The Michigan Value Collaborative

Helping Michigan hospitals achieve their best possible patient outcomes at the lowest reasonable cost

Month: March 2016

MVC is different: How we compare to the other Blue Cross-funded CQIs

Andrea McVeigh is the Project Manager of MVC.

As the Project Manager of the Michigan Value Collaborative (MVC), one of my favorite things is on-boarding a new hospital, site coordinator or champion, and getting to know each of them. One of the most common questions I hear during this process is, “How does MVC compare to the other Blue Cross Blue Shield Michigan (BCBSM)-funded Collaborative Quality Initiatives (CQIs)?” If this isn’t asked early on, I make sure to point out the similarities and differences, because it’s important to understand how MVC fits into the Value Partnerships program at Blue Cross. In this article, I’ll first describe the differences and then the similarities between MVC and the other Blue Cross-funded CQIs.

How is MVC different from the other BCBSM-funded CQIs?

  1. MVC focuses on improving and optimizing cost-efficiency and care transitions around episodes of hospitalizations. To date, we are the only CQI that includes cost data.
  2. MVC examines a wide array of clinical conditions: We examine 25+ clinical service lines, ranging from medical conditions (like congestive heart failure and pneumonia) to surgical procedures (like heart valve replacement surgery or total hip replacement surgery). The other Blue Cross-funded CQIs are centered on a specific clinical condition.
  3. MVC uses pre-existing claims data to inform and initiate change: We use claims data to define our episodes of care. Other CQIs collect their own data from patient records. In MVC, the data are already collected and we require no chart abstraction.
  4. MVC engages hospital executives and leaders, in addition to clinicians: Other Blue Cross-funded CQIs engage mostly with clinicians. Their meetings are attended mostly by doctors, physician assistants and nurses. Because of the nature of our data and the fact that they include cost and utilization information, our meetings are attended mostly by Chief Medical Officers, Chief Executive Officers, Chief Financial officers and Directors of Quality.  

How is MVC similar to the other BCBSM-funded CQIs?

The CQIs have an obvious similarity, which is that we are all funded by BCBSM and are part of their Value Partnerships program.   But other than our funding source, what else makes us similar to each other? Well, there’s an intangible quality that we all possess, a certain “je ne sais quoi”. For the last ten years, I have been working solely on Blue Cross-funded CQIs. So I guess you could say I’ve been around for a little while. What I’ve learned in the last decade is that the Blue Cross CQIs are alike because we all possess the essential ingredients necessary for running successful statewide collaborative quality initiatives.  

  1. Our sponsor and partner, Blue Cross Blue Shield of Michigan: The support the Blues provide is exceptional. Their financial support is what makes all of this possible and without it, none of the CQIs would exist. Their support is so much more than financial, though. Their partnership, constant engagement and innovative vision keep us all humming along and pointed in the right direction. Our leader at Blue Cross, Dr. David Share (who serves as Sr. VP of Value Partnerships) was named by Crain’s Detroit Business as a Health Care Hero for the work he has done to transform Michigan’s health care system. Blue Cross’s Value Partnerships Program has won numerous national awards for their cost-savings and improvements to patient care ( Since we live in Michigan, it’s easy to forget that for the rest of the country, this is not the norm. Other states don’t have payers who are as devoted to developing and continuously supporting statewide collaborative work as Blue Cross of Michigan is.  
  2. Engaged hospitals across the state. When you stop and think about what the CQIs ask of hospitals, it’s quite astounding. We more or less ask Michigan hospitals to look at data we provide them, ask themselves why they’re performing above or below the state average and, if they’re willing, open up their doors and share their best practices with their competitors. It’s this collaboration that drives improvement. Without the buy-in, participation and continued engagement from hospitals, any CQI surely would fail.
  3. Unbelievably talented Directors of the CQIs: Each of the Blue Cross-funded CQIs has a Director who, along with the rest of the Coordinating Center, leads the charge and manages the project. The type of talent to which I’m referring is more than just the necessary brainpower and discipline to get the job done; it’s the ability to earn the trust and respect of all of the hospitals across the state.

