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Health policy and research


3M clinical researchers and policy experts stay current with hundreds of regulatory and health care market-based initiatives, so you don’t have to. Here you can find resources, education and guidance on many Medicaid and other state initiatives that impact risk adjustment, payment redesign, outcomes-based incentives, health equity and more.

Research Series: Measuring Variation to Maximize Value

A new research series from 3M Clinical and Economic Research focuses on geographic variation in performance across measures of efficiency and outcome quality. Geographic variations are an indication that there are practice patterns and care processes in areas of the country that result in consistently better performance suggesting that real opportunities for performance improvement exist.

  • Medicaid expenditures comprise a large component of many state budgets and there is intense pressure on state Medicaid programs to find innovative ways to control health care expenditures. Many Medicaid programs have focused on payment reforms while excess health care expenditures can be the result of quality of care problems and delivery system ineffectiveness.

    Read the report (PDF, 483 KB).

  • The objective of the study is to identify patterns of performance differences that tend to consistently occur together within health care delivery systems across geographic areas. Using a cross-section of measures of delivery system performance, differences in actual performance (A) compared to risk-adjusted expected performance (E) were identified within each geographic area. Patterns of (A-E) performance differences across performance measures within geographic areas were identified using correlation analysis.

    Read the report (PDF, 599 KB).

  • This study proposes a restructuring of Medicare Hospital-Acquired Condition Reduction Program (HACRP) using a redesigned complication payment incentive model referred to as the Hospital Complication Avoidance Rate Evaluation or H-CARE. Developed based on lessons learned from the highly successful Medicare Inpatient Prospective Payment System (IPPS) and the Maryland Hospital Acquired Conditions (HMAC) complication payment incentive program, H-CARE can provide comprehensive, clinically credible, and actionable incentives for improving hospital inpatient complication.

    Read the report (PDF, 474 KB).

  • Extensive research has demonstrated that an individual’s socioeconomic status (SES) impacts the health care services they receive, health outcomes, patient satisfaction and physician perception of the care and treatment needed. This study evaluated the impact of SES on the performance of health care delivery systems using nine performance measures in four categories:

    • Population: per capita admissions, per capita emergency department visits
    • Post-Acute Care: readmissions, return emergency department visits
    • Quality: inpatient complications, surgical mortality
    • Service Volume: hospital admissions from the emergency department, admissions to a post-acute care facility, ambulatory visits

    Read the report (PDF, 608 KB).

  • Medicare payments to providers can vary significantly depending on the site where service is provided. A site-neutral payment policy would equalize payment for the same service irrespective of the site of service, potentially lowering Medicare expenditures. This report describes a method for identifying inpatient surgical cases that could reasonably be performed in an outpatient setting and a method for identifying equivalent outpatient surgical cases.

    Read the report (PDF, 846 KB).

  • This 3M Clinical and Economic Research report examines the extent of geographic variation in the rate of post-acute care (PAC) facility admissions for Medicare Fee-for-Service (FFS) beneficiaries and quantifies the financial impact of excess PAC facility admissions on Medicare expenditures.

    Read the report (PDF, 2.3 MB).

  • In this 3M Clinical and Economic Research report, the Potentially Preventable Emergency Department Visits (PPVs) methodology was used to identify emergency department visits that may be potentially preventable. If there are an excess number of PPVs compared to a national norm within a managed care plan or geographic region, it is likely the excess PPVs represent emergency department visits that could be avoided if the delivery system functioned effectively. Based on a risk-adjusted national norm, the analysis found considerable PPV performance variation across census regions, states and Core Based Statistical Areas (CBSAs) from the Office of Management and Budget.

    Read the report (PDF, 1.2 MB).

  • An evolution of the Medicare Inpatient Prospective Payment System (IPPS) to a hospital episode-of-care payment system would expand hospital responsibility to include the selection of the most appropriate care setting and the services delivered during the post-discharge period. This study identified seven measures of unnecessary or preventable quality or delivery system failures (EPMs) that are major drivers of hospital-related costs.

    Read the report (PDF, 365 KB).

  • Health care expenditures continue to steadily increase with hospital stays making up about one-third of health care expenditures. A well-functioning delivery system within a managed care plan or a geographic region should be able to minimize the need for hospitalizations. In this 3M Clinical and Economic Research report, the Potentially Preventable Admissions (PPAs) methodology was used to identify hospital admissions that may be potentially preventable. If there are an excess number of PPAs compared to a national norm within a managed care plan or geographic region, it is likely the excess PPAs represent hospital admissions that could be avoided if the delivery system functioned effectively.

