Tuesday, April 14, 2009

6. Measurement

If you can’t measure it, you can’t effect change

The choice of the underlying measurements to determine the winner of the Healthcare X PRIZE will have long-lasting implications. The choice of measures will shape the solutions teams will use to compete; the approach to weighting of the index will determine the potential for returns on any health investment. Therefore, given the complexity of the choices, we decided to begin by laying out a philosophic approach to the measurements to be used.

The winner of the Healthcare X PRIZE will need to focus on creating value through improvements in community-level outcomes and costs. Therefore, metrics will need to be at the community/ population level and objective and easy to track using validated tools, where possible. The number of metrics used should be at a manageable level, so we are utilizing broad outcome-based measures, rather than any process metrics or intermediate markers. Given the goal of health optimization, we’re choosing metrics that are either markers of health status improvement or a clinical event we would like to remove from the human experience. We will weight the measures to place functional improvement at equal stature with sick care. All measures will be actionable with existing case examples that indicate significant changes can be achieved. On the cost side, we look to include as many direct costs as possible across multiple types of payment methods and reflect the actual bill at time of service. Test communities will be actuarially equivalent, potentially through the use of oversampling for certain characteristics, allowing us to use real data from the trial groups without the need to further adjust or project it.

Measuring “health value” requires the creation of new measures reflecting improvements in community health and total costs. The initial definition of the “community health index” focuses on tracking the reduction in clinical events, improvements in productivity, and improvements in functional health. Measures under consideration include:

  • Elimination of acute exacerbation: Hospitalization/ rehospitalization; ER visits; Communicable
  • Reductions in long-term impairment: Major morbidity, long term disability, long term care, Mortality
  • Reductions in short-term impairment: Unplanned absence (work, school), short term disability
  • Optimization of individual vitality: Functional fitness, self-reported health status

Initial definition of “total cost” is oriented around direct, actual costs incurred for health. This includes funds processed through the claims system, medical spend incurred via charge card, reimbursed out of pocket spend, and selected non-qualified health spend out of pocket. Direct costs also include communication and incentive program costs to activate, engage, and inform consumers. Sick and disability pay are also costs that can be added. We will not include projected or estimated costs such as presenteeism, as they cannot be objectively captured using current instruments. We will include team costs for operating in the test market (this does not include the creation of any scalable back-end) and does not count an outreach/ testing budget for the 6 month “dry run”/implementation period prior to the competition beginning.

The “individual vitality score” does not directly factor into the health value equation, as it is an individual metric designed by each team used to inform and engage individual consumers. However, we project that an “individual vitality score” will be critical in engaging consumers in health decisions across a wide variety of choices and settings.
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