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The RAND Corporation’s Dash for Health Care Reform

by Marlene Piturro, PhD, MBA •

Effective Health Care Dashboards

Navigating the increasingly complex health care system requires a set of tools that smooth the way. Dashboards are a subset of decision-support tools that can help health care administrators and providers filter the staggering amount of data bombarding them.

Although dashboards are intuitive and user-friendly, they are only as good as their underlying assumptions and data. To be effective a dashboard:

  • Has a balanced set of performance measures.
  • Selects a manageable set of measures (15-30).
  • Presents data in graphic displays.
  • Highlights action triggers.

 

Health care dashboard categories usually measure:

  • Financial performance.
  • Operational effectiveness/efficiency.
  • Quality.
  • Patient satisfaction.

 

A Close Look at One Policy Option

Closely examining the RAND dashboard for the policy option labeled individual mandate reveals questionable assumptions and outright disregard for the actual performance of the largest experiment with the individual mandate, the Massachusetts plan enacted in 2006.

RANDCOMPARE said that individual mandates will have no effect on spending in the aggregate, which will increase by only $7 billion to $26 billion, or 0.3% to 1.2% of total national spending, indistinguishable from zero. Tell that to the people of Massachusetts, who faced a $147 million shortfall in the program’s first year and a $130 million deficit halfway through the second year.

The mandate’s price tag in 2006 dollars-$3500 and $10,000 for individual and family insurance, respectively, including deductibles of $2000 and $4000, respectively-contradicts RAND’s estimate that individual mandates show no discernable change in consumer financial risk for the non-elderly. The analysis contradicts itself by adding: the median proportion of income spent on health care increases substantially among those who become newly insured (emphasis added).

Moving along the dashboard, RANDCOMPARE makes these predictions for the next four variables: reliability (no effect), patient experience (improve), health (improve), and coverage (increase). The underlying assumption-that having health insurance will improve access to care-is accepted, although no empirical evidence exists. It boldly continues, projecting nationally, that an estimated four million life years will occur and the mandate will increase coverage by 9-14 million. It assumes that there will be no effect on the health care system’s capacity, without indicating who will care for those additional millions of patients. On operational feasibility, it concludes, difficult, because determining compliance with the mandate and enforcing penalties for noncompliance are large tasks.

Since one of RANDCOMPARE’s stated goals is to detect the unintended consequences of policy options, it should have reported that Massachusetts’ two-year experience with the individual mandate has increased costs for individuals and the state, reduced revenues for doctors and hospitals, and decreased access in a state with an abundance of physicians. As of the end of 2008, state costs rose more than $400 million (85% above projections) and new patients waited an average of three months to see a doctor. This is not for lack of doctors but for physician unwillingness to accept the Connector’s pay scale, and lose money every time they see a new patient.