Back to previous page

Leapfrog Group Launches National Hospital Rewards Program

Health Care Purchasers Continue To Innovate In Quality Measurement, Reporting And Pay For Performance

(WASHINGTON DC) – GE, Hannaford Brothers, Verizon Communications and other private-sector health care purchasers will be in Washington DC tomorrow and Friday at a workshop on two innovative pay for performance programs, spanning inpatient and outpatient care, designed to trigger significant health care improvement for their employees – the Leapfrog Hospital Rewards Program and Bridges to Excellence (BTE), which is focused on physician quality in doctor offices.  Organized by The Leapfrog Group and the National Business Coalition on Health, more than 180 employers, coalitions, health plans, benefits consultants and providers from around the U.S. eager to implement these innovative programs in their markets will attend the workshop.

Inspired by the Premier/CMS Hospital Quality Incentive Demonstration Project, and building on the measures in the Hospital Quality Alliance initiative, the Leapfrog Hospital Rewards Program will measure the quality of care and the efficiency with which hospitals use resources in five clinical areas that represent a significant portion of hospital admissions and expenditures among the commercially-insured population.  Hospitals will be scored and rewarded separately for each of the five areas and can participate in any of the areas in which they provide care.  If they demonstrate sustained excellence or improvement, hospitals will be eligible for financial rewards and increased market share.  Hospital scores can become the basis for financial incentives for consumers, such as waived co-pays or deductibles for choosing care at high performing or improving hospitals.  Additionally, these scores can be incorporated into health plans’ existing performance-based incentive and reward programs.  The Program is engineered by Leapfrog, with the input of a vast array of providers and health plans, but designed to be implemented by health plans and employers in specific markets.

Suzanne Delbanco, chief executive officer of The Leapfrog Group, says, “Leapfrog’s goal is to promote high-value health care through incentives and rewards.  This first ever national private-sector program responds to the urgent needs of our members for solutions to address escalating health costs and uneven quality.  Our ‘off-the-shelf’ Hospital Rewards Program builds in incentives for continued improvements in hospital quality and efficiency and enables health plans, purchasers and coalitions to move swiftly to provide actuarially-sound rewards for hospitals.”

“We are pleased that a number of organizations have already committed to work with us to establish the Leapfrog Hospital Rewards Program in the market,” Delbanco continued.  “These include CIGNA HealthCare, The Memphis Business Group on Health, Premier, Inc., GE, Hannaford Brothers, Verizon Communications and the Human Resources Policy Association who is incorporating this program in two initiatives – one regionally and one to address the issue of the uninsured.”

Ellen Stovall, president and chief executive officer of the National Coalition for Cancer Survivorship, and a member of Leapfrog’s Board, commented, “Anyone who has experienced the void we face as consumers in trying to make informed health care decisions will applaud these programs which are urgently needed for promoting transparency in the marketplace and ultimately much better care for patients.”

Says, Bob Galvin, director Global Health Care for GE, “The introduction of a national, ready to implement, pay for performance program for hospitals will make it easy for the private sector to identify and reward those hospitals that are taking good care of employees and at the same time help us to get better value for our health care dollar.  We are excited to be working with Verizon and Hannaford Brothers to implement the program in the Capital Region of N.Y.”

May 2005

The Rewards Program uses quality measures that are endorsed by the National Quality Forum and are already being collected through the Joint Commission on the Accreditation of Healthcare Organizations (JCAHO) ORYX initiative and the Leapfrog Hospital Quality and Safety Survey. To measure efficiency of resource use, Leapfrog will look at severity-adjusted average length of stay and readmission rates for each of the five clinical areas.

Dennis O’Leary, president of the Joint Commission on the Accreditation of Healthcare Organizations (JCAHO), added, “The Joint Commission is pleased to support Leapfrog’s continued efforts to promote improvements in health care quality.  We are especially gratified that Joint Commission performance data are being used by Leapfrog and others to inform consumers about health care quality and patient safety in hospitals and to reward providers for their improvement efforts.”

Says Rick Norling, president and chief executive officer of Premier, Inc., “We are delighted to endorse the Leapfrog Hospital Rewards Program to our hospitals and will be recommending that they all participate.  We contributed our experience and analyses from our Perspective comparative database to Leapfrog throughout the development of this program.  The positive results we are seeing in our demonstration project with CMS bode well for this private-sector initiative.”

