News Release

Executive Order Is Helping “Change the Culture” in Health Care to Achieve Better Quality, Value, and Affordability, HHS Secretary Leavitt Reports

Important steps toward widespread public reporting of quality and price in health care have been achieved in the year since President Bush issued an Executive Order mandating action by federal health agencies, Health and Human Services (HHS) Secretary Mike Leavitt said today.

Highlighting the first year of Executive Order 13410, Secretary Leavitt released summaries from four federal departments and agencies surveying their actions toward achieving the goals of the Presidential directive.  He also praised similar actions across the private sector, including steps by health plans, health care providers, employers, unions, and others.

“In its first year, the President’s Executive Order has begun to have a culture-changing effect in the health care sector,” Secretary Leavitt said.  “For the first time, we are working effectively together to make possible reliable and consistent measures of quality and price.  This is the foundation we must have for a future of affordable, effective, and high quality health care.”

The Executive Order, centered on four “cornerstone” goals, is helping bring about a systematic approach for measuring quality and value in health care, and for making that information publicly available.  By mandating action for federal agencies, the order applied to a substantial portion of the U.S. health care market.  But at the same time the approach has helped stimulate and coordinate action by the private sector.

The four cornerstone goals of the Executive Order are:

• Connecting the system through the adoption of interoperable health information technology;
• Measuring and making available results on the quality of health care delivery;
• Measuring and making available price information on the costs of health care items and services; and
• Aligning incentives so that payers, providers, and patients benefit when care delivery is focused on achieving the best value of health care at the lowest cost.

“These cornerstones represent very substantial commitments and changes for health programs, and we are pleased to be able to report that substantial first year progress has been made across federal agencies since August 2006,” said Secretary Leavitt.  “Value and affordability are the crucial underpinnings for making our health care system work as it must, including our goal to make affordable insurance coverage accessible for all Americans.”

Examples of first-year accomplishments by federal agencies, as well as plans for fiscal year 2008, include:

Supporting interoperable health information technology:

• HHS, through the Office of the National Coordinator for Health Information Technology (ONC), has successfully piloted models for a Nationwide Health Information Network (NHIN). Using the internet, the NHIN will be a network of networks that will connect health information exchanges in different markets to enable the secure and confidential sharing of health information across the health care system.  In fiscal year 2008, ONC will begin trial implementations of competing prototypes that have been demonstrated as viable models for the NHIN.  
• Federal departments and agencies are coordinating and adopting consistent contract language that will require the use of newly developed and soon-to-be recognized interoperability standards.  Beginning in their next contracting cycle, agency contracts will include this language, requiring the use, where available, of health IT that meets recognized interoperability standards.
• The Departments of Defense (DoD) and Veterans Affairs (VA) are collaborating to an unprecedented degree in health information exchange across diverse information technology systems to vastly improve the information available to caregivers who treat our nation’s service members and veterans.

Committing to transparent and reliable price and quality reporting and incentives:

• The Office of Personnel Management (OPM), which administers the Federal Employees Health Benefits Program, is promoting health care price and quality transparency through its contracts with private sector insurance carriers and is also requiring them to report on new quality of care measures.  This fall, federal employees will see enhanced consumer information on price and quality transparency in the 2007 Guide to Federal Benefits on OPM’s Web site.
• The Centers for Medicare & Medicaid Services (CMS) provides a full payment update to hospitals that report on a core set of quality measures for patients with heart failure, heart disease, pneumonia, or having surgery (surgical infection prevention).  In June 2007, CMS added two mortality measures for heart attack and heart failure and plans to add measures of patient satisfaction by spring 2008.  In addition, last month CMS began collecting quality information from participating physicians which will become the basis for bonus payments to be paid mid-2008.  These incentive payments will be based upon the submission of applicable consensus-based quality measures.
• HHS is also recognizing and promoting community collaboration underway across the country in support of the four cornerstones.  Under a new initiative set to begin this quarter, communities which have organized themselves according to certain criteria will become eligible to participate in a learning network where they can gain access to the tools, resources, and training available through HHS.

The Executive Order has also helped private sector payers and health professionals in coordinating efforts to improve quality and price reporting as well as expand use of interoperable health information technology and align incentives for achieving value.

More than 800 employers and over 20 states have recognized this Executive Order through signed public declarations supporting the four cornerstones.  As a result, more than 100 million insured American lives are now impacted by the goals laid out in the Executive Order. 

“It is especially gratifying that through the Administration’s leadership, substantial progress is also being made in the private sector toward these same goals,” Secretary Leavitt said.

This week, reports have been issued from organizations and coalitions that support this move toward greater value.  These reports demonstrate a growing awareness of the need to measure the progress of the health care marketplace toward the four cornerstones.  They also reveal an increased level of marketplace collaboration among and between payers, providers, plans and consumers.  These private sector efforts represent an important contribution to the vision that we share.  More information on public and private sector efforts is available at http://www.hhs.gov/valuedriven.  

“We believe this Executive Order has served as a catalyst for encouraging our health care system to provide the coordination and information necessary to become more effective and affordable,” said Assistant to the President for Economic Policy Allan Hubbard.  ”We look forward to even more important results and better access to quality and value information for consumers, payers, and providers alike in the coming years.”

The complete summaries from HHS, OPM, DoD, and VA can be found online at http://www.hhs.gov/valuedriven/federal/eoreport.pdf.

###

Note: All HHS press releases, fact sheets and other press materials are available at http://www.hhs.gov/news.

Last revised: August 29, 2008