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C M S  R E F L E C T I O N S
 
26 July 2005  
  

Medicare, Medicaid, 
And Health Care Quality

A focus on quality assessment has become ensconced
in the nation’s health care system, but it was not an easy task.


by William L. Roper


Medicare and Medicaid were born out of a desire to expand access to health care to millions of aged and poor Americans. Although the forty-year history of the programs has been dominated by concerns about the cost of that care, I believe that we are now rightly focusing much attention on two critical considerations: the quality of the care paid for by Medicare and Medicaid, and its safety.

Quality of care in Medicare reached the public agenda following the congressional enactment in 1983 of the Medicare hospital prospective payment system (PPS), based on diagnosis-related groups (DRGs). The PPS changed hospital payment to fixed amounts tied to diagnosis and gave strong incentives to discharge patients earlier than had been the practice. Congress began holding hearings about whether incentives to discharge patients earlier meant that patients went home from the hospital “quicker and sicker.”

In the middle of this controversy, in the spring of 1986, I became administrator of the Health Care Financing Administration (HCFA), now the Centers for Medicare and Medicaid Services (CMS), and became deeply involved in some activities that are linked to these issues. I sought good advice, and the advice I got helped lead me to make improving the quality of care in Medicare and Medicaid my top priority during my tenure there. I meant to make systematic changes in quality instead of simply trying to respond to the chorus of assertions that we were having quality problems as each new change arose.

We soon found an opportunity to motivate change. The New York Times had asked HCFA for data we had accumulated for the peer review organizations (PROs) on Medicare patients’ death rates. Instead of releasing the data and running, we decided to initiate the annual publication of the Medicare hospital mortality rates. HCFA staff did the statistical analysis and publication, with significant and ongoing consultation by leading health services researchers. We were careful to point out that these documents should not be used alone to make judgments about quality of care in specific hospitals, but ought to be used by consumers, providers, and the public to raise questions for further investigation. Despite that disclaimer, the hospital industry was very vocal in its opposition to the release of these data.

We made it clear that although we welcomed everyone’s help in improving the documents, we were not going to debate whether or not to publish this information, since we believed that the public had a right to it, and we believed that the information could become a stimulus for quality improvement. Shortly after initiating the publications, we began work toward creating an organized capability to use Medicare information to improve health care quality, which we explained in an article in the New England Journal of Medicine in 1988, titled, “Effectiveness in Health Care.”

In 1989, when Congress changed the methodology for paying physicians under Medicare, it also created what has become the Agency for Healthcare Research and Quality (AHRQ), in part to give a home within the U.S. Public Health Service for work on health care quality and effectiveness. Shortly after that accomplishment, I left HCFA.

By the time publication of the Medicare hospital mortality information was discontinued in the mid-1990s, the cause of measuring and reporting results on quality in health care had found a secure place on the larger agenda of improving the nation’s health care quality. The National Quality Forum (NQF) came into existence in 1999 in response to the call by President Clinton’s Commission on Quality and Consumer Protection in Health Care for an organization to facilitate standards for measuring and reporting on quality. The NQF, AHRQ, and others are now carrying out much of the agenda we wrote about in 1988. The Institute of Medicine (IOM) reports on health care quality and patient safety published since 1999, and, more recently, AHRQ’s National Healthcare Quality Reports have also been key events in the quest for a new health system with much-improved quality.

Today the CMS has a broad agenda for improving the quality of care in Medicare, and efforts are beginning to focus on Medicaid quality as well. Maintaining this focus on quality will be even more important in the coming years, as Medicare and other large purchasers move toward adoption of performance-based payment systems. Measuring quality, performance, and value is an appropriate and prominent part of the public debate on these new payment approaches. We have achieved a broad-based, bipartisan partnership to improve quality. In the coming years, we must take full advantage of the partnership we have crafted to continue to advance quality.

Bill Roper (roper{at}med.unc.edu) is chief executive officer of the University of North Carolina Health Care System; dean of the School of Medicine, University of North Carolina at Chapel Hill, and dean of its School of Public Health. He was administrator from May 1986 to February 1989. After leaving HCFA, he became director of the U.S. Centers for Disease Control and Prevention (CDC), and has served in a variety of key White House positions under Presidents Ronald Reagan and George H.W. Bush.

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DOI: 10.1377/hlthaff.w5.331
©2005 Project HOPE–The People-to-People Health Foundation, Inc.