Hospitals Prescribe Big Data to Track Doctors at Work

Marnie Baker, a pediatrician at California’s MemorialCare Health System, has an easy manner and ready smile. Now, though, her job is to be the bearer of a serious and, for some of her colleagues, unwelcome message.

She’s the voice of a program that digitally tracks their performance, informs them when they don’t measure up—and cajoles them to improve.

MemorialCare is part of a movement by hospitals around the U.S. to change how doctors practice by monitoring their progress toward goals, such as giving recommended mammograms. It isn’t always an easy sell. At one clinic earlier this year, physicians grilled Dr. Baker, who is director of performance improvement at a MemorialCare-affiliated physician group.

Cardiologist Venkat Warren said he worried that “some bean-counter will decide what performance is.” He wondered whether doctors would be pushed to avoid older and sicker patients who might drag down their numbers.

“If it isn’t cost-cutting, what is it?” Dr. Warren asked.

“It’s providing better value,” Dr. Baker responded.

Encounters like these are one result of the changes sweeping American health care. Technology is making it easier to monitor doctors’ work as patients’ details are compiled electronically instead of on paper charts. Software makers are selling new tools to crunch the data. Software called Crimson offered by the Advisory Board Co. ABCO -1.54%now includes information on more than a half-million doctors, up from fewer than 50,000 in 2009.

At the same time, more physicians are going to work for hospital systems, which are under pressure to hit quality goals and cut costs. Many are striking deals with insurers that pull them away from traditional “fee-for-service” reimbursement, which pays for medical procedures individually.

Insurers—which themselves increasingly track physician results—are moving toward providing a set payment for the overall care of a patient. This system means that doctors who provide costlier-than-average care could break the budget.

The federal health law is speeding these trends. Under the law, hospital payments and penalties from the federal Medicare program will be linked to their performance on quality gauges, particularly rehospitalizations, which are costly. The law also created a new Medicare initiative for “accountable care organizations,” providers that get extra rewards for efficiency and quality performance.

To succeed under the new health-care economics, hospital executives say, they must lean on doctors, who make nearly all the key decisions on what treatments, tests and drugs patients get. “The last frontier is the physicians,” says Thomas Heleotis, vice president of clinical effectiveness at Monmouth Medical Center, part of New Jersey’s seven-hospital Barnabas Health system.

A few years ago, he ordered up a list of the 20 physicians practicing at Monmouth who were costing the most money and sat down with each to go over their data. Several trimmed services like repeat lab tests and daily X-rays, he says, and those 20 are no longer among the costliest. Their patient-mortality and complication rates also improved, he says.

Some of this has been tried before, with mixed results. In the 1990s, hospitals bought up doctor groups, and insurers tried paying for care based on per-patient fees instead of charges for each service. Patients and doctors pushed back, and many of these initiatives failed financially. Tying doctors’ pay to their performance isn’t a new idea, either, and the effectiveness is debated.

What is different this time, some hospital executives argue, is that new technology enables closer, faster tracking of individual doctors, and the new insurance payments factor in quality goals. But partly because many of the efforts are new, broad results are scarce. The Advisory Board says that among hospitals using its software for three years, lengths of inpatient stays fell 2.9%, on average, and readmissions fell 4.5%.

Hospital executives nationwide say that many doctors, particularly younger ones, are receptive. But others feel second-guessed. “The whole way you get trained is to be the decider, the captain of the ship,” says Michael Sills, a cardiologist and technology executive at Baylor Health Care System in Texas. Now someone will be “monitoring their productivity, monitoring their costs. They’re not going to like it one little bit.”

Leery of sparking doctor revolts, hospitals are delivering the feedback in sessions led by fellow physicians like Dr. Baker at MemorialCare, not outsiders. Executives refer to their efforts as “aligning” with physicians, not telling them what to do.

MemorialCare, a six-hospital nonprofit based in Fountain Valley, Calif., is keeping detailed data on how the doctors at its affiliated medical group perform on many measures—including adolescent immunizations, mammograms and keeping down the blood-sugar levels of diabetes patients. The results are compiled, number-crunched and eventually used to help determine how much money doctors will earn.

