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Health-care providers share a common goal: providing high quality care to their patients.
Measuring performance is important to how well the organization is accomplishing this goal. It
allows for an analysis of where and what changes need to be made in order to improve
performance and the quality of care provided. Measuring performance also allows providers to
understand what is working well; information that can be shared with other providers who can
learn from their success.

Performance measurement, therefore, is a set of technical specifications to assess whether the
correct processes are being performed and desired results are being achieved. The changing
nature of today's health care organizations, including pressure to reduce costs, improve the
quality of care and meet stringent guidelines, has forced health care professionals to re-examine
how they evaluate their performance.
A brief look at the evolution of quality in modern health care systems may help understand the
need to improve performance measurement.
More than 30 years ago, a physician named Avedis Donabedian proposed a model for assessing
health care quality based on structures, processes and outcomes.

Structural: Measures the organization’s capacity and the conditions in which care is
provided by looking at factors such as an organization’s staff, facilities, or health IT systems.
Example: Adoption of medication e-prescribing.

Process: Measures how services are provided, i.e., whether an activity proven to benefit
patients was performed, such as writing a prescription or administering a drug.
Example: Cervical Cancer Screening - The percentage of women who had a cervical cancer
screening with a Pap test.

Outcome: Measures the results of health care. This could include whether the patient’s
health improved or whether the patient was satisfied with the services received.
Example: Diabetes - Average hemoglobin A1c level for population of patients with diabetes.

To relate the newer system to Donabedian’s system, there are additional definition within the
process measures
Š Underuse
Refers to the extent to which necessary or indicated services are not provided. Examples include:
failure to prescribe beta blockers to patients after acute MI; failure to provide immunizations to
young children or flu shots to older adults; failure to provide regular screening mammograms to
women over 50; or failure to provide adequate doses of antidepressants to newly diagnosed

failure to follow up on abnormal test results. National and local accounting standards and the requirements of bond rating agencies typically provide a high level of standardization for these measures.. These measures are almost always expressed as rates. and are calculated after having first identified a target population of eligible patients or health plan members. Š Overuse Refers to the extent to which wasteful.depressed patients. Financial This domain of performance refers to familiar measures like net gain (or loss) or operating gain (or loss). Examples include: MRIs or x-rays for patients with new. Other performance measures like days in accounts receivable. Š Misuse Refers to the inappropriate use of procedures that would be beneficial if properly applied. or use of expensive patented medications when an equivalent generic is available. antibiotics for patients with viral infections. etc. elective surgical procedures for patients without clear indications. Most instances of “medical errors” fall in this category – overdose of medications. wrong-limb surgery. These measures reflect operating efficiency in financial terms. Other related measures include FTEs per occupied bed. or adverse drug interactions. uncomplicated low back pain. . or unproven tests and procedures are provided to patients who don’t need them. reflect the efficiency of financial management processes. days cash on hand. cost per adjusted discharge. ineffective. These measures reflect the most aggregated analysis of the balance between revenues and expenses.