    Read the report (PDF, 1.4 MB).

  • While there is increasing consensus that comparative mortality data should be included in hospital payment incentive systems, attempts to develop clinically credible and unbiased measure of mortality have proved challenging. The primary intent of mortality measurement is to provide hospitals the incentive and the information to improve mortality performance through quality improvement initiatives. To be effective for quality improvement, the measure of mortality should be limited to patients for whom a hospital is reasonably responsible for the patient outcome and thereby amenable to quality improvement efforts. A comprehensive method of measuring and comparing surgical mortality was developed for this report.

    Read the report (PDF, 920 KB).

  • This 3M Clinical and Economic Research report focuses on the four Quality Outcome Performance Measures (QOPMs) that relate to hospital inpatient care or care in the emergency department that directly impact the volume of inpatient admissions and bed days. The report examines the impact of inpatient quality outcome performance on the overall functioning of the inpatient delivery system for the Medicare population in each state.

    Read the report (PDF, 1.2 MB).

  • Early COVID-19 studies indicate that when older people contract the virus, they have a poorer prognosis, especially those 80 years or more and those with diabetes, chronic respiratory or cardiac diseases, immunosuppression or with multiple major comorbid chronic conditions. These COVID-19 risk factors were analyzed in conjunction with a comprehensive identification of patients with multiple high-severity comorbid chronic conditions to develop an operational definition of individuals with a high risk of a COVID-19 poor prognosis.

    Read the report (PDF, 885 KB).

  • This supplement to the report “The Financial Impact of Geographic Variation in Hospital Quality Performance in Medicare” examines the geographic variation in quality outcome performance measures (QOPMs) for specific disease and procedure categories. The description and details of the QOPMs, the methods of risk adjustment, determination of national and best practice norms, methods for computing expected values and methods of estimating the financial impact of QOPM performance differences are contained in the “Financial Impact of Geographic Variation in Hospital Quality Performance in Medicare.”

    Read the supplement to the report (PDF, 1.7 MB).

  • In a major new research study from 3M Clinical and Economic Research, 3M healthcare policy experts evaluate variation in inpatient and outpatient quality performance across geographic regions and simulate hospital payment system reforms based on hospital quality performance. Using clinically credible quality measures, the study quantifies the financial impact of quality performance in terms of the relative impact on Medicare payments. The overall objective of the study is to provide regulators, payers, and hospital-based organizations with meaningful and actionable information that can promote quality improvement efforts.

    Read the report (PDF, 977 KB).

  • The primary objective for the 3M CER report is to determine whether there are substantive differences in the care delivered to duals and non-dual Medicare beneficiaries based on measures of quality and delivery system effectiveness.

    Read the report (PDF, 501 KB).

Policy in action

  • Outline of Texas
    Texas hospital averages $30M in gains per year through state incentive program

    Oscar A. Perez Jr., program manager at University Medical Center of El Paso (UMC) discusses strategies employed by UMC to reduce potentially preventable readmissions, successfully meet quality-outcomes benchmarks and attain financial incentives under DSRIP.

    Read the article.

  • Outline of Hawaii
    Hawaii: 3M APR DRG implementation announced

    Beginning with admission dates on July 1, 2022, inpatient acute services for the Hawaii Medicaid program shall be paid using 3M All Patient Refined Diagnosis Related Groups (APR DRGs). Due to APR DRGs’ enhanced granularity (particularly for key Medicaid service lines) and widespread adoption of across states, Med-QUEST (MQD) will use the APR DRG grouper as the patient classification system for its new Medicaid inpatient prospective payment methodology.

    View the posted fee schedules and click on the APR DRG Payment Methodology tab to learn more: Fee Schedules (

    Publication Date: July 2021

    Download the memorandum (PDF, 427 KB).

  • Outline of Idaho
    Idaho: Moving to 3M APR DRGs for inpatient reimbursement

    The Idaho Department of Health and Welfare (DHW) intends to implement 3M™ All Patient Refined DRG (APR DRG) as the payment method for inpatient hospitals stays for the Medicaid program on July 1, 2021. The 3M APR DRG methodology classifies hospital inpatient stays according to the reason for admission, severity of illness and risk of mortality. By using 3M APR DRG Idaho DHW will have a better understanding of the clinical complexity of the patient population to base accurate value-based reimbursement. Medicaid agencies, commercial payers and Medicaid managed care organizations nationwide use 3M APR DRGs for risk adjustment, claims payment and as the basis for hospital quality measurement.

