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David B. Nash • Maulik S. Joshi •

Elizabeth R. Ransom • Scott B. Ransom • Editors

HAP/AUPHA Editorial Board for Graduate Studies

Carla A. Stebbins, PhD, Chairman Rochester Institute of Technology

Kevin Broom, PhD University of Pittsburgh

Erik L. Carlton, DrPH University of Memphis

Daniel Estrada, PhD University of Florida

Edmond A. Hooker, MD, DrPH Xavier University

LTC Alan Jones, PhD, FACHE US Army

Christopher Louis, PhD Boston University

Peggy J. Maddox, PhD George Mason University

Donna Malvey, PhD University of Central Florida

Brian J. Nickerson, PhD

Icahn School of Medicine at Mount Sinai

Stephen J. O’Connor, PhD, FACHE University of Alabama at Birmingham

Maia Platt, PhD University of Detroit Mercy

Debra Scammon, PhD University of Utah

Tina Smith University of Toronto

James Zoller, PhD Medical University of South Carolina

Health Administration Press, Chicago, Illinois

Association of University Programs in Health Administration, Washington, DC

Your board, staff, or clients may also benefit from this book’s insight. For more information on quantity discounts, contact the Health Administration Press Marketing Manager at (312) 424-9450.

This publication is intended to provide accurate and authoritative information in regard to the subject matter covered. It is sold, or otherwise provided, with the understanding that the publisher is not engaged in rendering professional services. If professional advice or other expert assistance is required, the services of a competent professional should be sought.

The statements and opinions contained in this book are strictly those of the authors and do not represent the official positions of the American College of Healthcare Executives, the Foundation of the American College of Healthcare Executives, or the Association of University Programs in Health Administration.

Copyright © 2019 by the Foundation of the American College of Healthcare Executives. Printed in the United States of America. All rights reserved. This book or parts thereof may not be reproduced in any form without written permission of the publisher.

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Library of Congress Cataloging-in-Publication Data

Names: Nash, David B., editor. | Joshi, Maulik, editor. | Ransom, Elizabeth R., editor. | Ransom, Scott B., editor.

Title: The healthcare quality book : vision, strategy, and tools / David B. Nash, Maulik S. Joshi, Elizabeth R. Ransom, and Scott B. Ransom, editors.

Description: Fourth edition. | Chicago, Illinois ; Association of University Programs in Health Administration : Washington, DC : Health Administration Press, [2019] | Includes bibliographical references and index. | Identifiers: LCCN 2018060062 (print) | LCCN 2019000071 (ebook) | ISBN 9781640550544 (eBook 13) | ISBN 9781640550551 (Xml) | ISBN 9781640550568 (Epub) | ISBN 9781640550575 (Mobi) | ISBN 9781640550537 (print)

Subjects: LCSH: Medical care—United States—Quality control. | Health services administration— United States—Quality control. | Total quality management—United States.

Classification: LCC RA399.A3 (ebook) | LCC RA399.A3 H433 2019 (print) | DDC 362.1068— dc23

LC record available at https://lccn.loc.gov/2018060062

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BRIEF CONTENTS

Foreword .................................................................................................

Brent C. James

Preface xix

David B. Nash, Maulik S. Joshi, Elizabeth R. Ransom, and Scott B. Ransom

Part I The Foundation of Healthcare Quality

Maulik S. Joshi

Chapter 1. Overview of Healthcare Quality 5

Rebecca C. Jaffe, Alexis Wickersham, and Bracken Babula

Chapter 2. History and the Quality Landscape .................................. 49

Norbert Goldfield

Chapter 3. Variation in Medical Practice and Implications for Quality 75

David J. Ballard, Briget da Graca, David Nicewander, and Brett D. Stauffer

Part II Tools, Measures, and Their Applications

Elizabeth R. Ransom

Chapter 4. Data Collection 107

John Byrnes

Chapter 5. Statistical Tools for Quality Improvement ...................... 127 Davis Balestracci

Chapter 6. Physician Profiling and Provider Registries ..................... 171

Bettina Berman and Richard Jacoby

Chapter 7. Health Information Technology in Healthcare Quality and Safety: Prevention, Identification, and Action ....... 189

Sue S. Feldman, Scott E. Buchalter, and Leslie W. Hayes

Chapter

Part

Chapter 9.

Chapter 10.

Chapter 11.

