A view from the Center


Deloitte's Life Sciences & Health Care Blog

Embracing ongoing change in hospital quality measurement

Winston Churchill is credited with saying that “to improve is to change, [but] to be perfect is to change often.” Organizations that hope to navigate uncertainty in health care might wish that the pace of change would slow – or disappear altogether. Unfortunately, neither of those scenarios is likely. If the last nine months are any indication, change will continue, and “often” will likely be the cadence.

Highlighting this trend of perpetual change is the US Centers for Medicare and Medicaid Services’ (CMS) recent decision to delay the release of its 2017 hospital star ratings. The ratings were originally due out in July, but the agency delayed them until October. Then, in late September, CMS announced that it would delay the ratings again as it continues to consider “potential changes to the star rating methodology based on public feedback.”

Indeed, CMS has received plenty of feedback on the Star Ratings Program since its inception. After the initial ratings release, many hospital leaders were surprised by their low scores and sought to better understand how the program works, and to determine how they might improve their ratings and the quality of the care they provide.

Deloitte examined the July 2016 star ratings in its recent report, “There’s more than one way to become a 5-star hospital.” In digging into the data and measures that comprise the ratings, we uncovered some interesting trends. For one, hospitals that earn a 5-star rating generally have better scores in the heavily weighted categories (i.e., mortality, patient experience, safety, and readmission). Moreover, variation in caseloads and the ability to report some measures appear to be tied to performance. Hospitals with smaller caseloads are sometimes missing data for many individual measures, or even entire categories. This variation in caseloads could be driving some of the differences in ratings. Regression analyses indicate that reporting on some quality measures is associated with star rating performance – even after controlling for hospital characteristics such as size, location, ownership, and case and payer mix.

Some hospitals might see the star-ratings delay as an excuse to shift focus away from outcomes measurement and quality improvement. I would caution them to consider the following:

  • Hospital quality measurement is going to continue: Consider the various other performance programs, such as the Hospital Inpatient Quality Reporting (IQR) Program and Hospital Outpatient Quality Reporting (OQR) Program. These programs continue to monitor hospital performance in key quality areas. And while CMS reviews and possibly updates the methodology for the Star Ratings Program, the agency’s Hospital Compare website displays the latest star-rating scores to help consumers shop for hospitals.
  • Focusing on quality can also improve the bottom line: For example, enhancements to the patient experience, one of the highly weighted categories in the Star Ratings Program as measured through the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey, can help a hospital improve its financial performance by strengthening customer loyalty, building reputation and brand, and boosting utilization of hospital services through increased referrals to family and friends.

As CMS evaluates its hospital quality rating program, hospital leaders should continue to drive their quality strategy by optimizing patient outcomes and experiences – areas that CMS consistently draws attention to through its various quality programs. The focus could be on broad quality performance improvement, rather than on one specific quality measure. Finally, a multi-pronged approach may be required, as CMS has once again indicated that it is willing to go back to the drawing board to make improvements to its quality measurement programs. Hospital executives should consider investing in technology and analytics tools to support their quality improvement goals while also developing and promoting a culture of quality improvement among leadership and individual clinicians.

Change is never easy. Perfection, especially in health care, is a worthy, but likely unattainable goal. But, I believe the most successful hospitals will be the ones who embrace change and do it often.

Author bio

David is a principal in Deloitte Consulting LLP’s Life Sciences and Health Care practice. He leads Deloitte’s Customer Transformation initiatives for the health care provider sector, and his work has focused on enhancing core operations in the revenue cycle, driving performance improvement through operating model transformation and growing the business through mergers & acquisitions all with an eye towards creating a more patient-centric, consumer-oriented delivery system.