives saved would come from directing private-sector CABG surgery and aortic valve replacement to high-performance hospitals.
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With performance based on historical volumes, substantial travel time would be associated with directing patients to better private-sector care. Directing patients to high-performance CABG surgery and aortic valve replacement hospitals would have led to mean additional travel times of 61 and 54 minutes, respectively, but would have saved 188 lives. Alternatively, with performance based on historical risk-adjusted mortality, a much more modest travel time would be associated with directing private-sector care. Under that scenario, directing patients to high-performance CABG surgery and aortic valve replacement hospitals would have led to a mean additional travel time of 20 and 15 minutes, respectively, and would have saved 318 lives.
We show the application of private-sector performance to VHA care in Table 3. For each procedure, we used the minimum annual volume for private-sector hospitals in the best 2 quintiles based on historical volumes and counted the VHA medical centers that met this volume threshold. We found that only a few VHA medical centers performed enough procedures annually to meet these volume standards; none did so for CABG surgery or aortic valve replacement. For each procedure, we also compared its actual crude 30-day mortality in the private sector to the likely 30-day crude mortality if care had been directed to better hospitals, on the basis of historical mortality rates as well as the VHA 30-day crude mortality rate. For 13 procedures, on the basis of actual use, expected crude mortality rates were lower in the private sector, whereas for 1 procedure—carotid endarterectomy—they were lower for VHA care, an advantage that disappeared when we compared results that would have been expected in high-performance private-sector hospitals.
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DISCUSSION |
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TOPABSTRACTINTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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We found that the large majority of older VHA patients’ cardiovascular procedures and cancer resections were provided in the private sector. These patients and their doctors did not appear to select high-performance private-sector hospitals; instead, VHA patients were equally likely to obtain care in low- and high-performance surgical centers. We found that directing VHA patients’ private-sector care to high-performance hospitals might save a substantial number of lives. When high performance in the private sector is defined by historical risk-adjusted mortality, directing care would save more lives and minimize additional travel time.
Our findings are important for several reasons. First, they confirm that VHA patients are distributed evenly across private-sector hospitals of varying performance. To be sure, the influence of publicly released outcomes data does not appear to influence hospital choice for most private-sector patients.29–31 However, our study suggests a potential new role for VHA—that of taking an active role in coordinating private-sector care for VHA enrollees. Indeed, through cooperative efforts between VHA and the CMS, the VHA may be able to influence the quality of care received by veterans treated outside of VHA facilities by providing incentives for these patients to obtain private-sector care in high-performance hospitals.
Second, our analysis suggests that efforts at directing private-sector care could if necessary be focused on a limited number of procedures. Although every potential life saved is important, our findings suggest that prioritizing CABG surgery and aortic valve surgery would be the most productive and efficient approach to saving lives. Further, our results indicate that veterans would not bear an undue travel burden if such a program is implemented.
Finally, our findings suggest that a focus on improving the quality of VHA enrollees’ private-sector care is likely to have a greater payoff than a focus on improving care provided within VHA, for 3 reasons. First, directing private-sector care is feasible. The Leapfrog Group32 and other health care purchasers, including the CMS,18 have examined the benefits of restricting care to high-performance hospitals. Particularly if coordinated with Medicare, VHA could adopt a combined health maintenance organization (HMO)–insurer approach to managing the outcomes of its overall service population.
Second, because of the much greater volume of private-sector care, smaller improvements on outcomes can have a greater impact on the VHA’s service population than could additional efforts to improve VHA care. Given the volumes and crude mortality rates for VHA care for these procedures, an overall reduction in the VHA’s crude mortality rates for all procedures of 52% would be required to save the same number of lives that could be saved through directing private-sector care to high-performance hospitals. VHA crude mortality rates would then be approximately one half the rates of top private-sector performers, an unrealistic goal for improvement for any health care provider, particularly because patients who obtain these procedures within VHA are more likely to be sicker, poorer, and uninsured, rendering risk-adjusted mortality reduction much harder to achieve.
Third, although some might argue that an alternative to directing private-sector care would be to direct care into the VHA system, this strategy might not be as effective or efficient: relatively few VHA sites provide these services, and the costs of absorbing dramatic increases in volume would be prohibitively high.
Limitations
Our study has several limitations. First, the risk-adjusted mortality rates that we obtained from our analysis of Medicare hospitals were not gender specific. This raises the possibility that rates may be different for VHA patients—the vast majority of whom are men—who use the private sector. However, gender was incorporated into the risk-adjustment methodology, and we recently found that a risk-adjustment model used by New York State applies well to male VHA patients who use the private sector for CABG.23
Second, we used crude, 30-day mortality rates to consider the relative performance of veterans’ actual and potential use of the private sector and VHA. Because sicker, uninsured, and poor veterans are more likely to use VHA for inpatient services, risk adjustment would be required for comparison of true performance; therefore, no conclusions should be drawn regarding the relative performance of VHA and the private sector from this analysis.