To get doctors on board, Dr. Baker points out that the group’s results will be made public as part of a statewide California initiative overseen by a nonprofit. She has also resorted to humor, including some poetry last fall at a physicians’ meeting:

“So order those mammos and colonoscopies too / HPV vaccine will keep warts away from you!”

MemorialCare’s chief executive, Barry Arbuckle, says he is trying to create an “integrated health system” that operates efficiently and hits quality goals. Last year, MemorialCare said it would launch its own health plan focused on Medicaid recipients. He wants to craft deals with employers to care for their workers, and possibly offer individual plans.

Tracking doctors’ performance is “absolutely key” to this future, he says. Wide variation in practices among doctors is “extraordinarily costly,” he says. “Do we control physicians? We don’t try to,” he says. “We just try to use process and information to get them to that same point.”

MemorialCare’s efforts are two-pronged. One initiative focuses on what happens inside the hospitals. The other effort deals largely with outpatient care provided by affiliated physicians. The latter includes the program Dr. Baker oversees at MemorialCare Medical Group, the physician group.

Asked to devise ways to introduce the Crimson system to physicians who work in MemorialCare hospitals, several doctors created and starred in a video. One skit, “Dr. McClueless Gets Fired,” focuses on a doctor who ignores the Crimson data and loses his contract with an insurer. Meantime, “Dr. Goodjob” wins praise for trimming unnecessary daily X-rays and reducing some patients’ hospital stays.

Long stays and heavy use of services such as X-rays by inpatients can be costly to hospitals, which often aren’t paid more for the extra days or additional tests even under traditional reimbursement policies.

At MemorialCare’s flagship hospital, Long Beach Memorial Medical Center in Long Beach, Calif., Maged A. Tanios, an intensive-care specialist and a medical director whose job includes overseeing quality improvement, introduced Crimson in a meeting with doctors in 2011. For each physician, Crimson shows variables including complications, hospital readmissions and measures of cost. It uses yellow, green or red coloring to signal whether a doctor is performing about as well as peers, better or worse.

Gradually, Dr. Tanios and others cranked up the effort. Last spring, at regular meetings of the hospital’s medical staff, they began sharing lists of doctors whose patients spent on average the most days in the hospital, as well as those who spent the fewest. Doctors were encouraged to learn how to check their own data.

Some doctors had to go through “stages of acceptance,” he says. “First is anger, ‘Why is someone looking at my data?’ Then denial, ‘This is not my data!’ Then acceptance.” In the end, he has seen some doctors’ average patient stays go down after he discusses their results with them, he says.

MemorialCare says that, in general, the doctor-data efforts and other programs have helped reduce the average stay for adult patients to four days in 2012 from 4.2 days in 2011. MemorialCare also says that, between 2011 and 2012, it trimmed the average cost per admitted adult patient by $280, saving $13.8 million. It says it has improved on indicators of quality including patient readmissions, mortality and complications.

Mojtaba Sabahi, who practices at Long Beach Memorial, was warned by a pharmacist that data showed one member of his group of inpatient-care physicians was using Levaquin, an antibiotic, at a far higher rate than peers. MemorialCare guidelines generally recommend limiting use of the drug, largely on concerns about generating drug-resistant bacteria.

Dr. Sabahi says he shared the result with his colleague, and the doctor was receptive. MemorialCare says physicians are often willing to change if they believe they aren’t performing as well as peers.

Later, Dr. Sabahi checked the data and confirmed his colleague had cut back on the drug. “It completely changes the way we practice,” he says. While he says he himself appreciates the feedback, some physicians consider it “punitive” and think “the administration wants to make you practice their way.”

Dr. Baker oversees an initiative focused mostly on doctors who provide primary care. She got involved in quality improvement partly because of her work as a pediatrician, she says, which made her feel “very passionate about child vaccination.”

