Pediatric carve outs. The use of disease-specific conditions as risk adjusters in capitated payment systems

Using health-related quality of life to predict and manage pediatric healthcare

Increasing healthcare costs and the prevalence of managed care make population health management an imperative. Health-related quality of life (HRQOL) is a multidimensional construct that includes both physical and psychosocial (i.e., social, emotional and role) dimensions. Early studies suggest that HRQOL can predict costs of care for pediatric populations. A key issue is how to manage the care of those identified as high need. Here again, HRQOL measurement can be useful. HRQOL measurement in the clinical setting can streamline and structure the clinical interview, potentially leading to enhanced assessment. It can also make it easier for busy pediatricians to explore and address issues of psychosocial functioning. A particularly promising area for HRQOL is in identifying, proactively, suitable candidates for case management in large enrolled populations. Further research should extend the initial studies on HRQOL predicting utilization and cost, more thoroughly specify the proportion of identified costs that are manageable and care management's effect on care for different groups of children, document the causal links between physiologic variables and HRQOL on one hand and patient functioning on the other, and understand the conditions necessary for HRQOL assessment to affect clinical practice.

Variation in specialty care hospitalization for children with chronic conditions in California

OBJECTIVE

Despite the documented utility of regionalized systems of pediatric specialty care, little is known about the actual use of such systems in total populations of chronically ill children. The objective of this study was to evaluate variations and trends in regional patterns of specialty care hospitalization for children with chronic illness in California.

METHODS

Using California's Office of Statewide Health Planning and Development unmasked discharge data set between 1999 and 2007, we performed a retrospective, total-population analysis of variations in specialty care hospitalization for children with chronic illness in California. The main outcome measure was the use of pediatric specialty care centers for hospitalization of children with a chronic condition in California.

RESULTS

Analysis of 2 170 102 pediatric discharges revealed that 41% had a chronic condition, and 44% of these were discharged from specialty care centers. Specialty care hospitalization varied by county and type of condition. Multivariate analyses associated increased specialty care center use with public insurance and high pediatric specialty care bed supply. Decreased use of regionalized care was seen for adolescent patients, black, non-Hispanic children, and children who resided in zip codes of low income or were located farther from a regional center of care.

CONCLUSIONS

Significant variation exists in specialty care hospitalization among chronically ill children in California. These findings suggest a need for greater scrutiny of clinical practices and child health policies that shape patterns of hospitalization of children with serious chronic disease.

The Impact of Managed Care Enrollment on Emergency Department Use Among Children With Special Health Care Needs

BACKGROUND

Many states recently have experimented with managed care as a way both to control costs and to enhance continuity of care in their publicly financed programs. A few states have applied managed care models to the care of chronically ill children. One marker for the effects of managed care is changes in use of the emergency department (ED).

OBJECTIVE

We sought to determine whether a managed care program can reduce ED use for children with chronic health problems.

SUBJECTS

We studied chronically ill children who were dually enrolled in Michigan's Title V program for children with special health care needs and Medicaid and who were enrolled in a managed care option at some time during the study period. The managed care model emphasized care coordination and did not include strong financial incentives for utilization and cost control. Sample consisted of 8580 person-months.

METHOD

We used a fixed-effect negative binomial Poisson regression model to compare ED use before and after joining a managed care plan to test whether managed care use was associated with reduced likelihood of ED use.

RESULTS

Managed care enrollment was associated with a 23% reduction in the incidence of ED use among children dually enrolled in Medicaid and Title V.

CONCLUSIONS

A managed care model is associated with statistically significant and substantive reductions in observed use of ED care within an important population of children facing chronic illness.

Incentives in a Medicaid carve-out: impact on children with special health care needs

OBJECTIVE

To evaluate whether a specialty care payment "carve-out" from Medicaid managed care affects caseloads and expenditures for children with chronic conditions.

DATA SOURCE

Paid Medicaid claims in California with service dates between 1994 and 1997 that were authorized by the Title V Children with Special Health Needs program for children under age 21.

STUDY DESIGN

A natural experiment design evaluated the impact of California's Medicaid managed care expansion during the 1990s, which preserved fee-for-service payment for certain complex medical diagnoses. Outcomes in time series regression include Title V program participation and expenditures. Multiple comparison groups include children in managed care counties who were not mandated to enroll, and children in nonmanaged care counties.

DATA COLLECTION/EXTRACTION METHODS

Data on the study population were obtained from the state health department claims files and from administrative files on enrollment and managed care participation.

PRINCIPAL FINDINGS

The carve-out policy increased the number of children receiving Title V-authorized services. Recipients and expenditures for some ambulatory services increased, although overall expenditures (driven by inpatient services) did not increase significantly. Cost intensity per Title V recipient generally declined.

