General Business Issues

Insurers Design Pay-for-Performance Measures to Halt the Spread of the Increasingly Common, Potentially Fatal MRSA Infection

Reprinted from HEALTH PLAN WEEK (formerly Managed Care Week), the industry's leading source of business, financial and regulatory news of health plans, PPOs and POS plans.

The potentially fatal infection Methicillin-resistant Staphylococcus aureus (MRSA) is far more common than previously thought, according to a new study and recent news reports. In an effort to boost prevention and detection, a few insurers — including Highmark Inc. and Horizon Blue Cross Blue Shield of New Jersey — are incorporating MRSA-related measures into their hospital pay-for-performance (P4P) programs to incentivize hospitals to institute prevention efforts.

A study conducted by the Centers for Disease Control and Prevention (CDC) and published in the Oct. 17 issue of the Journal of the American Medical Association estimated that 94,360 invasive MRSA infections occurred in the U.S. in 2005, resulting in death in almost 20% of cases.

The new estimate, based on active case findings, is far higher than a previous projection from the CDC, which in 2000 used hospital discharge data to estimate 31,400 hospitalizations for MRSA.

Although many patients contract MRSA in hospitals and other health care institutions, community-acquired MRSA also is growing more common — with numerous cases and a few deaths reported among students across the country.

Only recently have hospitals begun taking steps to prevent MRSA, says Michael Madden, M.D., Highmark's medical director for medical performance management. "Historically, medicine thought of this as, 'Well, it's the cost of doing business.'"

But in December 2006, the Institute for Healthcare Improvement (IHI) added the reduction of MRSA infection to its new 5 Million Lives campaign. Participating hospitals submit such data as the percentage of patients who were tested for MRSA on admission and compliance with prevention techniques such as hand washing, room cleaning and proper use of gloves and gowns.

IHI measures are easily incorporated into health plans' P4P programs — and provide a way to defray hospitals' expenses for MRSA prevention programs. "Now that we have it as part of our [P4P] program, that issue is taken off the table for our providers, so we're seeing much wider adoption in our participating hospitals," Madden says.

He adds that he believes the Highmark MRSA program is a model. "There are not many insurers around the country that are encouraging this level of collaboration in this area," Madden asserts.

Highmark Mandates MRSA Prevention

Highmark's hospital P4P program requires participating hospitals to measure and report improvements on two mandatory hospital infection measures: MRSA and central line-associated bloodstream infections. Hospitals also select two additional measures from a list of available options such as improvements in medical-technology adoption and surgical care.

The program initially was operated only in western Pennsylvania, but Highmark expanded it to the central Pennsylvania region this year. During annual contract negotiations, Highmark agrees upon a targeted improvement level and bonus payment with each hospital. Because it's part of the contract, Madden declines to specify actual bonus amounts. But, he says, "it's enough to get their attention. Over time, they have turned the quality-control and infection-control departments from cost centers to revenue centers."

For the MRSA standard, hospitals must report two pieces of data to Highmark. First, it must report the percentage of patients in high-risk areas such as intensive care units who have MRSA upon admission, either by performing a nasal culture as a screening tool, or by reviewing the patient record to see if they have any history of MRSA.

About 8.4% of patients in these areas are found to have MRSA on admission, Madden says. "That rate is about twice what they thought it was without screening," he adds, explaining that performing a nasal swab on patients with no prior history of MRSA roughly doubles the number of patients found to have the infection.

Second, hospitals must perform the same screening procedures on discharge and report the percentage to Highmark. Madden says 1.9% of patients who did not have MRSA on admission contracted it before being discharged.

Hospitals also must adopt a series of preventive measures, such as isolating patients who have MRSA infections and using separate equipment for those patients. Caregivers also must follow hygiene guidelines, such as washing hands before and after patient contact and disposing of gloves and gowns after caring for a patient who has MRSA.

Hospitals Need Not Show Improvement

For now, Highmark isn't requiring hospitals to show a reduction in infection rates, Madden says. "That gets more complicated, based on what was their rate of infection on admission and the relative illness of the patients involved," he explains. "So our focus now is really assuring that they culture everybody on admission and they culture everybody on discharge and that they're ensuring that they are doing good isolation techniques."

Some hospitals, for example, have established "secret shopper"-style programs to observe caregivers' hygiene practices and ensure that guidelines are being followed appropriately, Madden says.

Horizon Requires Infection Reduction

Horizon is adding two MRSA prevention measures to its Horizon Hospital Recognition Program starting in 2008: performance on the set of indicators developed by IHI, and participation in a program operated by the New Jersey Infection Prevention Partnership, an alliance of New Jersey hospitals, Horizon and MedMined, which is a data-mining technology and service vendor that is a subsidiary of Cardinal Health, Inc.

The partnership uses data-mining and surveillance technology to detect a variety of hospital-acquired infections, including MRSA, says Bill Finck, Horizon's director of network initiatives.

The resulting data is supplied to hospital-infection control staff members, who use it to target prevention and education efforts to specific hospital areas where infection transfer is occurring.

"In hospitals where they have implemented the program, they've seen on average a 10% reduction in the incidence of hospital-acquired infections, to include MRSA," Finck says.

For the IHI measure set, hospitals are rewarded on the basis of whether they can show a significant reduction in the incidence of hospital-acquired MRSA infections.

Horizon's full network of 66 hospitals will participate in the program in 2008, up from 11 hospitals in 2005 and 23 hospitals in 2007. For the 2006 program year, Horizon's total bonus payout was almost $6 million, with that figure rising to about $6.5 million in 2007, Finck says. He concedes that the dollar amount "is not terribly significant per hospital….But it is enough to do two things. First of all, it covers the cost of compliance with all these new obligations. But secondly it's public recognition that the hospital is achieving increased quality."

Insurers Differ on 'Never Events'

The insurers differ on whether MRSA infections should be included on the list of so-called "never events," or preventable errors such as falls or surgery on the wrong body part. CMS said in August that it would stop paying for such medical costs.

Madden contends that "it's a bit early in the analysis and study of the success of these kinds of programs to say that a MRSA infection is a never event yet." But, he adds, "we may end up being there eventually."

By contrast, Finck says Horizon may add MRSA to a list of never events at some point. He adds that the biggest challenge is administrative. CMS pays hospitals on a DRG basis, so it is simpler for Medicare to refuse to pay for an increase in DRG payments triggered by a complication or comorbidity caused by a never event.

But Horizon reimburses hospitals on a per diem basis, "so we'd have to look for those days that were caused by an infection or MRSA or a fall or something, and identify those days and not pay for them."

He adds that hospital-acquired infections eventually may pose a compliance issue for hospitals, particularly those that use targeted surveillance techniques that test for infections only when prompted by patients' symptoms or history. "As a result of not knowing [which patients get hospital-acquired infections], the potential exists to bill Medicare for complications."

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