One day last fall, Dr. Baker sat down with about a dozen primary-care doctors in the group’s Irvine, Calif., clinic. She passed around a printout showing how each doctor, by name, was performing on 17 quality measures. The doctors’ performance looked “absolutely awesome,” she told them, with numbers generally in the top percentiles.

But on one measure, cervical-cancer screenings, the Irvine office’s results were falling short. The reason: Some patients were getting pap smears more often than every third year, as recommended by the California program.

Doctors said that some patients resist if told that they are low risk and don’t need annual exams. One doctor said she had hung a printout of cervical-cancer guidelines on the wall of an exam room to persuade patients they didn’t need annual paps. Also, some of the tests were being ordered by gynecologists outside the group who were also seen by MemorialCare patients.

One doctor, John Stasiewicz, raised a concern. Some diabetes patients needed closer care, but they avoid coming in for visits, limiting a doctor’s ability to track their progress. Then, if the patient’s blood sugar exceeds recommended levels, it counts as a strike against the physician in the data program. “It’s very frustrating,” he said.

Another doctor, Keith Lee, offered a solution. With some patients like this, he simply doesn’t give them long-term prescriptions, forcing them to come in for checkups and new prescriptions. “I cut them short, and then they get the message,” he said.

Generally, Dr. Baker says, doctors work to improve their results. As it ramped up its focus on the data efforts in recent years, the MemorialCare Medical Group has improved its performance on measures including giving people with asthma the right medications and adolescent immunizations, with data reported in 2012 showing 76% of patients getting recommended shots compared with 56% in 2010.

Still, she says, she runs into skepticism. That happened at a February meeting, where she introduced the program at a new MemorialCare clinic, located in a Long Beach, Calif, mini-mall.

With a half-dozen physicians gathered around a conference table, Dr. Baker showed a slide deck titled “Performance Improvement 101.” In addition to the measures of clinical quality, she said, the California program tracks indicators of efficiency, or “appropriate resource use.” Those include, among other things, prescribing of certain generic drugs and patients’ frequency of visits to the emergency room.

“Why do you care about pay-for-performance?” she asked the doctors.

She showed a slide listing some reasons. Among them: It can mean extra insurance payments. Doctors’ compensation is based partly on the results. And public reporting will mean their patients can see how well the medical group is doing.

And, “Of course, the most important thing is patient care,” she said. Despite the data targets, she also told the doctors that their clinical judgment would trump the recommendations.

Some doctors fired back tough comments. “I have a lot of reservations” about programs that tie payment to performance, said Dr. Warren, the cardiologist. He detailed his worry that the program could put pressure on doctors to avoid sicker patients in order to boost their numbers and pay.

Dr. Baker responded by saying that every doctor will have patients with difficult conditions who affect their results. “Your peers have the same issues you do,” she said. “These measures really do help us take better care of the patients.”

Dr. Warren wasn’t persuaded. Regardless of data-tracking and financial incentives, “I give very good care to my patients,” he said. “One-on-one, clinical care.”

The director of the clinic, David Kim, chimed in. “Well, you’re an outlier,” he said. “Every doctor says they provide good care to their patients,” but nationally, data show that patient outcomes are often bad. “I understand your reservations, and many doctors have those reservations,” he added.

Dr. Kim, for his part, had another concern: whether too much was being put on the backs of the doctors. “Physicians are going to feel that you’re whipping them to do more, and they’re going to burn out,” he worried.

Dr. Baker agreed there needed to be a “lot of collaborative effort” and said the group was working to improve its procedures and add more staffers. “All of this stuff needs to happen, and will happen,” she promised.

“You can’t piecemeal it,” Dr. Kim warned. “It can’t be a little bit here, a little bit there.”

As the doctors began to drift back to work, Dr. Baker thanked them. “My goal is to make a believer of Dr. Warren!” she said cheerfully.

Today, Dr. Warren says his February comments still represent “the way I continue to feel at this time.” But Dr. Kim says the data program has been well-received overall at the clinic. He said he recently hired a new staffer, with another planned, to help doctors with tasks including tracking when patients are due for tests.

Write to Anna Wilde Mathews at anna.mathews@wsj.com