CONCLUSIONS

The carve-out policy increased identification of children with special health care needs. The policy may have improved children's access to prevailing standards of care by motivating health plans and providers to identify and refer children to an important national program.

Profile of medical charges for children by health status group and severity level in a Washington State Health Plan

OBJECTIVE

To identify children and evaluate patterns of charges for pediatric medical care, by overall health status, severity of illness, and categories of medical service. Data Sources Enrollment, claims, and charges data from a Washington State health plan. The study population includes all children ages 0 to 18 years during calendar year 1999.

STUDY DESIGN

Children were classified into clinically defined health status groups and severity levels using Clinical Risk Groups (CRGs). Health plan charges were analyzed according to core health status group, severity level, and category of service.

DATA COLLECTION

The three secondary data sources were obtained electronically from the health plan and cleaned for unique members and data quality before analysis.

PRINCIPAL FINDINGS

Children classified as healthy (85.2 percent) had mean and median annual charges of dollar 485 and dollar 191. Children with one or more chronic conditions (9.5 percent) had mean and median charges increasing by status and severity group from dollar 2,303 to dollar 76,143 and from dollar 1,151 to dollar 19,456, and accounted for 45.2 percent of all charges. Distribution of charges varied across health status groups. Healthy children had 70.6 percent of their charges in outpatient and physician services. Children classified in the complex, catastrophic, and malignancy groups had 67 percent of their charges in inpatient encounters. Children with chronic conditions accounted for 31.8 percent of all physician, 41.8 percent of outpatient, 47.7 percent of pharmacy, 60.7 percent of inpatient, and 75.8 percent of all other charges.

CONCLUSIONS

Children with chronic conditions account for a disproportionately high percentage of children's health expenditures. They account for different percentages of expenses for different medical services. These percentages vary according to health status and severity. This analysis can be used to identify and track groups of children for various purposes.

Using risk-adjustment models to identify high-cost risks

BACKGROUND

We examine the ability of various publicly available risk models to identify high-cost individuals and enrollee groups using multi-HMO administrative data.

METHODS

Five risk-adjustment models (the Global Risk-Adjustment Model [GRAM], Diagnostic Cost Groups [DCGs], Adjusted Clinical Groups [ACGs], RxRisk, and Prior-expense) were estimated on a multi-HMO administrative data set of 1.5 million individual-level observations for 1995-1996. Models produced distributions of individual-level annual expense forecasts for comparison to actual values. Prespecified "high-cost" thresholds were set within each distribution. The area under the receiver operating characteristic curve (AUC) for "high-cost" prevalences of 1% and 0.5% was calculated, as was the proportion of "high-cost" dollars correctly identified. Results are based on a separate 106,000-observation validation dataset.

MAIN RESULTS

For "high-cost" prevalence targets of 1% and 0.5%, ACGs, DCGs, GRAM, and Prior-expense are very comparable in overall discrimination (AUCs, 0.83-0.86). Given a 0.5% prevalence target and a 0.5% prediction threshold, DCGs, GRAM, and Prior-expense captured $963,000 (approximately 3%) more "high-cost" sample dollars than other models. DCGs captured the most "high-cost" dollars among enrollees with asthma, diabetes, and depression; predictive performance among demographic groups (Medicaid members, members over 64, and children under 13) varied across models.

CONCLUSIONS

Risk models can efficiently identify enrollees who are likely to generate future high costs and who could benefit from case management. The dollar value of improved prediction performance of the most accurate risk models should be meaningful to decision-makers and encourage their broader use for identifying high costs.

Deaths attributed to pediatric complex chronic conditions: national trends and implications for supportive care services

BACKGROUND

Children with complex chronic conditions (CCCs) might benefit from pediatric supportive care services, such as home nursing, palliative care, or hospice, especially those children whose conditions are severe enough to cause death. We do not know, however, the extent of this population or how it is changing over time.

OBJECTIVES

To identify trends over the past 2 decades in the pattern of deaths attributable to pediatric CCCs, examining counts and rates of CCC-attributed deaths by cause and age (infancy: <1 year old, childhood: 1-9 years old, adolescence or young adulthood: 10-24 years old) at the time of death, and to determine the average number of children living within the last 6 months of their lives.

DESIGN/METHODS

We conducted a retrospective cohort study using national death certificate data and census estimates from the National Center for Health Statistics. Participants included all people 0 to 24 years old in the United States from 1979 to 1997. CCCs comprised a broad array of International Classification of Diseases, Ninth Revision codes for cardiac, malignancy, neuromuscular, respiratory, renal, gastrointestinal, immunodeficiency, metabolic, genetic, and other congenital anomalies. Trends of counts and rates were tested using negative binomial regression.