And there you have it: a quick run-down of how MVC compares to the other Blue-Cross funded CQIs. Even though MVC uses claims data and cuts across multiple specialties, we still need the same 3 essential ingredients to thrive.

Questions or comments?  We’d love to hear from you.  You can comment on this article, or use the form at the bottom of this page.

3 ways that MVC’s risk-adjustment model differs from the Medicare model

Brooke Kenney

Brooke Kenney is a data analyst working with MVC

Chad Ellimoottil

Chad Ellimoottil is a Postdoctoral Fellow working with MVC.

“Why does the MVC risk-adjustment model differ from the one that Medicare uses?” This is a question that we have heard multiple times from hospitals. To address this question, we embarked on a series of analyses quite like peeling back the layers of an onion. The highlights of our journey are detailed below. In the end, we found three areas of discordance and we even made some changes to our model to make it better.

But first, what is risk-adjustment? Hospitals treat a variety of patients whose cost may be influenced by the severity of their physical condition. Since many healthcare programs link quality of care to cost, it is necessary to account for serving costly patients in a fair, standardized manner. Risk-adjustment (RA), therefore, is a statistical method that helps “level the playing field” by accounting for differences in case-mix.

Difference #1

The Cohort: We compared the risk adjustment model used by MVC and CMS for two conditions; AMI and Joint Replacement. The key differences in the cohorts are that MVC includes statewide BCBSM and Medicare patients, resulting in a younger population. The CMS cohort contains nationwide patients age 65 or older and applies several exclusions to patients with: HMO insurance, less than 12 months of enrollment data, specific discharge disposition categories, and others. When the observed episode costs of the MVC cohort were run through the CMS model, and vice versa, there was minimal impact on hospital ranking for total episode cost.

Difference #2

The Statistical Model: As it turns out, the patients we serve in the great state of Michigan are variable and complex. They require a regression analysis to explore the relationship between patient demographics and comorbidities on cost. In addition, there are a number of regression techniques developed to study a particular cohort. Perhaps the different models employed in our two RA methods are contributing to total episode cost differences? MVC uses a 2-step linear regression model with Poisson distribution to calculate an observed to expected ratio for each hospital. This ratio is multiplied by the state mean expected cost to produce a risk-adjusted mean cost for each hospital. CMS uses a random-effects model to calculate a predicted to expected ratio for each hospital. This ratio is multiplied by the national mean cost to estimate the risk-adjusted mean cost for each hospital.  To test for differences, we calculated the correlation of hospital ranking by holding the independent variables constant (first with MVC variables and next with CMS variables) and applied them to the two models. There was a strong correlation between the MVC and CMS hospitals, leading us to conclude that the model differences do not matter much.

Difference #3

The Comorbidities:  With a couple key layers removed from our onion, the investigation of cost differences has been narrowed down to the independent variables. This required a performance evaluation on the two types of comorbidity definitions; Elixhauser (MVC method) and Condition Category (CMS method). For example, does one method capture more comorbidities in the data than another? Does this capture noticeably impact the adjusted cost? In our effort to determine a preferred method, we found that CCs captured more ICD9 codes than Elixhauser by sheer volume of co-morbid categories, 180 to 29, respectively. After our comparisons of the MVC and CMS risk-adjustment models we found that CCs outperformed models with Elixhauser and we will be changing to Condition Categories to define comorbidities.


Based on these analyses, we will be incorporating multiple new changes to the risk adjustment model:

  • We will start using Condition Categories instead of Elixhauser categories
  • We will use a 6-month look back in the claims data from the time of the index-admission to identify comorbidities as well as the “present on admission” indicator to ensure that we are capturing comorbidities in the robust manner possible
  • We will also add professional claims to this loopback period in addition to the facility claims.

These risk-adjustment changes have occurred as of Feb 8th, 2016!  We call these changes “Update 1”. We are working on “Update 2”, which includes an analysis of our condition-specific risk-adjusters.

Last but certainly not least, we value feedback from our MVC participants on how we can customize our models to better define the patients we serve throughout the state. In fact, a team within the Coordinating Center is currently conducting site visits at all hospitals just to hear from you. We look forward to what 2016 has in store for MVC.