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AQA Invitational Meeting

CMS Perspective

Mark McClellan, Centers for Medicare & Medicaid Services (CMS)

Mark McClellan said that now is the time to make progress in using quality measurements to get a better health care system. He said that stakeholders are getting behind the effort to put in place performance measures for ambulatory care, and said that it was time to collaborate more closely than ever to make quality improvements and close the quality gap. He warned, however, that if you cannot measure quality, it will be hard to achieve a system that rewards quality care.

McClellan committed to taking a leadership role in working with key stakeholders to push forward with ambulatory performance measures, and his remarks focused on CMS' goals and activities in this arena. He noted that the Medicare Modernization Act gave the agency new tools, including purchasing power. At the same time, he said, there are better ideas floating around today and better support than ever for quality improvement efforts based on quality measurements—and even pay for performance.

The goal to improve quality and safety underlies all of our goals, stressed McClellan. He noted the urgent need for more broadly accepted quality measures that are results-oriented. He also noted that despite many advances in technology and medical science, the American health care system too often fails to translate these efforts into better patient care. Too many patients receive the wrong treatments or fail to receive the right ones, said McClellan. He added that we need a better strategy to come up with innovative, high-quality care—and ways for delivering this care.

McClellan stressed that the tools exist now to put in place better medical practices and to provide every patient the right care at the right time. The goal is a "patient-centered, personalized, equitable, safe, quality care system," he said.

McClellan pointed to the work of the CMS Quality Council, which includes four working groups. The Quality Council is designed to give patients and providers the tools they need to make the best decisions, he said. It also strives to ensure that we have an environment for medical practice that supports the best use of these tools (including information technology tools and information on effectiveness of treatment options and effectiveness of provider performance). One working group is focused on performance measurement, including the possibility of pay for performance, he added.

The CMS administrator said that it was very important to have in place a collaborative process in order to get to a common set of meaningful and valid ambulatory care measures that are outcomes-oriented. He noted that the NQF has played an important role in helping to establish a consensus process, adding that the NQF is currently conducting a review of the effectiveness of ambulatory care measures. McClellan stressed that CMS is supporting the refinement of these measures.

Next, McClellan cited some of the challenges ahead. These include:

  • Development of the data for the measures themselves (and he noted the debate on the use of claims-based data).
  • Questions about funding and ownership of measures (which he said he thought were really about providing adequate financial support).
  • Privacy questions (he noted the need to ensure the privacy of patient data) and the need to look at secure data measures.
  • Technical issues regarding the development of reliable and valid measures (he suggested that there would be a robust starter set in each of the specialties by next year).

Noting that addressing these challenges would be hard work, McClellan expressed confidence that progress on performance measurement in the ambulatory care area was achievable. He pointed to the broad alliance that came together to make progress in the hospital arena. McClellan noted that CMS has used a variety of tools to standardize reporting requirements and to prioritize and standardize quality measures for hospitals. As a result of these efforts, he said, there is now voluntary reporting on 10 starter measures for all patients being treated for three common health problems.

We want to emulate this collaboration with the active involvement of all key stakeholders in the ambulatory care arena, said McClellan. We need your help, and we hope we can start today, he said.

While CMS wants broad stakeholder input, McClellan stressed that the agency was going to keep moving forward on its own with pilot programs. He cited as one example a Medicare pilot program on fee-for-service chronic care coordination, in which the agency will pay physicians for improving quality and lowering costs at the same time. In other words, CMS will pay for sharing the gains that will come from more efficiency within the system, he said.

We are also pushing forward on other ambulatory care demonstrations, said McClellan. This includes a Medicare performance demonstration in which physicians are given incentives to put in place new information technology, including health information technology, and to make improvements in quality. The program thus rewards better quality of care and improvements in health outcomes. Another pilot project incorporates a subset of the ambulatory care measures in a pay-for-performance demonstration that rewards large practices that are able to influence services and improve health outcomes. The practices will receive bonuses if they save Medicare money while at the same time improving quality of care and health outcomes.

In concluding his remarks, McClellan reiterated that he would like to see the establishment of an alliance of key stakeholders in ambulatory care around initiatives that encourage and reward improvements in health outcomes and quality of care. "As we strive to make improvements," he said, "I believe there are opportunities to provide better support and an environment that encourages us to get it right the first time."


During the discussion that followed, someone asked McClellan about his top three priorities for getting started. He cited three items:

  • Providers must be at the table (he also noted that providers are tired of facing cuts in Medicare payments and want the flexibility to be innovative).
  • All key stakeholders, including consumers, must be at the table and ready to agree to reward, encourage, and even pay for better results.
  • Stakeholders must have a concrete goal.

There was also a question about how CMS was addressing the problem of a "dysfunctional payment system" that does not reward outcomes or improvements in quality. How is CMS looking at the issue of pay-for-performance incentives and fee for service?

It is too often the case that the providers who know most about how to improve care are feeling frustrated, said McClellan, because they are swimming against the tide in an environment that pays hospitals and physicians more when they have complications and dispense more care. He said the problem right now is that higher quality means fewer dollars for hospitals and other health care providers. He said that while the CMS demonstration projects are fairly modest, they should offer some guidance on what does and does not work.

McClellan added that a major change within Medicare is the availability of more preferred provider organization (PPO) plans, which offer the opportunity to lower costs and coordinate care more effectively. He said CMS was looking to expand its PPO offerings in the next year, especially as the agency moves to a system that will support the use of PPOs at the regional level. At the same time, he once again emphasized that without meaningful ways to measure how well the system is doing, it will be very hard to support and reward improvements in quality of care.

Finally, there was a question about the accessibility of Medicare data and whether it could be merged with other data sources. McClellan noted that there were currently real limitations on his agency's ability to share patient-level data. But this is not insurmountable, he said. He noted that CMS was looking at the use of aggregated data. McClellan added that it was necessary to find ways to either get rid of the need for patient-level data or ways to ensure its protection—and he asked meeting participants for their help in addressing this problem.

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