Paying for an outcome, not a procedure

Summary: Adoption of Pay-for-Performance principles in wound care leaves the realm of the theoretical and finally becomes the realm of practicing first adopters.

Pay-for-performance, outcomes-based medicine, evidence-based clinical practice–is coming to healthcare.

How many times have you heard one of those statements and wondered, “When is it coming? How will it happen? What will it look like when it gets here?” Given all the talk surrounding pay-for-performance, it is appropriate to wonder when the principles of pay-for performance will stop being theory and start being practice.

About pay-for performance, Center for Medicare and Medicaid Services (CMS) states:

Medicare has various initiatives to encourage improved quality of care in all health care settings where Medicare beneficiaries receive their health care services, including physicians’ offices and ambulatory care facilities, hospitals, nursing homes, home health care agencies and dialysis facilities. [Source]

The popular reference site Wikipedia states:

Also known as "P4P" or “value-based purchasing,” this payment model rewards physicians, hospitals, medical groups, and other healthcare providers for meeting certain performance measures for quality and efficiency. Disincentives, such as eliminating payments for negative consequences of care (medical errors) or increased costs, have also been proposed. In the developed nations, the rapidly aging population and rising health care costs have recently brought P4P to the forefront of health policy discussions. [Source]

Further supporting the trend toward P4P, in February 2009, the American Recovery and Reinvestment Act (Stimulus package) was passed with tens of billions of dollars allocated to research in health care outcomes and for systems that can provide data supporting collection and reporting of outcomes in healthcare. The trend occurs at the state as well as the federal level. In 2006, for example, the State of Minnesota announced a program of grants to reward nursing homes and home health agencies for improvements in both the cost and the quality of the services they provide. The initiative was dubbed “PIP,”an acronym for performance incentive payment program.

Even as these widely reported stories and initiatives have spread throughout the culture of healthcare, some businesses and corporations have been developing programs that actually allow individuals and practitioners to access healing processes, tools and technologies that comprise the outcomes-driven principles of pay-for-performance.

Advanced Healing Systems, one of those organizations, has created an outcomes-driven model adopted initially by the long-term care industry, but which is currently under consideration by multiple provider and payor types across all channels of the health care industry. The focus of Advanced Healing Systems Pay-for Performance model is wounds, because unlike many other conditions requiring care, the healthcare system currently has all the tools it needs to evaluate outcomes in wound care. Aligned properly via Advanced Healing Systems’ Wound Care Formulary, adoption of Pay-for-Performance in wound care leaves the realm of the theoretical and finally becomes the realm of practicing first adopters.

When tissue breaks down or is compromised, regardless of the reason it happened, there is an obvious way to tell that an event happened – a wound that requires care. When the body has healed itself with the help of the best adjunctive technologies and when that progress is documented via an online reporting system that captures written and photographic evidence of changes over time, there is a clear point at which the event – the wound – has successfully resolved.

Within the healthcare system, there exists significant historical data to support times to heal and costs to heal for wounds. New wounds can and should be tracked, and new technologies can be measured against historical data to show whether or not those technologies have reduced time to heal and reduced cost to heal.

AHS’ Formulary provides its partners with all the necessary tools to drive superior health and financial outcomes. Due to the nature of its construction and ongoing monitoring, it will also enable its partners to evaluate new wound care tools or modalities and can justify the adoption of the new tool if it does one of three things: reduce time to heal, reduce cost to heal or both.

A program with tools designed to function according to those parameters is the essence of an outcomes-based, pay for performance program.