Protecting, maintaining and
improving the health of all Minnesotans
Timeliness of data
What Is The Issue?
In reporting cost and quality data to consumers, ideally the data sets would be as timely as possible and would
measure the same time period. In practice, this ideal is difficult to achieve and so a choice must be made
between having the timeliest data available or having data from concurrent time periods. Is it necessary for the
dates of service for quality measures to coincide with those of the cost measures? Which would be least
confusing to consumers as they use Provider Peer Grouping (PPG) data to choose high-value providers: seeing
data from two different time periods, or seeing quality data that may differ from what is reported elsewhere?
MDH obtains quality measures for PPG through a variety of publicly available sources, including Minnesota’s
own Statewide Quality Reporting and Measurement System. A complete data set for the quality measures is
available approximately three to six months following the close of a calendar year. MDH develops the cost
measures and certain additional clinic based quality measures for PPG using de-identified claims data from the
state’s All-Payer Claims Database. Until recently, MDH encountered a time lag of 20 months after the close of a
given calendar year in submitting data from the Centers for Medicare and Medicaid Services (CMS) to the data
base. However, Minnesota and other states have negotiated with CMS an alternative data delivery model that
will decrease this lag dramatically in 2013 and beyond to 12 months.
Minn. Stat. 62U.04, which creates the PPG system, originally required the development of a single combined
measure of cost and quality that would enable a comparison of providers’ relative value (the amount of quality
per dollar of cost). The combined measure ideally called for cost and quality measures roughly based on
concurrent dates of service – not all quality measures are measured and reported on a calendar year schedule.
With the current time lag in the availability of cost data from CMS, this would result in the use of quality data
that is approximately two years old. Under this scenario, consumers seeking provider information would
potentially encounter quality data in PPG that differs from more recent quality data reported elsewhere.
For a number of reasons, the 2009 PPG Advisory Group recommended that value of a provider be represented
not in a single measure but through a combined display of the individual components of cost and quality.
Furthermore, the requirement to produce a combined measure was removed from the authorizing legislation in
the 2012 legislative session. This change in the statute opens up the possibility of using data with nonconcurrent service dates so that the most recent quality data may be used. At the same time, the 2012
Legislature also directed that data used for the PPG analysis must be the most recent data available. This may be
interpreted as the most recent cost data and the most recent quality data, or may be interpreted as data for the
most recent time period for which there is both cost and quality data available.
What Past Decisions Have Been Made?
In developing its initial methodology, MDH determined that because a combined measure of cost and quality
was being developed, quality and cost data from concurrent dates of service needed to be used. It was also
thought to be more intuitive for consumers, the primary clients for PPG results.
What Are The Options?
Option 1: Continue to use concurrent dates of service for quality and the cost data, retaining the possibility of
computing a single relative value measure. Specifically, PPG analysis would be based on the most recent
available cost data with quality data from the corresponding time period. Given the new CMS data acquisition
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Protecting, maintaining and
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process, PPG results could be available approximately fifteen months after the end of the current measurement
period (Exhibit).
Option 2: Allow for non-concurrent dates of service between the quality and the cost data, reporting each
dimension separately and making the reporting of a combined relative value measure less meaningful.
Specifically, PPG would be based on the most recent available data for cost and the most recent data available
for quality. The resulting lag would be approximately twelve to fifteen months for the cost data but less than
twelve months for quality data.
Option 3: Allow non-concurrent dates of service for separate reporting of cost and quality measures, but retain
the goal to develop a single relative value measure based on concurrent dates of service. In this approach, the
data lag for the separate cost and quality measures would be similar to option #2. However, a relative value
measure would also be developed using concurrent service dates requiring the twelve-fifteen month lag.
What Are the Considerations (advantages/disadvantages)?
Option 1: The primary advantage of option #1 is that a meaningful relative value measure can be developed.
While this requirement has been removed, it remains a major goal for PPG to empower consumers to choose
high value health care. There is substantial research demonstrating that consumers prefer to receive concise
information with visually limited display options. Presenting a single relative value measure in addition to
separate quality and cost measures may more effectively meet this goal.
The primary disadvantage is that provider quality is evaluated with data that is not as recent as possible.
Providers who exhibit rapid improvements in quality within a year would be potentially disadvantaged.
Furthermore, consumers who seek provider information from multiple sources might be confused by the
inconsistent information that is available.
Option 2: The advantage of this approach is that PPG results will more accurately reflect providers’ current state
of quality, resulting in more actionable information for providers and consumers.
The disadvantage is that the PPG reports will not provide a meaningful single measure of relative value or
efficiency upon which to compare providers.
Option 3: This option would ensure that the quality information in PPG is as timely as possible, while retaining
the benefits to consumers associated with the simplicity of a single measure of value.
The added complexity required to generate multiple measures is a disadvantage, as is the need to communicate
to consumers the difference in dates of service underlying the various measures.