    More information is located on the DHW website.

    Publication Date: May 2021

  • Outline of Texas
    Texas biannual report on initiatives to reduce avoidable emergency room use and improve outcomes in Medicaid

    This biannual report from Texas Health and Human Services describes the agency’s efforts to reduce potentially preventable emergency department utilization by Medicaid recipients and current and proposed initiatives to improve Medicaid recipients’ health outcomes. 

    Published by Texas Health and Human Services Commission, March 2022

    Read the report (PDF, 1377 KB).

Resources for health policy and research

Want to know more? Check out what our clients and 3M experts have to say about health policy and research.

  • A mother in a hospital gown kissing her newborn's forehead.

    How accurately capturing social determinants of health can positively impact health outcomes

    In the U.S., social determinants of health (SDoH) have increased pressure on policymakers, hospitals, providers and communities to improve population health and promote equitable health outcomes. While much attention is being paid to the inpatient setting, there is a tremendous gap in the outpatient setting. This article reviews the current situation and suggests ways to address the problems.

    Read the article (PDF, 61.5 KB).

  • Yichen Zhang and Dawn Weimar

    Practical guidance for assessing equity and the impact of social determinants on health outcomes

    This interview with Yichen Zhang, PhD, lead research economist at 3M Health Information Systems, gives her perspective on the strategic planning process to both address outcomes and focus on improving equity. Dr. Zhang also explains the principles of research design using claims and encounter data augmented with social determinants variables that may be available to many state Medicaid organizations. 

    Read the interview (PDF, 111 KB).

