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Exhibit U. Detail of Performance Analysis
Reduce the risk of harm from health care services by promoting the delivery of appropriate care that achieves the best quality outcome.
Increasing the safety and quality of health care for all Americans is a primary emphasis at
AHRQ. Patient safety was quickly elevated to national importance in November 1999, when the
Institute of Medicine's report, To Err is Human: Building a Safer Health System, estimated that
between 44,000 and 98,000 Americans die each year as a result of medical errors. Almost
immediately, the Senate Committee on Appropriations began hearings on patient safety issues
that resulted in the Committee directing AHRQ to lead the national effort to combat medical
errors and improve the quality and safety of patient care. One of AHRQ's leading long-term
goals is to prevent, mitigate and decrease the number of errors, risks, hazards and quality gaps
associated with health care and their harmful impact on patients.
Consequently, safety and quality are of the highest priorities within AHRQ. Leaders of our
health care system have demonstrated a commitment to improve the quality and safety of care
for all Americans, and with their help, AHRQ has successfully built the foundation for a national
Patient Safety Initiative. The mission of this agency-wide strategic goal is to reduce the risk of
harm from health care services by promoting the delivery of appropriate care that achieves the
best quality outcome.
The results of investments in patient safety and quality are now being incorporated into practice.
Below are examples of how this work is being used.
- Through the first year of the Patient Safety Improvement Corps, AHRQ has trained more than 50 patient safety experts representing 15 States and 13 hospitals/major health care organizations in the use of tools and techniques to analyze health care related errors, risks, and hazards; identify and understand their root causes; and identify and implement effective, evidence-based interventions to make the delivery of health care safer.
- On behalf of the HHS Patient Safety Task Force (PSTF), AHRQ contracted with the Keveric Company, and they have developed a data repository and vocabulary server designed to enhance the functionality of reported medical error event data.
- Through 2004, AHRQ continued support of a monthly peer-reviewed, Web-based journal that showcases patient safety lessons drawn from near misses and actual cases of medical errors called the AHRQ WebM&M (Morbidity and Mortality Rounds on the Web, http://webmm.ahrq.gov).
- On December 22, 2003 AHRQ released the National Healthcare Quality Report (NHQR) and the National Healthcare Disparities Report (NHQR). These two reports represent the first national comprehensive effort to measure the quality of health care in America and differences in access to health care services for priority populations. AHRQ Quality Indicators (QIs) are being used by a variety of organizations in a number of ways, including for internal hospital quality improvement, public reporting by hospitals, and private and public national pay-for-performance initiatives and demonstrations. Following are some examples:
- Many State and regional hospital associations across the nation have integrated the Inpatient
Quality Indicators (IQIs) and the Patient Safety Indicators (PSIs) into their quality programs and
performance measurement systems. Some of these associations include the Healthcare Association of
New York State, the Missouri Hospital Association, the Georgia Hospital Association, and the
Dallas-Fort Worth Hospital Council.
- A private pay-for-performance initiative that uses the AHRQ QIs is the Anthem Blue Cross Blue
Shield of Virginia Quality-In-Sights® Hospital Incentive Program. It is designed to align
financial incentives with achievement of specific performance objectives, and includes a patient
safety component that relies on the PSIs for monitoring.
- A public pay-for-performance demonstration is the CMS-supported Premier Hospital Quality
Incentive Demonstration, a 3-year project to recognize and provide financial rewards to hospitals
that demonstrate a high quality performance. CMS seeks significant improvement in the quality of
inpatient care by awarding bonus payments to hospitals with high quality as measured by multiple
performance measures in the acute care area, including two of the AHRQ PSIs.
- The AHRQ health IT initiatives include a series of three solicitations issued in FY 2004. The solicitations form an integrated set of activities designed to explore strategies for successful planning and implementation of health IT solutions in communities and to demonstrate the value of health IT in patient safety, quality, and health care costs.
- Adoption of beneficial and timely clinical preventive recommendations is a measure of the Prevention Portfolio's effectiveness. This evidence-based knowledge is generated by the U.S. Preventive Services Task Force (USPSTF). The Task Force is an independent panel of experts in primary care and prevention that systematically reviews the evidence of effectiveness and develops recommendations for clinical preventive services. By identifying how these guidelines can improve the delivery of effective health care, the Prevention Portfolio can facilitate the adoption of the Task Force recommendations among partnership organizations. This process supports the FY 2006 prevention portfolio objective of "increasing the number of partnerships that will adopt and promote evidence-based clinical prevention."
