ECR® Playbook

1. An ECR® is a global payment for an entire episode of medical care for a particular payer-provider-patient triad, as informed by clinical practice guidelines and/or expert opinion.
2. The ECR® starts after a confirmed trigger for that episode (e.g. a diagnosis) – although the ECR® can then be paid prospectively as a global fee. In no event does an ECR® impute event/probability risk to the provider.
3. ECRs® are developed based on the quantity and types of services needed for the treatment of a typical episode of care, meaning that the episode excludes services provided for conditions and procedures not related to the index condition, as well as those for potentially avoidable complications/errors. This defines the boundaries of expected variation within a typical ECR®.
4. The base quantity of different types of services within an ECR® is adjusted to account for regional variations in practice patterns.
5. ECRs® are severity adjusted based on the factors outlined below, which creates clear delineations for risk corridors for the episode within the normal boundaries of total expected variation
   1. patient characteristics
      1. demographics
      2. comorbid conditions
      3. severity of illness
      4. evidence-informed procedures performed
      5. evidence-informed pharmacy used
   2. provider characteristics
      1. hospital location – rural vs. urban
      2. hospital type – teaching vs. non-teaching
      3. hospital size – number of beds, specializations
      4. physician specialty type – primary care vs. specialist
   3. geographic factors
6. A stop-loss creates an upper boundary for the expected variation in any ECR® and insulates providers from any costs above the stop-loss.
7. Care for potentially avoidable complications is accommodated and paid for through an allowance that is calculated based on a percentage of the current costs of potentially avoidable complications. This creates a clear and unambiguous incentive for providers to reduce those complications. The allowance is allocated pro rata to each ECR®, taking into account the severity of the patient treated.
8. A margin is built into each ECR® reflecting the importance for any going concern to have a return on capital assets invested and a reason to reinvest in business operations.
9. Each ECR® is scored and the scores across ECRs® are summed for each provider into an overall provider-specific scorecard that informs the providers on the relative effectiveness and efficiency of the services they have delivered, as well as the public on the differences among providers.
10. With 70% of the provider’s total score based on what they do and 30% based on what providers that are downstream from them do, a bonus potential is built into the program for attaining high quality scores which take into account performance ratings:
    1. process measures
    2. outcomes measures
    3. using enhanced practice infrastructure - CPOE, EMR, on-line scheduling
    4. patient experience surveys
    5. coordination of care through nurse support, reminder program