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Doctors and hospitals that treat poor are unfairly penalized, panel says

  • Article by: ROBERT PEAR
  • New York Times
  • April 27, 2014 - 9:28 PM

Federal policies to reward high-quality health care are unfairly penalizing doctors and hospitals that treat large numbers of poor people, according to a new report commissioned by the Obama administration that recommends sweeping changes in payment policy.

Medicare and private insurers are increasingly paying health care providers according to their performance as measured by the quality of the care they provide. But, the draft report by an expert panel says the measures of quality are fundamentally flawed because they do not recognize that it is often harder to achieve success when treating people who do not have much income or education.

Low-income people may be unable to afford needed medications or transportation to doctor’s offices and clinics, the panel said. If they have low levels of formal education or literacy, they may have difficulty understanding or following written instructions for home care and the use of medicine. In addition, the clinics and hospitals they use may lack the resources and high-tech equipment needed to diagnose and treat illnesses.

‘Sociodemographic factors’

The panel found that existing payment policies unintentionally worsen disparities between rich and poor by shifting money away from doctors and hospitals that care for “disadvantaged patients.”

Measures of health care quality and performance — widely used by Medicare and private insurers in calculating financial rewards and penalties — should be adjusted for various “sociodemographic factors,” said the expert panel, created by the National Quality Forum, an influential nonprofit, nonpartisan organization that endorses health care standards.

“Factors far outside the control of a doctor or hospital — patients’ income, housing, education, even race — can significantly affect patient health, health care and providers’ performance scores,” said Christine Cassel, the president of the quality forum.

President Obama’s administration commissioned the study, but is not entirely comfortable with the recommendations, officials acknowledged. The existing policies of the quality forum and the government say that performance scores should generally not be adjusted or corrected to reflect differences in the income, race or socioeconomic status of patients.

Disparities in access to care

Steven H. Lipstein, the president of BJC HealthCare in St. Louis and a member of the panel, said: “The administration’s current policy on adjustments for socioeconomic status are quite inadvertently exacerbating disparities in access to medical care for poor people who live in isolated neighborhoods. I’m sure that’s not what President Obama intended with the Affordable Care Act.”

The 26-member panel said that policymakers who devise or use performance measures should “assess the potential impact on disadvantaged patient populations and the providers serving them,” to avoid hurting “safety net providers.”

Many provisions of the 2010 health law seek to improve care by tying Medicare payments to the performance of doctors, hospitals, nursing homes and health plans. Medicare, for example, is reducing payments to hospitals where an above-average share of patients return within a month of being treated and discharged.

But for hospitals with large numbers of poor patients, the panel said, such financial penalties are unfair because “readmissions are difficult to avoid in patients who can’t afford post-discharge medications, have no social support to help with recovery at home, have no way to get to follow-up doctor appointments, or are homeless.”

Skewed evaluations

Two doctors or hospitals that provide the same high-quality care may get very different outcomes if one has mostly low-income patients and the other serves a more affluent population, the panel said.

Using the raw data, without any adjustment for poverty or other demographic factors, “can lead to incorrect inferences about quality” and “provides the public, including patients, with misleading measures of performance,” it said. “Providers with a disproportionate share of disadvantaged patients will appear to provide lower quality care than they actually do, and vice versa.”

In existing pay-for-performance programs, the panel said, doctors and hospitals serving poor people are more likely to be identified as “poor performers” and to face financial penalties. The penalties deprive these providers of the resources they need to improve care, and “it is ultimately the patients who suffer,” it said.

Helen Burstin, a senior vice president of the quality forum, said that the endorsement of performance measures “has become increasingly controversial over the issue of whether to adjust for socioeconomic status.”

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