Reporting Framework for Value Based Care
Learn how a provider's relative performance, or 'value', can be evaluated through three key components in an equation: quality, efficiency, and cost.
Evaluating the relationship between episode of care and length of stay in Appendicitis:
In previous posts we have discussed some of the ways episodes of care can be used to compare two different networks and underlying practice patterns. We’d like to dive further on this thread and look at how episodes of care can be used to explore the relationship between cost and length of stay (LOS).
How do Episode Groupers Work?
An episode of care is a summary of care across all care settings for a particular patient’s condition. For example, if patient breaks their wrist after a fall. They would likely go to the emergency room, receive an X-Ray, multiple procedures, and a prescription for the pain. The patient then may require follow up visits with an orthopedist, and physical therapy for rehabilitation. An episode of care combines all of these costs so the true cost of a broken wrist can be assessed.
Adjusting your Population for Severity
One of the features of episode groupers on the market today is the ability to segment condition by severity. Severity generally refers to if the episode has complications and how severe those complications are. Consider the example below. We have a summary of complete episodes of Appendicitis with two different severity levels. Provider Network 1 handles more cases of higher complexity appendicitis and has a significantly lower average cost per case at both severity levels.
To better understand the cost drivers of this episode we dug into the inpatient costs and length of stays associated with the Appendicitis episodes. In the table below we have limited our output to the inpatient hospital claims to investigate the impact of the facility costs on the cost disparity. Provider Network 1 handles the majority of the higher severity stays at a lower cost, but a significantly higher length of stay. However, even the lower severity stays appear to spend almost a full day more in an inpatient facility. The longer lengths of stay are telling that even though there may be lower costs with Provider Network 1 they are utilizing more medical resources to deliver care than Provider Network 2.
In this case episode grouping has helped to identify an unexpected relationship between a lower cost per episode provider for appendicitis and a longer length of stay. Length of stay efficiency opportunities appear to exist for Provider Network 1 which could help further reduce the costs of these episodes and the profitability of the provider.