Chapter

Part

Chapter

Hyunjoo Lee and Dimitrios Papanagnou

Chapter

David B. Nash

Deirdre E. Mylod and Thomas H. Lee

David Mayer and Anne J. Gunderson

Kathryn

Scott

Michael S. Barr and Frank Micciche

A. Mark Fendrick and Susan Lynne Oesterle

Neil Goldfarb

Mel L. Nelson, Matthew K. Pickering, Hannah M. Fish, and Laura Cranston

Keith Kosel

DETAILED CONTENTS

Brent

David B. Nash, Maulik S. Joshi, Elizabeth R. Ransom, and Scott B. Ransom

Part III Culture and Leadership

David

Nelson, Matthew K. Pickering, Hannah M. Fish, and Laura Cranston

FOREWORD

The modern quality movement has been building for nearly half a century. Wennberg’s classic study documenting massive geographic variation in healthcare appeared in 1973. In 1987, researchers established that the amount of clinical variation within a single hospital was larger than the variation among geographic regions. By the mid-1990s, Deming’s position that higher quality nearly always reduces operating costs was proving correct. In late 1999, the Institute of Medicine released the To Err Is Human report, which launched patient safety as a critical quality focus. Its 2001 successor, Crossing the Quality Chasm, reflected the voice of the healing professions calling for fundamental reform of healthcare delivery systems. Literally thousands of successful clinical projects, across a wide range of organizations and settings, have given further support for Deming’s premise: The path to financial stability runs through clinical excellence.

But all these years later, has anything really changed? Variation still runs rampant in care delivery services, and patients still suffer unacceptable rates of care-associated injuries and deaths. Costs continue to rise, making essential healthcare services ever less accessible. Why?

Quality improvement theory contains two major parts. The first is data-based problem solving—a set of methods and tools that help identify operational problems, find focused areas for high-leverage change, and then demonstrably fix those problems through measured experimentation. The vast majority of healthcare quality training and most organizational quality initiatives rely on data-based problem solving. However, despite its manifest effectiveness, data-based problem solving innately builds around a series of projects. Clinical researchers sometimes note that “multiple anecdotes do not constitute evidence,” and the same is true in quality: Multiple projects do not constitute health system reform.

The second part of quality improvement is what Deming called a “system of production”—the idea that a masterful enterprise will organize literally everything around value-added frontline work processes. This approach starts with key process analysis, a tool that prioritizes the processes that define any organization, and it builds true transparency, embedding data systems that align to key processes. Management structure follows the process structure. A “system of production” is bottom-up healthcare reform. A number of examples—Allina

Health in Minnesota, Mission Health in North Carolina, and Bellin Health in Michigan, to name a few—have shown that these principles can work just as well in care delivery as they do in other industries.

The volume you hold in your hands is about creating a system that supports quality. It outlines the major, essential components, and it shows how to fit those components together. Properly used, it can serve as an operations manual for healthcare reform, laying a foundation upon which you can build a new future. It holds the keys to a care delivery system that delivers

All the right care, but Only the right care; Without defect or injury; At the lowest necessary cost; Under the full knowledge and control of the patient; while Learning from every case.

Read it, then go forth and conquer.

Brent C. James, MD, MStat Salt Lake City, Utah

PREFACE

Transformation, disruptive innovation, redesign, reform—these popular terms all accurately characterize the state of our current healthcare system and its evolution. The changes we are witnessing today are accelerating at a rate that early pioneers in medicine could not have envisioned. All healthcare organizations are facing the challenges of change as they embark on their individual journeys to provide better care, better service, and better overall health for everyone they serve. All organizations are on a different path and have a different destination. However, they all have one commonality: Quality is the road map. Improving healthcare quality is the essential strategy to survive and thrive in the future. The difference between organizations that are good and those that are great is determined by leadership, and leaders who are masters of quality improvement are the difference makers.

This textbook provides a framework, strategies, and practical tactics to help all healthcare leaders to learn, teach, and lead improvement efforts. This fourth edition has been updated significantly from the previous editions, but once again it has an all-star list of contributors with incredible expertise and breadth of experience. Like the healthcare field itself, this edition has been improved, reimagined, and redesigned. Organized into four sections, the book focuses on the foundation of healthcare quality (part I); tools, measures, and their applications (part II); culture and leadership (part III); and emerging trends (part IV). Individually, and in aggregate, this book is designed to be both an instructional guide and a conversation starter among all students of healthcare quality—that is, all current and future healthcare professionals.