In FY 2004, as a result of the PART review, AHRQ's pharmaceutical outcomes portfolio adopted
a goal of reducing hospitalizations for upper gastrointestinal bleeding due to the adverse effects
of medication or inappropriate treatment of peptic ulcer disease, in those between 65 and 85
years of age. Hospitalization rates for GI bleeding should improve with upcoming portfolio
involvement in the following areas:
- Enhancing strategies in effectively facilitating the adoption and implementation of evidence-based guidelines and educational programs related to osteoarthritis that recommend acetaminophen-based regimens, which are safer and often as effective as NSAIDs.
- Second, anticoagulants are commonly used for the prevention of stroke. These products, although valuable, require close monitoring via frequent lab tests. In the absence of this monitoring, these patients also may experience bleeding episodes.
- Finally, the diagnosis and treatment of ulcer disease has improved with the discovery that ulcer disease is caused by infection due to the bacteria H. Pylori. Appropriate diagnosis and treatment of this organism should reduce the sequelae of ulcer disease and bleeding.
Achieve wider access to effective health care services and reduce health care costs.
American health care should provide services of the highest quality, with the best possible
outcomes, at the lowest possible cost. Striving to reach this ideal is a primary emphasis of
AHRQ's mission with many of its activities directed at improving efficiency through the design of
systems that assure safe and effective treatment and reduce waste and cost. The driving force
of this agency-wide strategic goal is to promote the best possible medical outcomes for every
patient at the lowest possible cost.
A significant factor that reduces the efficiency of our modern-day health care system is waste
caused by systems that do things that don't improve care, processes that could be designed to
do things better and systems that fail to do things that would assure more effective treatment.
AHRQ's investments include efforts to develop ways to (1) measure and report on the efficiency
of systems, procedures, and processes, (2) assess the scope, nature, and impact of waste in
health care systems, and (3) design techniques, methods, and technology to improve treatment
outcomes and reduce associated costs.
AHRQ's Medical Expenditure Panel Survey (MEPS) is the only national source for annual data
on the specific health services that Americans use, how frequently the services are used, the
cost of the services, and the methods of paying for these services. MEPS data have been used
by researchers both within and outside the Federal Government to examine issues of
importance to policymakers, consumers, and providers.
- The MEPS has been used to estimate the impact of the recently passed Medicare Modernization Act (MMA) by the Employee Benefit Research Institute (the effect of the MMA on availability of retiree coverage), by the Iowa Rural Policy Institute (effect of the MMA on rural elderly) and by researchers to examine levels of spending and copayments (Curtis et al, Medical Care, 2004).
- The MEPS has been used in congressional testimony on the impact of health insurance coverage rate increases on small businesses.
- The MEPS-IC has been used by a number of States in evaluating their own private insurance issues including eligibility and enrollment by the State of Connecticut; and community rating by the State of New York. As part of the Robert Wood Johnson Foundation's State Coverage Initiative, MEPS data was cited in 69 reports, representing 27 states.
- MEPS data have been used in DHHS Reports to Congress on expenditures by sources of payment for individuals afflicted by conditions that include acute respiratory distress syndrome, arthritis, cancer, chronic obstructive pulmonary disease, depression, diabetes, and heart disease.
- MEPS data are used to develop estimates provided in the Consumers Checkbook Guide to Health Plans, of expected out of pocket costs (premiums, deductibles and copays) for Federal employees and retirees for their health care. The Checkbook is an annual publication that provides comparative information on the health insurance choices offered to Federal workers and retirees.
- MEPS data has been extensively used to examine the pharmacological treatment of many conditions including depression (in both adults and children), back pain, ADHD, obesity, hypertension and cardiovascular diseases.
- MEPS data has been used by CDC and others to evaluate the cost of common conditions including arthritis, injuries, diabetes and cancer.
- MEPS data has been used to examine quality of care, including the receipt of preventive care and barriers to that receipt.