Bridges to Excellence, which focuses on ambulatory care improvement, is already in place in four markets.  Now employers, coalitions and health plans, including United Healthcare, CIGNA HealthCare, and CareFirst, are preparing to implement its programs in an additional 20 markets.  BTE is currently based on three physician recognition programs designed and administered by the National Committee on Quality Assurance which cover diabetes and heart care, as well as patient education and use of health care information technology.  CMS has looked to BTE in designing cutting-edge Medicare demonstration projects, including the Medicare Care Management Performance.  Over the next few years, BTE will be working rapidly to expand its pay for performance programs to include clinical areas that constitute close to 70% of employers’ outpatient expenditures.

Verizon Communication’s Jeff Hanson, who chairs BTE, said “Verizon and other employers involved in BTE are setting the pace for helping consumers make informed smarter health care choices and tying provider payments to quality care.  We look forward to continuing to work with physicians to chart our future course.”

Added Jeffrey Kang, M.D, senior vice president and chief medical officer for CIGNA HealthCare, “CIGNA is excited to participate with The Leapfrog Group and Bridges to Excellence to expand access to information for consumers and employers about physician and hospital quality in Phoenix.  These two programs produce data that health plans and other payers can use to reward hospitals and physicians for their quality improvements.  They are of enormous value to us and other plans.“

Bridges to Excellence

The Bridges to Excellence coalition is a not-for-profit organization created to encourage significant leaps in the quality of care by recognizing and rewarding health care providers who demonstrate that they deliver safe, timely, effective, efficient and patient-centered care. In addition to NBCH, Bridges to Excellence participants include large employers, coalitions, health plans, the National Committee for Quality Assurance, Medstat, Ingenix and WebMD Health, among others. The organizations are united in their shared goal of improving health care quality through measurement, reporting, rewards and education. For more information: www.bridgestoexcellence.org

The Leapfrog Hospital Rewards Program

The five clinical areas on which the Leapfrog Hospital Rewards Program focuses are: coronary artery bypass graft, percutaneous coronary intervention, acute myocardial infarction, community-acquired pneumonia and deliveries/newborn care.  Actuaries at Towers Perrin analyzed hospital quality and payment data to identify these areas, which represent approximately 33% of admissions and 20% of commercial payers’ inpatient expenditures and present significant opportunity for quality and efficiency improvements. Towers Perrin also performed the actuarial analysis to support the reward structure. All data collected for the Leapfrog Hospital Rewards Program will be submitted to Medstat, Leapfrog’s general contractor for the program, to be aggregated, scored and ranked.  The Program is now accepting data from hospitals and the first results will be available in October this year.  The first implementers are likely to begin paying rewards in 2006. For more information:  https://leapfrog.medstat.com/hrp/index.asp. 

The Leapfrog Group

The Leapfrog Group was founded in November 2000 by the Business Roundtable and has support from The Robert Wood Johnson Foundation. Over 170 Fortune 500 corporations and other large private and public sector health benefits purchasers have joined The Leapfrog Group, representing more than 36 million enrollees.  The Leapfrog Group is an initiative driven by organizations that buy health care who are working to initiate breakthrough improvements in the safety, quality and affordability of healthcare for Americans. It is a voluntary program aimed at mobilizing employer purchasing power to alert America’s health industry that big leaps in health care safety, quality and customer value will be recognized and rewarded.  For more information: www.leapfroggroup.org. 

Medstat

Medstat (www.medstat.com) provides data collection, analysis, and support services to The Leapfrog Group for the Hospital Quality and Safety Survey. Medstat is a healthcare information company that provides market intelligence and benchmark databases, decision support solutions, and research services for managing the cost and quality of healthcare. The company applies these capabilities to improve policy and management decision making for many of the nation’s leading employers, government agencies, health plans, hospitals and provider networks, and pharmaceutical companies. Medstat is a business within the Thomson Corporation (www.thomson.com).

National Business Coalition on Health (NBCH)

The National Business Coalition on Health (NBCH) is a national, non-profit, membership organization of employer based health coalitions.  NBCH and its members are dedicated to value-based purchasing of health care through the collective action of public and private purchasers.  NBCH seeks to accelerate the nation’s progress towards safe, efficient high quality health care and the improved health status of the American population. For more information on NBCH:www.nbch.org.

# # #