Specific Questions on Which We Seek Advisory Group Input
1) Should PPG maintain the goal of developing a single combined measure of relative value in addition to the
separate components of cost and quality? If so, should the time period for cost and quality data be
concurrent or non-concurrent?
2) Until CMS data acquisition has been shortened reliably to 12-15 months, should PPG should use the most
recent quality data, resulting in non-concurrent data populating the final results?
3) If improvements in CMS data acquisition allow for concurrent reporting of cost and quality using data that is
approximately fifteen months old, should PPG give preference to concurrent data use or using the most
recent quality data?
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improving the health of all Minnesotans
Exhibit:
1
2
Hospital Data: Monthly Time Lag in Availablity of Data From End of Calendar Year
3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Current for 2010 Dates of Service
Cost Data
Medicare
Medicaid
Commercial
Quality Data
3 to 6 months
2011
Anticipated for 2012 Dates of Service
Cost Data
2013
Medicare
Medicaid
Commercial
Quality Data
3 to 6 months
2012
Analysis
and Report
3 to 6 months
2014
Analysis
and Report
3 to 6 months
85 East Seventh Place • PO Box 64882• St. Paul, MN, 55164-0882 • (651) 201-3560
http://www.health.state.mn.us
An equal opportunity employer
Protecting, maintaining and
improving the health of all Minnesotans
Definition and Number of Peer Groups for Hospital and Clinic PPG Reports
What is the Issue?
The composition of peer groups is central to this project’s mission, the production of unbiased and informative
reports for consumers comparing hospitals and clinics to their peers on their quality and cost performance.
However, because of the wide variety of ways in which health care institutions vary in setting, organizational
structure, methods of care delivery and patient groups served, it is difficult to imagine groups of perfectly
comparable providers. In lieu of perfection, the Provider Peer Grouping system’s goals are to:
1. Achieve like-to-like comparability within hospital and clinic peer groups. Members of a peer group should be
as similar as possible with respect to clinical practice, organizational or reimbursement factors that:
a. fundamentally influence quality and/or cost performance,
b. cannot be sufficiently equalized by risk adjustment methods and other tools (e.g., outlier treatment).
2. Define peer groups that:
a. support actionable comparisons that are relevant to choices faced by consumers and payers;
b. reflect provider responsibility for care coordination and the influence of their decisions and practice on
all health care services received by their patients, costs for those services, and care outcomes.
What Past Decisions Have Been Made?
For inclusion in total cost of care reports, hospitals and clinics must have sufficient quality measure data to allow
computation of domain-specific and total quality composite scores. The decision about the number and
composition of peer groups was informed by the understanding that in choosing a health care provider,
consumers do not typically consider provider differences unless it is directly applicable to their health care need
(e.g. the use of an ER). In other words, to meaningfully assist consumers, peer groups were structured to be as
broad as possible.
Hospital Analysis: There are two acute care hospital peer groups, one for prospective payment system (PPS)
hospitals and one for critical access hospitals (CAHs).
Clinic Analysis:

Clinic total cost of care analysis will include primary care clinics and multi-specialty clinics that provide
primary care. This includes a broad range of clinical specialties that involve ongoing care coordination and
management by providers. In deciding which clinics should be included in the peer group, a MDHdeveloped measure known as the Primary Care Service Index (PCSI) will be used to determine whether
clinics have staff capacity to provide a certain level of primary care (vs. other specialty care).

Currently it is planned that all clinics be included in a single peer group for clinic total cost of care analysis.
This decision was based on discussion by the PPG Advisory Group in which it was assumed that risk
adjustment would be sufficient for adjustment.
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What Are The Options?
Clinic Peer Grouping:
Option 1: All clinics could be included in a single peer group (the current plan).
Option 2: The decision could be made now to break clinics into more than one peer group based on
organizational characteristics or location.
Option 3: The decision to include additional clinic peer groups could be postponed for consideration until an
initial analysis is completed that indicates the degree to risk adjustment and related tools are sufficient to
ensure fair provider comparisons.
Hospital Peer Grouping:
Option 1: Hospitals could be divided into two peer groups, one for CAH and one for PPG hospitals (current plan).
Option 2: The decision to have two hospital peer groups could be revisited.
What Are the Considerations (advantages/disadvantages)?
1. Reporting based on more than one clinic subgroup enhances the statistical performance and perceived
validity of the reports by permitting “apples to apples” comparisons. This may improve the acceptability of
the reports among many health care providers.
2. Possible disadvantages of more than one clinic peer group include:
a. It may be difficult to explain distinctions between clinic peer groups to consumers. Further, presenting
reports across more than one peer group may reduce usability for consumers.
b. If separate peer groups are established from the start, it won’t be possible to assess differences among
clinics based on the criteria defining the peer group.
c. More but small peer groups may result in an insufficient number of observations (e.g. clinic visits in
certain clinical categories) in a peer group to make stable risk adjustments or comparisons.
d. Added complexity, additional work time and resource use to produce the provider and public reports.
e. Additional data will be needed to unambiguously classify peer groups.