Our Prevention Portfolio is seeking to support the goal of efficiency by creating the ability to
provide timely knowledge of clinical prevention that can promote wider access to effective health
care services and thus reduce health care costs. The United States Preventive Services Task
Force (USPSTF) generates evidence-based recommendations on clinical preventive services
based on the benefits and harms to the patient. These recommendations can guide others in
prioritizing resources for clinical prevention that could lead to increased access and decreased
cots. By "increasing the timeliness and responsiveness of the USPSTF to emerging needs in
clinical prevention," the Prevention Portfolio can support the Agency's overall goal of efficiency.
Within the pharmaceutical outcomes portfolio, trend analysis and baseline measures have been
developed through the use of MEPS and HCUP and in consultation with the AHRQ research
community. As a result of this planning and evaluation activity, all relevant AHRQ-funded
activities have been compiled and summarized and ten-year goals for improvement have been
established. Work with partners is planned to support the achievement of these targets. Work
is ongoing for the development of an efficiency goal related to improved prevention of rehospitalization
for congestive heart failure.
Assure that providers and consumers/patients use beneficial and timely health care information to make informed decisions/choices.
To assure the effectiveness of health care research and information is to assure that it leads to
the intended and expected desirable outcomes. Supporting activities that improve the
effectiveness of American health care is one of AHRQ's strategic goals. Assuring that providers
and consumers get appropriate and timely health care information and treatment choices are
key activities supporting that goal.
One significant AHRQ investment focuses on how best to define and measure the effectiveness
of health care services. Other areas of work focus on disease prevention and assuring that
health care providers and consumers have the information they need to adopt healthy life styles.
Additional AHRQ efforts include providing reliable information when health care providers and
patients must consider the relative effectiveness of various treatment protocols and the
appropriateness of alternative pharmaceutical choices. Following is more specific information
on these program areas:
CAHPS® initially stood for the Consumer Assessment of Health Plans. However, in the current
CAHPS® program—known as CAHPS II—the products have evolved beyond health plans.
CAHPS® is an easy-to-use kit of survey and reporting tools that provides reliable information to
help consumers and purchasers assess and choose among health plans, providers, hospitals
and other health care facilities. Data are provided from CAHPS® surveys that measure the
consumers' perspective on their health care. The CAHPS® team and AHRQ work closely with the health care industry and consumers to ensure that the CAHPS® tools are useful to both
individual consumers and to employers and other institutional purchasers of health plans.
The Healthcare Cost and Utilization Project (HCUP) is a family of health care databases and related
software tools and products developed through a Federal-State-Industry partnership. HCUP
databases bring together the data collection efforts of State data organizations, hospital
associations, private data organizations, and the Federal government to create a national
information resource of patient-level health care data. HCUP includes the largest collection of
longitudinal hospital care data in the United States, with all-payer, encounter-level information
beginning in 1988. These databases enable research on a broad range of health policy issues,
including cost and quality of health services, medical practice patterns, access to health care
programs, and outcomes of treatments at the national, State, and local market levels.
Americans die prematurely every year as a result of diseases that often are preventable, such
as heart disease, diabetes, some cancers, and HIV/AIDS. To address these issues, AHRQ
convenes the U.S. Preventive Services Task Force, an independent panel of experts in primary
health care and prevention. The mission of the task force is to conduct comprehensive
assessments of a wide range of preventive services to include screening tests, counseling
activities, immunizations, and preventive therapies. Recommendations about which services
should be provided routinely as part of primary health care are made based on these
assessments. The evidence-based recommendations developed by the Task Force are then
used by a diverse audience interested in clinical prevention.
The appropriate use of pharmaceutical agents is critical to effective, high quality, affordable
health care. Understanding which agents work, for which patients, and at what cost, can inform
programs to manage the selection, utilization, and cost of pharmaceutical therapies and
services within a changing health care environment. Since 1992, AHRQ has funded
pharmaceutical research. Our studies focused on patient outcomes related to medications,
medication safety, strategies intended to improve the efficiency of drug use, and ways to control
medication costs. Findings from AHRQ pharmaceutical research projects have yielded
important insights for the health care system. Some key issues and recent findings from our
- ACE inhibitors and beta-blockers reduce deaths in a broad range of patients with heart disease.
