Working Together to Improve Quality and Reduce Costs
Working together to improve the quality of care is one of the cornerstones of CHCC’s resolve to reduce costs and to better the health of our Members and the communities in which they live.
No one – providers, purchasers, and least of all patients – wants to see or feel the devastating impact of poor- quality care. We estimate that potentially preventable complications of clinical care impacted the lives of more
than 130,000 families in 2007 and cost Californians approximately $5.2 billion the equivalent of more than
172,000 jobs.*
Yet we all bear some responsibility for this problem, and we can all play a role in crafting a sustainable solution.
As purchasers, we promote poor-quality care through three distinct behaviors:**
- By choosing our healthcare providers based on price, without also examining plan
and provider performance;
- By using transaction-based (rather than outcomes-based) payment structures that
discourage quality improvement; and
- By failing to engage the consumer (employees and beneficiaries) on quality
issues.
CHCC has responded to these challenges with a strategy of constructive engagement between purchasers and healthcare providers that aligns our mutual interests in quality outcomes and affordable price.
CHCC’s cost-quality initiative is called Pay-for-Quality-Improvement (“PQI”) and has been getting results since 2007. Participating purchasers have enjoyed significant cost reductions, while the participating providers have seen increased patient volume and have received the highest clinical quality awards from such independent
quality review organizations as the American Heart Association.
To help achieve these cost and quality outcomes, CHCC’s PQI initiative focuses on achieving results in clinical patient outcomes. More traditional Pay-for-Performance (“P4P”) measures have also been incorporated into CHCC’s initiative, but the focus is on getting results in patient outcomes. When patient-outcome targets are achieved, the provider is recognized with financial incentives that support that clinical behavior, and the
purchaser is rewarded with lower costs and healthier patients.
PQI is not the “silver bullet” that will solve the quality-cost issues that challenge us all today, but it is a step forward in aligning payment policies to encourage and support providers for improving quality.*** And it is a
step that you can take today without waiting for Accountable Care Organizations, integrated delivery models, or the restructuring of your local community’s healthcare delivery system.
CHCC’s PQI initiative can be implemented in your community in a variety of ways that make sense for your organization and the healthcare providers that serve your communities’ needs. Contact us for additional information about how PQI can be of service to your community.
* CHCC 2009 Analysis of Iatric Hospital Care, OSHPD Hospital Discharge Data Set and Hospital
Annual Financial Disclosures (2007).
** British Medical Journal, vol. 324 at 7352 (June 22, 2002).
*** Institute of Medicine, Crossing the Quality Chasm:
A New Health System for the Twenty-first Century, Washington: National Academy Press (2001). | 
"America clearly needs a clear health care reform agenda... We get care wrong now for diabetics well over half the time. Kids with asthma get right care barely half the time. People who are depressed get right care less than a third of the time. Care in America definitely needs to be improved. .jpg)
"Where do premiums come from? Care costs. Medical costs and hospital costs basically create insurance premiums. So when American caregivers shift bad debt costs from covering unpaid care for uninsured people and increase their unit prices to insurers, the insurers automatically pass these cost increases along to everyone who buys insurance. That shifted amount now adds roughly $1200 to the premium costs of each family..." 