RESULTS

Of the 1.75 million deaths that occurred in 0- to 24-year-olds from 1979 to 1997, 5% were attributed to cancer CCCs, 16% to noncancer CCCs, 43% to injuries, and 37% to all other causes of death. Overall, both counts and rates of CCC-attributed deaths have trended downward, with declines more pronounced and statistically significant for noncancer CCCs among infants and children, and for cancer CCCs among children, adolescents, and young adults. In 1997, deaths attributed to all CCCs accounted for 7242 infant deaths, 2835 childhood deaths, and 5109 adolescent deaths. Again, in 1997, the average numbers of children alive who would die because of a CCC within the ensuing 6-month period were 1097 infants, 1414 children, and 2548 adolescents or young adults.

CONCLUSIONS

Population-based planning of pediatric supportive care services should use measures that best inform our need to provide care for time-limited events (perideath or bereavement care) versus care for ongoing needs (home nursing or hospice). Pediatric supportive care services will need to serve patients with a broad range of CCCs from infancy into adulthood.

The academic children's hospital primary care clinic: responding to the challenges of a changing health care environment

Academic medical centers have encountered increasing fiscal challenges as the paradigm in health care has shifted from traditional fee-for-service reimbursement to systems of managed care. Most academic centers have maintained primary care clinics, which have served as "educational laboratories" for students and trainees. Largely providing care to underserved patients, academic primary care clinics have been heavily dependent on Medicaid reimbursement for support. Given the realities of a rapidly changing health care environment, academic primary care clinics have been challenged to respond with innovation and creativity in order to remain viable. The pediatric primary care clinic at Rainbow Babies & Children's Hospital of University Hospitals of Cleveland initiated a reorganization program with the goal of ensuring that patients receive quality, cost efficient care and that students and pediatric residents receive first-rate ambulatory education in a fiscally responsible setting. Fundamental was the setting of priorities for patient care and service while promoting an environment conducive to medical education. Educational programs were segregated into a well-defined educational "module," and various initiatives were advanced emphasizing patient access, consistency of care, efficient use of space and personnel resources, limitation of inappropriate use of costly after-hours resources, and identification and coordination of care for patients with chronic illness and/or at high risk for medical complications. Three years after the instituting of fundamental organizational change, objective measures of cost efficiency and selected quality measures compare quite favorably with a broad range of primary care providers throughout the region. If academic medical centers are to remain leaders in ambulatory pediatric education, energetic, proactive, and thoughtful responses to the rapidly changing global health care environment will be necessary.

Usage of emergency medical services by children with special health care needs

OBJECTIVE

To describe the usage of emergency medical services (EMS) by children with special health care needs (CSHCN).

METHODS

All EMS runs and related hospital records for children aged 0-17 years in Utah in 1991-92 were linked. The CSHCN status was determined from ICD-9 diagnoses using three available definitions. The amounts of EMS usage were compared between CSHCN and other children. A pediatric intensive care practitioner determined CSHCN status by chart review for 915 children transported by EMS to a pediatric tertiary care hospital, and his classification was compared with the CSHCN status assigned by the three ICD-9-based definitions.

RESULTS

The three definitions assigned CSHCN status for 2% to 24% of children using EMS. When compared with other children, CSHCN were more likely to be admitted to the hospital, more likely to use EMS for transfer between health care facilities, and more likely to receive prehospital procedures such as intravenous therapy. In the group of children whose charts were reviewed individually, one ICD-9-based definition most closely agreed to determination of CSHCN status by a pediatric intensive care practitioner.

CONCLUSIONS

Children with special health care needs who use EMS are more likely to receive advanced life support service, to receive prehospital procedures, and to be transferred from one health care facility to another. There is need for a specific and measurable definition of CSHCN that can be applied to existing health data.

Capitation for cardiologists: accepting risk for coronary artery disease under managed care

Patients with chronic disease may be excluded from capitated managed care plans due to higher than average expected costs. In an attempt to remedy this inequity, one type of risk adjustment technique proposes to set separate capitation rates for certain chronic illnesses, including coronary artery disease (CAD). Cardiologists, who increasingly are requested to accept capitation, will benefit from understanding the impact of using clinical factors as opposed to using demographic factors to set capitation rates. Using a 5% national random sample of the 1992 Medicare population, we determined mean annual expenditures and variation in expenditures of individuals with CAD. We compared the use of 2 demographic factors currently used for capitation rate adjustment (age and gender) with 2 factors not currently used--3-digit International Classification of Disease (ICD-9) code (a measure for severity) and Charlson index (a measure for comorbidity). Mean annual expenditures for individuals with CAD were more than double mean annual expenditures for the general Medicare population ($6,944 vs $3,247). Among individuals with CAD, mean expenditures of subgroups defined by both age and gender ranged from $6,205 to $7,724. In comparison, stratifying by measures of severity and comorbidity identified subgroups with lower and higher mean expenditures, producing a range of $1,702 to $19,959. Substantial variation of expenditures for individuals within subgroups defined by severity and comorbidity remained, with few patients having substantially higher expenditures than the rest. When capitation rates are set with the use of demographic factors alone, patients may be subjected to risk selection and physicians to financial loss. Using clinical measures may decrease the incentive for patient risk selection, but substantial financial risk to physicians would remain, because of a relatively few patients with high expenditures (or costs).