- Antibiotic use by U.S. children fell by almost 25 percent from 1996 to 2000, and more than half of the decrease came from decreased use of antibiotics for ear infections.
Develop Efficient and Responsive Business Processes
AHRQ has instituted a systematic approach to addressing and implementing the President's Management Agenda. The five government-wide agenda reforms—Strategic Management of Human Capital; Competitive Sourcing; Improve Financial Performance; Budget and Performance Integration; and Expanding Electronic Government—are teamed with other program reforms with which the Department has been charged. In a realignment announced in May 2003, the AHRQ Director created a new organizational entity—an Office of Performance, Accountability, Resources and Technology—to better manage the Agency's progress against these reforms as well as other management initiatives that cross-cut Agency components.
Over the past year, AHRQ has taken advantage of automation to streamline processes and
increase efficiency where feasible. Examples include:
- Automating the annual OGE 450 (Confidential Financial Disclosure Report) filing process. Instead of sending each employee a paper copy of the required memo and OGE-450, employees are notified via e-mail of the reporting requirements as well as link to the on-line form and accompanying instructions. This reduces staff time needed to create the documents, collate, and disseminate to staff.
- AHRQ staff is systematically being trained on the "sign in" and "sign out" feature of the Integrated Time and Attendance System (ITAS). This will allow employees greater control over their time and attendance reporting and will allow us to reduce the number of timekeepers from 14 to three.
- Ninety percent of Agency vacancies are filled through the automated QuickHire staffing mechanism. This has reduced the amount of paperwork generated for each announcement and also created a standardized approach to recruiting positions.
- AHRQ has begun deploying the Enterprise Human Resource Program (EHRP) to select Offices and Centers in AHRQ. This allows designated staff to independently generate documents (e.g., award nomination forms, SF-52 [Request for Personnel Action]) without having to contact either the Rockville HR Center or program staff in the Office of Performance, Accountability, Resources and Technology (OPART) for HR-related information (e.g., position title, series, grade, salary, etc.). In FY 2005, AHRQ will begin the process of using the automated SF-52 process in select Offices/Center. This will minimize the number of people involved in the routing/clearance of an SF-52.
In FY 2003, AHRQ conducted eleven streamlined competitive sourcing studies in the functional
areas of accounting, visual information, program/management analysis, information technology,
and program assistance. The performance decision for each of these studies was in favor of
the agency. In FY 2004, AHRQ conducted a streamlined (with MEO) competitive sourcing
study in the functional area of secretarial/program assistance. This study encompassed 20
FTEs and the performance decision made was for the agency, which utilized a Most Efficient
Organization. The Most Efficient Organization is in the process of being staffed and
AHRQ's major activities regarding the integration and implementation of the President's
Management Agenda (PMA) through e-Government technologies within the Agency include:
- Government Paperwork Elimination Act (GPEA).
- Full participation in HHS PMA activities that intersect with the mission of the Agency, Patient
Safety, and Consolidated Health Informatics initiatives that cross Government Agency boundaries.
In line with these program initiatives, AHRQ's Information Technology (IT) services team
explicitly defined its mission and vision, buttressed by three strategic goals:
- Provide quality customer service to AHRQ developed applications and operations support to AHRQ's centers, offices and outside stakeholders.
- Ensure AHRQ's IT initiatives are aligned with departmental and agency enterprise architectures.
- Ongoing development of IT systems that link AHRQ's IT initiatives directly to the mission and performance goals of the Agency by developing an electronic planning system that allows selection and tracking of business investments (Grants, Contracts and Intramural research) that link directly to the Agency mission and GPRA goals and budget performance.
Financial accountability is a cornerstone of the "Improved Financial Performance" initiative of the President's Management Agenda. Federal managers continue to experience growing pressures from their executive leaders, Congress, the public, and their customers to achieve more under the programs they manage. To that end, this initiative asks agencies to evaluate their financial management capabilities to ascertain if sufficient internal controls are in place to safeguard against the misuse of federal funds, and to ensure that these controls provide the accountability required to make certain funds are spent as intended. The essential goal of this initiative is for managers to have access to and use financial information to make informed program and management decisions on a "day to day" basis. The following highlights AHRQ's progress on the "Improved Financial Performance" goal for the President's Management Agenda.