Part I contains three chapters that together provide a foundation for healthcare quality. In chapter 1, Rebecca C. Jaffe, Alexis Wickersham, and Bracken Babula provide an overview of major reports and concepts, Donabedian’s classic structure-process-outcome framework, and methods and tools for quality improvement. The history and the landscape of quality in healthcare are beautifully narrated by Norbert Goldfield in chapter 2. In chapter 3, David J. Ballard and colleagues examine one of the most pervasive and significant issues in healthcare quality—clinical variation. They explain the concept, distinguish between warranted and unwarranted variation, and discuss quality improvement tools that can help manage and reduce unwarranted variation in medical practice.

Part II of the book builds on the foundation and speaks in-depth to tools, measures, and their applications in the pursuit of quality. John Byrnes, in

chapter 4, articulates how data are the foundation of quality and patient safety and how the effective and efficient collection of data is critical to all strategic endeavors to improve quality. Davis Balestracci, in chapter 5, reveals how to apply the appropriate statistical analyses to make the information meaningful. In chapter 6, Bettina Berman and Richard Jacoby expertly apply data to the physician and provider registry domain as another tool for leveraging information for improvement. Information technology (IT) is an engine that uses data as fuel and, in chapter 7, Sue S. Feldman, Scott E. Buchalter, and Leslie W. Hayes describe how organizations use healthcare IT in a three-part cycle of prevention, identification, and action with data and information. Chapter 8 rounds out part II’s focus on applications of data, information, measures, and tools, as Hyunjoo Lee and Dimitrios Papanagnou provide an overview of how simulation, as they say, “can be used to improve healthcare quality and safety by highlighting its intrinsic ability to expose, inform, and improve behaviors that are critical for effective communication and teamwork.”

Whereas part II provides a comprehensive view of the measures, tools, and technologies that are needed to improve quality and safety in healthcare moving forward, part III focuses on what is arguably the key to everything— leadership and culture. To begin this section, Deirdre E. Mylod and Thomas H. Lee, in chapter 9, summarize important aspects of patient satisfaction—a key marker of a patient-centered field. In chapter 10, Craig Clapper, a national expert and teacher in high reliability, reinforces the goals of zero preventable harm and 100 percent appropriate care as cornerstones of a high reliability culture. In chapter 11, David Mayer and Anne J. Gunderson trace the history of the education movement by outlining key milestone papers and symposia, signaling that there are still significant gaps in the teaching of education for healthcare quality. Chapter 12, by Michael D. Pugh, exquisitely details the why and how of dashboards and scorecards as critical leadership system tools for improvement and accountability. The final chapter in this section, chapter 13 by Kathryn C. Peisert, describes the fiduciary responsibility of the board of directors and delineates its central role in the quality and safety debate. Ultimately, the board bears the responsibility for everything in the healthcare organization, including quality and safety.

The textbook concludes with part IV—a compilation of chapters that discuss many of the emerging trends in today’s fast-paced healthcare environment. Lawrence Ward and Rhea E. Powell, in chapter 14, consider the multitude of approaches to improving quality and safety in the ambulatory setting, providing contemporary insights for driving improvements in the delivery of care in primary care and specialty provider offices, ambulatory surgery centers, urgent care centers, retail clinics, freestanding emergency departments, and work-based clinics. In chapter 15, Michael S. Barr and Frank Micciche provide an overview of the National Committee for Quality Assurance (NCQA), from its initial role in helping employers and health plans develop quality standards to

its present-day work in creating systems to measure those standards, including the Healthcare Effectiveness Data and Information Set (HEDIS) measures, health plan accreditation guidelines, the patient-centered medical home model, and various recognition programs.

In chapter 16, A. Mark Fendrick and Susan Lynne Oesterle present the fundamentals of value-based insurance design, another trend that impacts all healthcare stakeholders. Neil Goldfarb then shows us in chapter 17 how purchasers select and pay for healthcare services with a greater focus on value. Mel L. Nelson and her colleagues in chapter 18 provide a pharmacy perspective on achieving greater quality and lower cost through effective medication use. Finally, in chapter 19 by Keith Kosel, we review current thinking on population health quality and safety. Throughout the world, healthcare is changing dramatically. However, that dramatic change will lead to significant advances in patient safety and quality of life only when organizations and healthcare leaders effectively implement quality improvement solutions to our complex problems.

As editors, we use this book extensively, whether for teaching in our courses, as reference material, or for research. The most important use is for leading change within our organizations. We greatly appreciate all the feedback we have received thus far to improve the textbook so that we can all be better leaders and healthcare providers.

Please contact us at doctormaulikjoshi@yahoo.com with your feedback on this edition. Your teaching, learning, and leadership are what will ultimately transform healthcare.

