Episode grouper software offers a potential framework for developing important components of a pay-for-performance system for healthcare providers.
If the costs for treating health conditions can be computed, then policymakers can in principle benchmark different providers' cost distributions and reward the most efficient. This article applies two of the most prominent commercial groupers and examines the properties of the cost distributions calculated for their constructed episodes.
The analysis reveals that episode cost distributions exhibit substantial variation and skewness, suggesting the need for innovative risk adjustment methods prior to utilizing groupers for the purpose of physician profiling. One technology suggested by many in the policy and healthcare communities as offering a framework for measuring physician performance is episode grouping software. This software allots health-care claims e.
In principle, episodes produced by groupers provide a data source for profiling the resource utilization of individual physicians benchmarked against episode-based standards, such as the mean cost per episode, or against a composite performance measure that integrates rankings across types of episodes within relevant peer groups.
The Medicare Payment Advisory Commission MedPAC examined episode grouping software and concluded on a preliminary basis, that these products have face validity from a clinical perspective, seem to be able to identify practice patterns, and possess risk adjustment capabilities that could account for differences in disease severity and the presence of co-morbidities MedPAC, , ,
Need for Risk Adjustment in Adapting Episode Grouping Software to Medicare Data
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