Specific Questions on Which We Seek Advisory Group Input
Clinic Peer Grouping:
1. Should the current choice to include all clinics in one peer group be revisited?
a. If yes, which group (Advisory Committee, Rapid Response Team (RRT), or further work by Mathematica
and MDH, with referral to RRT) should give substantive direction/detailed feedback?
b. If yes, what is the potential impact on quality assessment?
c. Should this decision be made prior to the start of clinic total care analysis or following data exploration?
Hospital Peer Grouping:
2. Are two peer groups for hospitals sufficient and if not how should hospital peer groups be constructed to
avoid issues and disadvantages highlighted in the considerations section?
85 East Seventh Place • PO Box 64882• St. Paul, MN, 55164-0882 • (651) 201-3560
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Protecting, maintaining and
improving the health of all Minnesotans
Defining the Unit of Analysis – What is a Provider?
What Is The Issue?
Provider organizations are not all organized in similar fashion. The first iteration of Provider Peer
Grouping (PPG) analysis showed that differences in organizational structure within health systems may
impact the results of cost and quality reporting and comparisons for clinics and hospitals. Analyzing
insurance claims data in ways that do not incorporate those organizational nuances may create an
unfair advantage or disadvantage (introduce a bias) in the results for certain providers. An example of
this issue would include a health system in which particular types of patients are only seen at or
admitted to a specific practice location (clinic or hospital).
What Past Decisions Have Been Made?
1) Members of the 2009 PPG Advisory Group concluded that consumers would receive more useful
information by looking at results in which they could compare specific clinics or hospitals rather than
results for care systems or medical groups more broadly. The rationale for this conclusion was that
internal differences can and do exist across facilities and clinics within a care system and that those
differences are important to consumers.
There was a perceived common understanding of “hospital” and “clinic” to mean a single place of
service for the delivery of health care. Operationalizing this concept initially seemed relatively easy.
2) Hospitals: While the analysis compares Critical Access hospitals (CAH) and Prospective Payment
System (PPS) hospitals in separate peer groups, initially single stand-alone hospitals were compared
within those peer groups rather than selectively rolled up into a combined hospital entity and then
compared. (The analysis did not allow the existence of separate units within a single hospital
campus to exist as smaller “independent” hospitals.) The 2009 advisory group recommended
comparing individual physicians/surgeons on specific medical condition analysis and the hospital for
the total cost of care comparison. As the Centers for Medicare & Medicaid Services rules prohibit
this type of analysis in which physician Medicare incomes can be calculated, this approach was not
further pursued.
3) Clinics: The 2009 Advisory Group recommended that, wherever possible, peer grouping should
occur at the clinic site level, although there were concerns among the Group about the practicality
of doing so. Group members recommended peer grouping at the medical group level only if clinic
site peer grouping was not feasible.
Analysis has been progressing based on the original assumption that individual clinics would stand
alone for purposes of cost and quality comparisons. Clinics and staff are self-identified through
registration under the State Quality Reporting and Measurement system. Clinics with staffing
capacity to provide mostly specialized care are not included in the PPG reporting framework.
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Protecting, maintaining and
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What Are The Options?
Hospitals:
Option 1: Define hospitals by distinct practice location (the current option), or
Option 2: Combine certain hospitals within care systems that exist as physically separate practice
locations within a medical campus but nonetheless use a business/practice model, operating as if they
are one hospital with more than one location, each of which specializes in a certain type of patients.
Clinics:
Option 1: Define primary care clinics by separate physical practice location and with reference to
information about physician staff and outputs gathered from physician registry (the current option), or
Option 2: Combine certain clinics within care systems that exist in separate physical locations but
nonetheless use a business/practice model operating as if they are one single clinic with more than one
location, each of which treats a certain type of patient.
What Are the Considerations (advantages/disadvantages)?
1) Changes will require devising an operational method to identify providers using the shared facility
practice model and the additional burden this may place on providers to provide better information
about their practice / business model.
2) Certain data needs to be available at the unit of analysis to support the decision;
3) Evaluate the impact against the goal of making reasonable comparisons for provider performance;
4) Impact of the decision on provider ability to identify areas for improvement efforts at particular
practice locations needs to be considered;
5) Impact of the decision on consumer capacity to understand peer grouping reports and make
informed decisions in selecting a health care provider; and
6) For consistency with PPG principles, current community practice in cost and quality reporting
methods need to be considered as part of the decision.
Specific Questions on Which We Seek Advisory Group Input
1) Should certain hospitals with separate practice locations within a care system be combined when
functioning as a single entity within a medical campus?
2) Should certain clinics within a care system be combined to create a single practice location?
For questions 1 and 2 address the following:
a. Always or Never and why?
b. Only under certain practice, organizational, or structural conditions
 What specific conditions?
 How can we identify those conditions and combinations?
 How might this practice of combining for some but not for all effect the results of
the cost and quality measures and their comparison across systems?
85 East Seventh Place • PO Box 64882• St. Paul, MN, 55164-0882 • (651) 201-3560
http://www.health.state.mn.us
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