David B. Nash

Maulik S. Joshi

Elizabeth R. Ransom

Scott B. Ransom

Instructor Resources

This book’s Instructor Resources include teaching aids for each chapter, including PowerPoint summaries, answers to the end-of-chapter study questions, and a test bank.

For the most up-to-date information about this book and its Instructor Resources, go to ache.org/HAP and search for the book’s order code (2382).

This book’s Instructor Resources are available to instructors who adopt this book for use in their course. For access information, please email hapbooks@ache.org.

ITHE FOUNDATION OF HEALTHCARE QUALITY

Maulik S. Joshi

Quality is the focal point in the transformation of the healthcare system. A fundamental change in the way care is delivered and financed requires addressing every facet of quality, including

• understanding the gaps and variation from best practices in care and service;

• leveraging data, tools, and information technology to lead quality improvement;

• creating a culture of service excellence, safety, high reliability, and value;

• leading and governing toward population health; and

• engaging with all key stakeholders, such as accrediting bodies, policy makers, payers, purchasers, providers, and consumers.

The three chapters that make up this section of the book provide an overview of quality, trace the history of the quality movement in healthcare, and address the issue of variation in the quality of clinical care. Together, the chapters provide a foundation for leading the healthcare transformation.

Rebecca C. Jaffe and colleagues begin in chapter 1 by providing an overview of major reports and concepts that form the quality foundation. Two Institute of Medicine (IOM) reports—To Err is Human (2000) and Crossing the Quality Chasm (2001)—are truly landmark documents that articulate major deficiencies in the United States healthcare system and define a strategic road map for a future state of improved quality. The reports highlight the severity of medical errors, estimated to account for up to 98,000 deaths and $29 billion per year, and provide a critical classification scheme for understanding quality defects. The categories are underuse (not doing what evidence calls for), misuse (not appropriately executing best practices), and overuse (doing more than is appropriate). The IOM reports also introduce a game-changing

framework for defining six aims of quality: It should be safe, timely, effective, efficient, equitable, and patient centered. Finally, the reports note that, for improvement to be lasting, it must happen at four nested levels—at the level of the patient, the team, the organization, and the environment.

Chapter 1 also discusses the work of Avedis Donabedian, who noted that all evaluations of quality of care could be viewed in terms of one of three measures—structure, process, or outcome. Evaluation based on structure considers characteristics of the people or setting, such as accreditation or physician board certification, that serve as structural quality measures. Assessment of process quality involves measures such as the percentage of diabetic patients receiving a blood sugar test in the previous 12 months, or the percentage of eligible women receiving mammograms. Outcomes, such as mortality rates and self-reported health status, are the ultimate quality measures.

The remaining content in chapter 1 focuses on the methods and tools necessary to achieve the goal of improved quality. Many approaches to quality improvement are available, and all are worth considering. The methods and tools have a variety of names and titles (e.g., the Plan-Do-Study-Act cycle, Six Sigma, Lean), but their success is fundamentally dependent on the culture and capability for executing improvement. Essential to all are the steps of identifying the problem(s), setting measurable aims for improvement, testing interventions, studying data to assess the impact of the interventions, and repeating the cycle of testing and learning. Chapter 1 ends with a discussion of what quality is all about—providing the best care and service to the patient. The concluding case studies highlight opportunities to improve systems of care so that future patients don’t have to face the same problems that have plagued the healthcare field to date.

In chapter 2, Norbert Goldfield describes the history and landscape of quality, introducing us to healthcare quality pioneers such as Walter Shewhart, William Deming, and J. M. Juran. Goldfield places a particular emphasis on Ernest A. Codman, who studied results, or what we now call outcomes. The chapter continues with a discussion of Medicare and Medicaid, which serves as a launchpad for addressing important elements of quality—case mix, risk adjustment, claims and medical records, and, ultimately, payment for quality. Malpractice, consumerism, and the politics of healthcare quality represent both challenges and opportunities for the future of quality improvement. Goldfield’s calls to action apply the learnings from the past to accelerate better quality data and measurement, better quality management, and the implementation of change in the “small-p” politics of healthcare.

In chapter 3, David J. Ballard and colleagues examine one of the most pervasive and vexing issues in healthcare quality—clinical variation. Although variation in medical practice has been studied for nearly a century, John Wennberg and colleagues brought it to the forefront with the development of the

Dartmouth Atlas of Health Care, which accentuated the differences in rates of utilization for many medical procedures in the United States. The color-coded Dartmouth Atlas maps reveal the often-stark differences between counties, even those adjacent to each other, in terms of the rates of procedures. Ballard and colleagues note the tenets of warranted variation, which is based on patient preferences and related factors, and unwarranted variation, which cannot be explained by patient preference or evidence-based medicine. The effects of unwarranted variation are well documented and include inefficient care, excessive costs, and disparities in outcomes. The chapter authors emphasize that the goal is not to merely understand the nature of variation but to implement strategies to reduce unwarranted variation. Building on chapters 1 and 2, chapter 3 notes that positive change requires identifying variation in practice, distinguishing warranted from unwarranted variation, and implementing quality improvement tools to manage and reduce unwarranted variation.