Third, our analysis assumes 100% patient compliance with direction of care. Established practice and referral patterns, as well as patient indifference toward publicly reported data, suggest that VHA would need to play an active role to achieve the potential benefits of directed care that we project. Further, directing private-sector care for patients who only sporadically use the VHA system may be particularly challenging. However, the very high rate at which Medicare funds VHA patients’ private-sector care suggests that coordination of care with the CMS, and potentially sharing financial incentives to obtain care in high-performance settings, may be an effective way to influence VHA patients’ choice of a private-sector hospital for high-risk surgery.
Fourth, although the VA–Medicare data set should capture all Medicare-funded private-sector procedures, not all older VHA patients’ private-sector procedures are paid for by Medicare, even for those patients enrolled in Medicare. By law, after Medicaid, Medicare is the payer of last resort; therefore, commercially insured older veterans who obtained these procedures in the private sector and whose insurance fully covered the costs of the procedures were not included in our analysis. Using a comprehensive VHA–private-sector data set from New York for the years 1998 through 2000,12,23 we found that 8.5% of private-sector CABG surgeries obtained by older VHA enrollees were not paid for by Medicare. Although the proportion of procedures obtained by older Medicare- and VHA-enrolled patients that are not paid for by Medicare probably vary by procedure, our results should be considered a lower bound for the potential effects of directing patients to better private-sector care.
Implications for Further Research
Our theoretical findings raise an important practical consideration: who might pay for administrative or patient incentive expenses associated with coordination of care? The answer, of course, depends on which parties might benefit from such an arrangement and to what relative degrees. To address those questions, we propose that VHA and Medicare collaborate on a demonstration project for Medicare-enrolled VHA patients as follows: VHA would provide the administrative infrastructure required to facilitate direction of care to high-performance hospitals and would be allowed to provide incentives for veterans to pursue higher-quality care through partial subsidy of their Medicare co-payment; cost savings associated with avoided complications would accrue to VHA, up to the point of VHA’s subsidy liability.
This model would benefit several parties. First, VHA and Medicare should be interested in improving the quality of care provided to their service populations; further, they should realize indirect financial benefits through reduced liability from surgical complications33 or early payment of death or disability benefits. High-performance hospitals that perform these procedures might benefit from additional volume and higher co-payment receipt rates, thereby reducing the charity care that, no doubt, they frequently supply to VHA patients. Finally, veterans would retain hospital choice—they could choose a low-performance hospital and not receive the subsidy, but those who chose high-performance hospitals and the subsidy might have lower out-of-pocket health care costs and better outcomes. Although compromises regarding the optimal distribution of financial obligations—such as whether high-performance hospitals might accept lower, but guaranteed, co-payments or whether veterans might accept co-payment reduction instead of elimination—might be negotiated, none of the potential benefits that might accrue to these parties could be realized until a demonstration project was conducted.
Conclusions
Our findings suggest that VHA should consider focusing quality improvement efforts on the care that VHA patients receive in the private sector, particularly for the high-mortality procedures that VHA patients frequently obtain. The impact of directing VHA patients who use the private sector to the highest-performing hospitals should have a greater effect on the service population than should efforts directed exclusively internally. VHA has a commitment to provide safe, high-quality care to its enrolled service population. One effective mechanism to meet this obligation is to help ensure the quality of care provided to veterans outside of VHA’s walls.
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Acknowledgments |
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This work was supported by VA Health Services (grants ACC 01-117, IIR 04-236, and REA 03-098).
Note. The views expressed in this article do not necessarily represent the views of the Department of Veterans Affairs or of the US Government.
Human Participant Protection
This study was approved by Dartmouth Medical School’s Committee for the Protection of Human Subjects.
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Footnotes |
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Peer Reviewed
Contributors
W. B. Weeks originated the study and supervised all aspects of its implementation. A. N. West, A. E. Wallace, and R. E. Lee assisted with the study, completed or assisted with the analyses, and made substantial contributions to the article’s content. D. C. Goodman and J. B. Dimick conducted specific analyses necessary for completing the study. J. P. Bagian helped develop the study conceptually and assisted with policy implication development.
Accepted for publication June 22, 2007.
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References |
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TOPABSTRACTINTRODUCTIONMETHODSRESULTSDISCUSSIONReferences |
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