There are many reasons why healthcare performance measurements are important to healthcare institutions and society in general:

Good health is more important to people than most other goods or services ¹. Society has a strong collective interest in assuring that the healthcare system works to ensure people lead healthy lives as much as possible.

Governments and individuals spend a lot on healthcare. Not only do people collectively and individually spend significant dollars on healthcare (and/or healthcare insurance), these costs have risen quickly over time compared to other economy sectors.

People want to make informed decisions about their healthcare. Objective performance measures help people make better healthcare decisions because they can compare “apples to apples” and seek the best care.

Governmental bodies can make better healthcare polices. Performance measurements provide solid background data for legislative policy discussions about healthcare programs and investments — indicating where improvements in laws and mandates can be made.

Performance measurements provide one of the best ways to spearhead overall health system and hospital improvements by providing solid data on the current state of efficiencies and effectiveness, including:

• Evaluating and measuring that a facility or individual meets established benchmarks
• Identifying gaps in care — especially where performance is low, and remediation is needed
• Recognizing and rewarding above-standard performance — and using these examples to create best practices
• Securing ongoing data to monitor information about changes in quality of care over time

In 2009, the US government created a USD 27 billion incentive program to encourage healthcare providers to adopt EHRs. One of the reasons for the changeover was to give hospitals reliable data for healthcare performance measurements — ultimately increasing efficiency and quality of patient care.

Though EHR acceptance has continued, led by an upsurge in the adoption of cloud-based EHR software, the results have been mixed. According to a Stanford/Harris Poll study ², 40 percent of primary care physicians believe that there are more EHR challenges than benefits.

In response, software providers have developed advanced healthcare software platforms, which can streamline the EHR process and provide tools to more easily track patient outcomes and patient satisfaction. Using the tools, healthcare institutions can access patient care data that is easy to analyze and act on.

Prioritizing healthcare performance measurements – which are more important?

There are hundreds of healthcare performance measures that a healthcare institution can track. How does an institution decide which measures are the most important?

Alanna Moriarty from Definitive Healthcare points out in her blog ³ that the CMS continues to add and modify quality programs, making it difficult for institutions to prioritize metrics. She suggests ten essential healthcare performance measures:

Length of stay
Measures the length of time between a patient’s admittance and discharge. This metric gives an institution hard data over time on care efficiency.

Readmission rates
Tracks the percentage of patients that are re-admitted within 30 days of their discharge. Hospitals are able to quantify the quality of care patients received. A large percentage of readmissions may mean that patients are receiving substandard care and providers are overlooking complications or relevant patient data.

HCAHPS – patient satisfaction
The Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey provides an extensive measurement of patient satisfaction — from care quality to facility cleanliness.

Mortality rates
How many patients die during a hospital stay before being discharged? This measurement indicates how well an institution can stabilize a patient's condition following surgery or another procedure.

Bed utilization rate (or bed occupation rate)
Measures how many hospital beds are being used at any given time. If there are too many hospital beds available, a hospital many lose money because staffing and maintenance costs remain relatively constant — no matter the number of patients.

Hospital incidents
Measures the consequences from unexpected side effects of hospital procedures. The metric is an important indicator of whether a hospital has the procedures in place to give high-quality care without triggering an incident.

CMS program performance initiatives
The CMS has many performance measurement programs designed to reduce costs and improve patient care.  Examples include the Medicare Shared Saving Program, Bundled Payments for Care Improvement (BPCI) program and Fee-For-Service Part B.

Average cost per discharge
Helps hospitals understand where there may be overspending and where they can make the most profit. Hospitals gain useful data, so they can better analyze which patient care costs best improved patient outcomes.

Operating margin
Gauges the institution’s revenues after subtracting all operating costs — though typically, most hospitals do not have a positive margin. If a facility cannot maintain close to break even or better, the ability to enlist staff and provide quality patient services may suffer.

Bad debt
Bad debt is revenue not received — all or in part — for patient care. However, lack of payment is only considered bad debt if there has been an event in a patient's life, such as unemployment, that keeps them from paying for care.