key-311986_640Key Facts

Quality of care is a critical piece of the evolving healthcare environment. It is a major component of the Affordable Care Act of 2010. Much of the emphasis on quality being driven by the federal government is also carrying over into the commercial sector.


AHRQ – The Agency for Healthcare Research and Quality – defines quality as “Doing the right thing for the right patient, at the right time, in the right way to ensure the best possible result.” Quality measures are used to track many aspects of care delivery including medication adherence, care effectiveness, and utilization rates. These results are used to drive reimbursement rates to providers and health plans, based on the value they deliver to the patient.


key-311986_640Key Quality Rating Agencies

tree-576847_640The National Committee on Quality Assurance (NCQA) uses a variety of approaches to measure quality in a range of accreditation, certification, recognition, and performance measurement programs for different types of organizations, medical groups, and even individual physicians. NCQA’s programs are voluntary, yet the majority of health plans participate because organizations find value in the programs. Accredited health plans face a rigorous set of more than 60 standards and must report on their performance in more than 40 areas in order to earn NCQA’s seal of approval.


tree-576847_640The National Quality Forum (NQF) reviews, endorses, and recommends use of standardized healthcare performance measures. NQF advises the federal government and private sector payers on the optimal measures for use in specific payment and accountability programs.


tree-576847_640The Joint Commission, the nation’s oldest and largest standards-setting and accrediting body in health care,  accredits and certifies more than 21,000 health care organizations and programs in the United States. Some certifications are for disease-specific programs whereas others are for a service such as palliative care in a healthcare organization.



tree-576847_640The Agency for Healthcare Research and Quality (AHRQ) is a federal agency that funds research and creates materials including quality measures to be used by providers, payers, and policymakers. The agency created the National Quality Strategy on behalf of the US Department of Health and Human Services in 2011, which first defined the “Triple Aim.” It also created the Consumer Assessment of Healthcare Providers and Systems surveys (CAHPS) which is used on on CMS’s Hospital Compare Web tool and in CMS’s star ratings system.


tree-576847_640The Center for Medicare and Medicaid Innovation (CMMI) is the branch of CMS that tests new payment and service delivery models. It plays a critical role in the Quality Payment Program, part of the recent MACRA legislation that replaces Medicare’s Sustainable Growth Rate formula to determine provider reimbursement. CMMI is part of CMS and supports the development and testing of innovative healthcare delivery models through an array of demonstration models, including models based on sharing risk across a population such as accountable care organizations (ACOs) and others based on therapeutic areas such as ESRD.  

tree-576847_640The Patient Centered Outcome Research Institute (PCORI) is a nonprofit charged with investigating the relative effectiveness of various medical treatments. It funds comparative effectiveness research (CER) to show the relative value of different treatment options as well as methodology studies to determine best practices for CER. Note: As a government-sponsored entity that was created as part of the Affordable Care Act, PCORI is subject to being dismantled with a repeal of the Affordable Care Act.


tree-576847_640The Institute for Clinical and Economic Review (ICER) is a nonprofit that publishes CER in an effort to ascertain the true value of competing treatment regimens, devices, and drugs. It evaluates evidence on the value of medical tests, treatments and delivery system innovations.  Recently, ICER has been evaluating several drug therapies and recommending prices based on their analysis to payers.


tree-576847_640The Pharmacy Quality Alliance (PQA) develops medication-use measures in areas such as medication safety, medication adherence, and appropriateness.  Health plans, PBMs, pharmacies and state-based agencies all use PQA’s metrics.


key-311986_640Key Quality Rating Systems


tree-576847_640Healthcare Effectiveness Data and Information Set (HEDIS).

Developed by the National Committee for Quality Assurance (NCQA), HEDIS is utilized by commercial health plans voluntarily and by government programs including Medicare and Medicaid. Consisting of over 80 measures across 7 domains of care, HEDIS is the bedrock of quality and is used by more than 90% of the country’s health plans. Some measures are utilized by all three channels whereas others are channel-specific based on the needs of that population.


This table is a sample of 2017 HEDIS measures published by NCQA:

HEDIS Measure Domain of Care Commercial? Medicaid? Medicare?
Annual Monitoring for Patients on Persistent Medications Effectiveness of Care Yes Yes Yes
Adherence to Antipsychotic Medications for Individuals with Schizophrenia Effectiveness of Care No Yes No
Aspirin Use and Discussion Effectiveness of Care Yes Yes No
Adults’ Access to Preventive/Ambulatory Health Services Access Yes Yes Yes
CAHPS Health Plan Survey Experience Yes Yes No
Frequency of Selected Procedures Utilization Yes Yes Yes
Emergency Department Utilization Utilization Yes No Yes
Relative Resource Use for People with Diabetes Relative Resource use Yes Yes Yes
Enrollment by State Health Plan Descriptive Information Yes Yes Yes
Depression Remission or Response for Adolescents and Adults EHR Yes Yes Yes


tree-576847_640Medicare 5-Star Ratings. Medicare 5-Star Ratings were developed to incentivize high quality care from health plans and to help Medicare Advantage customers choose among competing plans.  The Centers for Medicare and Medicaid Services (CMS) rates Medicare Advantage MA-PD plans (Medicare Advantage plans with prescription drug coverage) on up to 44 measures, whereas MA-only and stand-alone PDP plans are rated on a portion of these measures. The 2017 Star Ratings include an adjustment based on socioeconomic status of enrollees (to understand why this is important, see our Risk post).  CMS also pays bonuses and rebates to plans based on their performance on the 5-Star Rating metrics, encouraging achievement and reporting of high-quality care.


tree-576847_640The Medicare Hospital Readmission Reduction Program (HRRP) financially penalizes hospitals with relatively higher rates of Medicare readmissions. Other programs aimed at reducing readmission rates include CMS’s Pioneer Accountable Care Organizations (ACOs), bundled-payment initiatives, and the Independence at Home demonstration, all of which incentivize providers to lower hospital admission and readmission rates. The program impacts only a small fraction of hospitals serving Medicare patients nationally. However according to a recent Kaiser Foundation study, readmissions have dropped nationally since 2012, which correlates with the introduction of the HRRP.


key-311986_640Key Measures within Systems


tree-576847_640Advancing Care Information (ACI). This part of MACRA addresses what was known as “EHR Meaningful Use” before. Hospitals that participated in Medicare and Medicaid Electronic Health Record Incentive Programs were required to show proof of EMR Meaningful USe starting in 2014. With MACRA’s passage, that program is essentially replaced since all Medicare providers are now in MIPS or APMs automatically, where they are subject to ACI. This is a welcome change to providers who were burdened by limitations of the EMR Meaningful Use requirements.


tree-576847_640Electronic Prescribing (eRx) is the computer-based electronic generation, transmission and filling of a medical prescription, taking the place of paper and faxed prescriptions. E-prescribing allows a physician, nurse practitioner, or physician assistant to electronically transmit a new prescription or renewal authorization to a community or mail-order pharmacy.


tree-576847_640Hospital Readmissions Rates. Readmissions are defined as an admission to a hospital within 30 days of a discharge from the same or another hospital. Adopted readmission measures include:

  • COPD
  • Heart Attack
  • Heart Failure
  • Pneumonia
  • Hip or Knee Replacement

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