The surgeon and casemix

Casemix funding has markedly increased surgeons' awareness of the economies of the activities they undertake. Surgery has become a major focus at all large public hospitals, because of its high earning potential, and this pressure to maximise funding could influence surgical practice. Casemix funding's emphasis on length of hospital stay has encouraged forward planning for earlier discharge after surgical procedures. Patients are now assessed in pre-admission clinics, educated about their condition and their hospital stay, and a plan formulated for their discharge and rehabilitation. Funding for major surgical procedures of long duration in patients with complex conditions should reflect the higher level of resource utilisation. Tertiary referral centres, because of their commitment to training and research and their more severely ill patient population, are less cost-effective and require funding to ensure their viability. The improved information that casemix generates should be used to evaluate outcomes and improve patient care; efficiency must not take precedence over quality of care and compassion.

The true cost of treating children

Paediatric patients (compared with adults) require additional time, effort and skill from hospital staff caring for them. Many suggestions for making successive versions of AN-DRGs more child friendly have not been implemented. Rather than relying on age, the AN-DRG classification should allow a better definition of complexity within DRGs. The two groups of children who place a disproportionate burden on paediatric teaching centres are children under 3 years and those with congenital abnormalities and chronic illness. Cost weights are not specific for paediatric patients. The extra costs of caring for children are reflected in nursing costs, highlighting the importance of including nurse dependency data in any costing study.

Pediatric death certification

OBJECTIVE

To determine location, manner, and physician certifier of pediatric deaths.

DESIGN

A descriptive study of death certificate information for all child deaths (aged birth through 17 years) for the years 1995 and 1996.

SETTING

Urban county of more than 780,000 population.

MAIN OUTCOME MEASURES

Field of specialty of physician certifiers, location of death, and category of deaths certified by the medical examiner.

RESULTS

Of 361 child deaths, 42.6% were certified by the medical examiner, 24.1% by neonatologists, 10.0% by obstetricians, 8.0% by pediatric critical care specialists, and 5.3% by general pediatricians. The remaining deaths were certified by pediatric subspecialists, surgeons, family practitioners, emergency medicine specialists, hospital pathologists, and law enforcement officials. The medical examiner certified deaths due to trauma (64.5%), sudden infant death syndrome (13.5%), unexplained or suspicious causes (9.7%), medical or surgical complications (3.9%), or because no other physician certifier was available (5.8%). Most children were pronounced dead at hospitals, but 10.0% died at home, 4.4% on roads, and 2.5% on public or private lands.

CONCLUSIONS

General pediatricians are unlikely to be directly involved in the care of most children who die and are therefore unlikely to sign the death certificate. Education about death and dying issues should be available for all pediatricians but should be directed at those specialists most likely to provide care during critical events. Support services for families need to be community based and accessible to survivors.

Alzheimer's disease under managed care: implications from Medicare utilization and expenditure patterns

BACKGROUND

Little information is available about the costs, utilization patterns, and the delivery system used by Medicare beneficiaries with chronic illnesses. This information will become increasingly important as more Medicare beneficiaries with chronic illness enroll in managed care plans and delivery systems must be developed to meet their needs.

OBJECTIVES

To analyze health care expenditures and utilization patterns for Medicare beneficiaries with dementia of the Alzheimer type (DAT) and compare them with those of all Medicare beneficiaries.

DESIGN

A cross-sectional study.

SETTING

Practices providing services to Medicare beneficiaries in the U.S.

SUBJECTS

Aged Medicare beneficiaries with DAT in fiscal year (FY) 1992.

MEASUREMENTS

Medical expenditures and utilization patterns.

RESULTS

In FY 1992, per capita Medicare expenditures for 9323 patients with DAT were $6208, or 1.9 times the per capita expenditure for all 1,221,615 beneficiaries in our sample. Inpatient care accounted for 62.7% of expenditures. Internal medicine was the specialty identified with the largest proportion of expenditures, but no single specialty accounted for the majority of care. Payments increased with comorbid conditions such as heart failure, chronic pulmonary diseases, and cerebrovascular disease.

CONCLUSION

Current Medicare capitation payments to managed care plans may not meet the higher expected annual costs of care for beneficiaries with DAT. In turn, physicians (or physician groups) who accept capitation for Medicare beneficiaries with DAT should also consider how capitation rates are established by managed care plans and should learn ways to reduce financial risk.