The foundation of quality requires us to acknowledge history’s lessons to create a better future. Today’s challenges are not completely new; many healthcare pioneers studied the early dimensions of quality measurement and management long ago. Sentinel reports and studies over the last two decades have called attention to major gaps in quality, as well as strategies and tools to get quality to where we want it to be. Even with all of this knowledge and evidence in hand, however, we are still confronted by the ubiquitous variation in quality of care. Looking to the future, we must address this variation to ensure that the right care is provided to the right patients at the right time and place.

OVERVIEW OF HEALTHCARE QUALITY

Rebecca C. Jaffe, Alexis Wickersham, and Bracken Babula

The Growing Focus on Quality

The quality of the US healthcare system is not what it could be. Around the end of the twentieth century and the start of the twenty-first, a number of reports presented strong evidence of widespread quality deficiencies and highlighted a need for substantial change to ensure high-quality care for all patients. Among the major reports driving the imperative for quality improvement were the following:

• “The Urgent Need to Improve Health Care Quality” by the Institute of Medicine (IOM) National Roundtable on Health Care Quality (Chassin and Galvin 1998)

• IOM’s To Err Is Human: Building a Safer Health System (Kohn, Corrigan, and Donaldson 2000)

• IOM’s Crossing the Quality Chasm: A New Health System for the 21st Century (IOM 2001)

• The National Healthcare Quality Report, published annually by the Agency for Healthcare Research and Quality (AHRQ) since 2003

• The National Academies of Sciences, Engineering, and Medicine’s Improving Diagnosis in Health Care (National Academies 2015)

Years after these reports were first published, they continue to make a tremendous, vital statement. They call for action, drawing attention to gaps in care and identifying opportunities to significantly improve the quality of healthcare in the United States.

“The Urgent Need to Improve Health Care Quality”

Published in 1998, the IOM’s National Roundtable report “The Urgent Need to Improve Health Care Quality” included two notable contributions to the quality movement. The first was an assessment of the current state of quality (Chassin and Galvin 1998, 1000): “Serious and widespread quality problems exist throughout American medicine. These problems . . . occur in small and

large communities alike, in all parts of the country, and with approximately equal frequency in managed care and fee-for-service systems of care. Very large numbers of Americans are harmed.” The second contribution was the categorization of quality defects into three broad categories: underuse, overuse, and misuse. This classification scheme has become a common nosology for quality defects and can be summarized as follows:

• Underuse occurs when scientifically sound practices are not used as often as they should be. For example, only 72 percent of women between the ages of 50 and 74 reported having a mammogram within the past two years (White et al. 2015). In other words, nearly one in four women does not receive treatment consistent with evidence-based guidelines.

• Overuse occurs when treatments and practices are used to a greater extent than evidence deems appropriate. Examples of overuse include imaging studies for diagnosis of acute low-back pain and the prescription of antibiotics for acute bronchitis.

• Misuse occurs when clinical care processes are not executed properly— for example, when the wrong drug is prescribed or the correct drug is prescribed but incorrectly administered.

To Err Is Human: Building a Safer Health System

Although the healthcare community had been cognizant of its quality challenges for years, the 2000 publication of the IOM’s To Err Is Human exposed the severity and prevalence of these problems in a way that captured the attention of a large variety of key stakeholders for the first time. The executive summary of To Err Is Human begins with the following headlines (Kohn, Corrigan, and Donaldson 2000, 1–2):

The knowledgeable health reporter for the Boston Globe, Betsy Lehman, died from an overdose during chemotherapy. . . .

Ben Kolb was eight years old when he died during “minor” surgery due to a drug mix-up. . . .

[A]t least 44,000 Americans die each year as a result of medical errors. . . . [T]he number may be as high as 98,000. . . .

Total national costs . . . of preventable adverse events . . . are estimated to be between $17 billion and $29 billion, of which health care costs represent over one-half.

Although many people had spoken about improving healthcare in the past, this report focused on patient harm and medical errors in an unprecedented way, presenting them as perhaps the most urgent forms of quality defects. To Err Is Human framed the problem in a manner that was accessible