  • 3M Medicaid Video � Descriptive Transcript Video opens with 3M Science Applied to life logo (DESCRIBED VIDEO) Animated video. Animation of 3M Science Applied to life logo appears and fades out. (NARRATOR) As state Medicaid agencies and health departments, you have a challenging job. And those challenges have been compounded in recent years with a global pandemic and changing payment models. (DESCRIBED VIDEO) We see a woman standing at the head of a conference room table leading a discussion with four other people. Video fades to shot of the US Capitol rotunda illuminated from the inside. (NARRATOR) From understanding the impact of pre-natal, maternal and infant health, to knowing how behavioral health impacts physical well-being. And incorporating social determinants of health while ensuring sufficient access to services and health equity. Your challenges are immense. (DESCRIBED VIDEO) We see the foot of a newborn in a NICU incubator, a woman selecting a product from a grocery store shelf, a female doctor consulting with an older female patient, and a man engaged in an online meeting with four other people. (NARRATOR) And oh, by the way, you have to meet these challenges in a financially responsible way. (DESCRIBED VIDEO) Video transitions to a closeup of a stethoscope on a desktop with a doctor working at a computer in the background. (NARRATOR) 3M can help. We have the tools that can help you simplify health care by focusing on the unique conditions of individual patients. And tailor policies to achieve your goals and monitor progress toward success. (DESCRIBED VIDEO) Animation of charts and graphs appears in the background as product names appear on screen: 3M Clinical Risk Groups, 3M All Patient Refined DRGs, 3M Enhanced Ambulatory Patient Groups and 3M potentially Preventable Events. Additional text appears over a new graph: Understand individual Health Status; Find variation in utilization, cost patterns and care inequities; Drive improved provider performance. (NARRATOR) We offer a patient-centered risk adjustment tool to help you compare beneficiaries with similar clinical conditions so you can better understand their individual health burden. (DESCRIBED VIDEO) We see a young, black girl having her finger pricked by a doctor for a blood sugar test as her father looks on. (NARRATOR) This understanding is the basis for comparing treatments and outcomes of similar individuals to see differences in utilization and cost patterns. You can also identify gaps in care and how to avoid emergency department visits and hospital admissions. (DESCRIBED VIDEO) Video transitions to a conference room where people are reviewing a variety of reports and other documents. We then see an ambulance pulling into the emergency entrance of a hospital. (NARRATOR) Our tool provides you with a better understanding of areas where access to care is driving costs. You can deep dive into socio-clinical risk and understand where and when inequity happens. And what causes those inequities. From there, you can tailor solutions for your state with the resources you already have. (DESCRIBED VIDEO) We see a home health nurse approaching the front door of a home for a visit. We then see a family blowing bubbles and enjoying time together outside. The video then transitions to a closeup of an IV bag with a heart monitor in the background. (NARRATOR) Let�s talk about variation. We know variation happens when it represents a variation in needs. Different severity of illness can drive different needs. (DESCRIBED VIDEO) We see a wide shot of a crowd of people in a downtown area. We then see a young health aide encouraging an elderly gentleman using a walker in a hospital corridor. (NARRATOR) But we should not see wide swings in variation of care for clinically similar patients. Two different individuals with similar conditions should have very similar access to care, treatment patterns and outcomes. (DESCRIBED VIDEO) We see another shot of the young, black girl on her father�s lap having her blood pressure checked. Video transitions to show another young girl hooked to an IV in a hospital bed. (NARRATOR) 3M can help you identify individuals with unique clinical conditions, adjusted with the severity of those health conditions and social risk. Then we can compare individuals and groups to identify both excellence in care and areas of deficiencies. (DESCRIBED VIDEO) We see a closeup of hands working at a computer keyboard, another shot of an online meeting in progress, and then a closeup of workers� hands at computers creating charts and graphs for comparison. (NARRATOR) When you identify variation, you can find answers to difficult questions like: How do patterns of care differ? Do patients with those conditions have superior outcomes in an outpatient or an office setting? Is the difference strongly influenced based on geography, race, ethnicity or gender? If so, are there barriers causing poor access and do these cause different patterns of care? (DESCRIBED VIDEO) We see a female doctor having a discussion with a man in a business suit, another shot of a different doctor using a report to discuss findings with a colleague, an Asian mother and daughter taking a selfie, and finally a closeup of patient data on a laptop. (NARRATOR) One thing we do know is that health care is highly personal. Each person is unique and should be treated like an individual. Using person-level, risk-adjusted data can greatly enhance your ability to recognize opportunities to improve quality. (DESCRIBED VIDEO) We cut to a closeup of an African American woman�s face, parents giving their young children rides in empty boxes across the living room floor, a woman holding on to a grab handle in a subway car, and video of a group in a conference room having an online meeting with others appearing on a video screen on the wall. (NARRATOR) And quality is a key contributor to creating and refining value-based payment strategies. (DESCRIBED VIDEO) We see a closeup of a monitor tracking vital signs in a hospital room. (NARRATOR) You can identify root causes of health inequity and develop policies to improve. (DESCRIBED VIDEO) We see a young, black boy holding the hand of an adult as they walk in a park. (NARRATOR) With 3M�s unique background and more than 35 years of expertise, we can partner with you to ensure that your state not only meets budget and quality initiatives, but more importantly, enhances the lives of the people you serve. (DESCRIBED VIDEO) We see a group of employees in a conference room discussing reports. Then a closeup of a tablet screen with results from states using 3M products. We close on closeup of the same young, black girl we have seen before having her ears checked by her doctor. Animation of 3M Science Applied to life logo appears and fades out.

    A person holding a tablet showing methodology data for six states

    Video: Identifying variation to find opportunities in Medicaid

    State Medicaid agencies and health departments have a challenging job compounded in recent years with a global pandemic and changing payment models. With 3M’s unique background and more than 35 years of expertise, we can partner with you to ensure that your state not only meets budget and quality initiatives, but more importantly, enhances the lives of the people you serve.

  • Close-up of peoples' hands pointing at a report print-out

    Medicaid hospital payment policy to improve value through directed payments: A proposed strategy

    This paper proposes a strategy for Medicaid agencies to simultaneously maintain the flow of federal funding to states and hospitals, improve patient outcomes, increase transparency, reward efficiency, and promote access to care.

    Read the report (PDF, 334 KB).

  • Medical professionals transporting a patient on a gurney

    The need to incorporate the present on admission (POA) indicator in claims-based mortality measure

    Mortality measures are intended to provide quality guidance for consumers and contribute to overall value-based purchasing (VBP) incentives for hospitals. In our study we look at the effect of the failure of the CMS mortality model to account for the effect on hospital performance rankings of variations in Do Not Resuscitate (DNR) orders and major comorbidities present at the time of admission (POA).

    Read the report (PDF, 380 KB).

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