Episodes of Care

The concept of episodes of care emanates from efforts by payers and providers to better understand and control resource allocation and costs in the delivery of health care services. A number of approaches have been designed over the years to describe the delivery of health services, such as the use of ICD-9 and CPT-4 codes, diagnosis-related groups (DRGs), and resource-based relative value scales, but these approaches often are inadequate to account for the variation in the care of a particular patient treated by a particular physician during a defined time period for a particular disease. Health care analysts find these methods of analysis prove useful in certain applications but fail to provide information about specific “best practices” for [Page 189]determining the quality and cost of care for a clinical condition. Episodes of care are designed to provide a comprehensive structure within which the value of health care (that is, the cost and quality) can be examined.

For any disease, specific time periods in the course of the disease can be classified according to some criteria, for example, a known complication such as diabetic ketoacidosis; a particular period of an illness such as the febrile period of streptococcal pharyngitis; a lab value, such as a low sodium value during an episode of hyponatremic dehydration; or any of several other criteria related to the disease or treatment. For example, a managed care organization may want to define an episode of care by some financial issues rather than by clinical conditions. A hospital may want to focus on procedures as the basis for defining an episode of care. The key to effectively using the “episodes of care” concept is to involve experts in designing the measurement system used to define the episode, using a clinical framework appropriate for the clinical condition and the environment of care.

Episodes of care provide a useful way of evaluating patterns of care. For example, O'Reilly evaluated nursing practice and hospital resource allocation for the perioperative period in patients undergoing total abdominal hysterectomy (O'Reilly, 2001), in which the definition of an episode of care helped define the boundaries of care so that best practices and resource allocation could be analyzed. Another example of effectively using the episodes-of-care concept was published by Pine (2001), who risk-stratified 100,000 episodes of care for nonsurgical coronary revascularization to evaluate quality and cost. The information gleaned from that study can help payers determine the value of specific procedures performed by providers. Evaluation of episodes of care can then be analyzed among providers to determine those who produce the greatest value in terms of quality and cost.

Episodes of care have been evaluated in a number of ways. For example, an inpatient hospital stay may be the defined episode of care, and the patient record may be the source of quality data, whereas the administrative data may be contained in the bill generated by the hospital at the time of patient discharge. These episodes may be grouped by procedure or diagnosis code, or by particular resource use patterns, or some other parameter of interest. However, the creation of an episode of care starts with the first service or patient encounter and ends when the patient's clinical condition has resolved or transition to another care environment has occurred. For example, systems of analysis that use administrative (health care claims) data, these starting and ending points may be easily identified by dates or places of service codes. Another method of analysis that has been created uses a model termed Episode Treatment Groups™ or ETGs, developed by Symmetry Health Data Systems Inc. in Arizona (http://www.symmetry-health.com). ETGs have been formulated to be similar to DRGs, in that each ETG belongs to a major practice category (MPC), just as each DRG belongs to a single major diagnostic category (MDC) defined by body system. Each MPC represents a body system and/or a particular physician specialty, such as endocrinology or urology or infectious diseases. ETGs have some unique characteristics that differentiate them from

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