AHRQ submitted its Improper Payment Risk Assessment in accordance with the Improper
Payment Information Act (IPIA) of 2002 to the Department in FY 2004. This assessment looks
at whether AHRQ's Research on Healthcare Costs, Quality and Outcomes (HCQO) program
activities are susceptible to significant erroneous payments. The report focuses on identifying
the types of erroneous payments (i.e., whether the errors are administrative in nature such as
user errors or are due to system/process limitations, as opposed to the more consequential
causes such as lack of internal controls, oversight, and/or monitoring; inadequate eligibility
controls; and fraud, waste and abuse) and evaluating the related internal controls. The report
offers the opinion that AHRQ's HCQO program is at low risk of incurring significant erroneous
AHRQ continues to gather evidence of erroneous payments encountered by using a standard
form to pinpoint their exact nature and extent. The information collected will be evaluated in
November, and used to determine what corrective action is appropriate.
AHRQ responded to the Department's survey requesting information on how/if the Agency uses
performance and financial information on a day to day basis to support routine decisions. The
purpose of the survey was to highlight the best practices already in place and to identify areas
for improvement, with the ultimate goal of enhancing the utility of the Unified Financial
Management System (UFMS) once implemented. AHRQ's responses included examples of:
efficiency measures in our current Performance Plan, financial and performance reports used by
managers to support management decisions, actions/decisions made based on performance
and financial data, and how efficiency measures are integrated into senior management's
individual performance plans.
AHRQ continued to support the Department's efforts to develop and implement UFMS by
participating in the Steering Committee and the Planning and Development Committee
AHRQ continued to work on enhancing our information systems and developing new
applications to create an Agency-wide enterprise financial network to improve our access to
relevant programmatic and budgetary information. Our long-range plan is to interface AHRQ
systems with The Department's Unified Financial Management System (UFMS) to help
management substantially reduce the cost of providing accounting services through the
Department while enabling program administrators to make more timely and informed decisions
regarding their operations. AHRQ's automated system captures electronic funding decisions for
extramural research grants and ties financial resources to the Agency's strategic plan goals,
GPRA goals and measures, budget execution and formulation, and financial management
activities. The system interfaces with IMPAC II and interconnects with the existing Agency
budget system through a shared research/financial data base. Funding modules for contracts
and interagency agreements were tested and integrated into the system in the 3rd quarter of FY
2004. A module for capturing intramural research projects was also completed and put into
production in the 3rd quarter.
General program direction and budget and performance integration is accomplished through the
collaboration of the Office of the Director and the offices and centers that have programmatic
responsibility for portions of the Agency's research portfolio. The Agency links budget and
performance management through its focus on the Annual Performance Plan.
As a result of the increased emphasis on strategic planning, the Agency has shifted from a
focus on output and process measurement to a focus on outcome measures. These outcome
measures are being developed to cascade down from our strategic goal areas of safety/quality,
effectiveness, efficiency and organizational excellence. Portfolios of work (combinations of
activities that make up the bulk of our investments) support the achievement of our highest level
In continuing AHRQ's commitment to budget and performance integration, we reorganized the
management structure. This new structure aligns those who are responsible for budget
formulation, execution and providing services and guidance in all aspects of financial
management with those who are responsible for planning, performance measurement and
evaluation. These functions are now within one office.
Current and future efforts include continuing the development of a software application that
maps each AHRQ funded activity to the portfolio structure and associated performance. This is
a work in progress and we look forward to sharing our success as we continue this journey.
Finally, AHRQ completed comprehensive program assessments on five key programs within the
Agency: The Medical Expenditure Panel Survey (MEPS); the Healthcare Cost and Utilization
Project (HCUP); the Consumer Assessment of Healthcare Plans Survey (CAHPS®); the grant
component of the Agency's Translation of Research into Practice (TRIP) activity; and, the
Patient Safety program. The Pharmaceutical Outcomes Portfolio was the latest program to
undergo a PART review. These reviews provide the basis for the Agency to move forward in
more closely linking high quality outcomes with associated costs of programs. Over the next
few years, the Agency will focus on fully integrating financial management of these programs
with their performance.
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