Walmart and Centers of Excellence

This is the original article from Harvard Business Review on Walmart's (and others) approach to healthcare and the Centers of Excellence idea. I encourage anyone interested in this topic to read the entire article critically rather than take at face value the headlines or cursory posts about it.

To be clear, I think what these companies and centers are doing is great: they got tired of waiting for the system to fix itself and took matters into their own hands. That being said, I do have some concerns.

It is not clear to me from the article if the COE v. non-COE comparison for length of stay, readmissions, complications, etc. was for a matched set of patients. Non-COE patients are likely on average older (per the article, the COE joint replacement patients were mostly under the age of 64) and less healthy and therefore higher risk. Therefore, this might not be an apples-to-apples comparison and would make the COEs look comparatively better when in fact there is selection bias.

Much of the benefit was achieved by offering a second opinion not to operate. Obviously this saves the companies money, but that does not guarantee it was the right decision. The bias is to assume the COE opinion was correct, but COEs are at least somewhat incentivized to reduce cost by offering less surgery. In addition, it appears as though much of the workup and non-operative management is done by a local non-COE provider before a COE physician reviews the record. It seems unfair to have the COE then cherry pick that patient for the procedure if they agree with the decision for surgery. Presumably, the non-COE physician invested time and effort in evaluating the patient and establishing a relationship. What if the provider and local hospital provide equal (or even better) outcomes and better cost savings?

The article seems to imply that some patients were advised not to have joint replacement because of health reasons (reading between the lines, this likely includes morbidly obese patients and smokers). It is easier to deny a patient surgery after an impersonal records review than if that patient is sitting across from you during an office visit. Some of those patients may have then sought treatment in their local community and may have been offered surgery by another physician willing to accept the higher risk (and perhaps the lower "rating") to try to help the patient.

Another area of concern is the delivery of postoperative care. The article seems to suggest that this was delegated to the patient's primary care physician. Is it safe and advisable to have the PCP providing postop care? Should local specialists who were bypassed for the index surgery be expected to deal with any complication that arises and needs emergent attention? Are patients less likely to be re-admitted to the hospital or seek care in the emergency room if their procedure was performed in a completely different geographic location?

Patients in this system are significantly incentivized to seek care at the designated COE (as well as dis-incentivized to have care at a local non-COE in the form of what is essentially a financial penalty). This may introduce bias toward the COEs. 

To me, the take home is that properly selected patients who undergo surgery utilizing evidence-based, coordinated approaches do better and save the system money. No great revelation there. Medicare bundled payment systems have spurred many facilities and surgeons to adopt very similar measures. What if Wal-Mart and other companies eliminated the travel aspect and worked to identify local physicians and facilities that could match or beat the so-called Centers of Excellence? 

I believe in the Centers of Excellence idea, but let's take it a step further. Let's make it available to all patients regardless of age, co-morbidity, and whether or not they work for a large company such as Wal-Mart or Lowe's. These arrangements are evidence that, when done right, many otherwise cost prohibitive procedures can be made more affordable while avoiding a race to the bottom and shunting of funds away from those providing the care. What if we were able to reduce costs for elective procedures to the point that patients don’t need insurance to pay for them? What if you built a facility (or network of facilities) capable of delivering high quality, patient centered care locally to the majority of patients (not just the healthiest and lowest risk)? Wouldn’t that be a Center of Excellence too?