Golden trophy on dark base

A friend wrote that his request for a procedure was being denied by the insurance company because the hospital in question is not considered a “Center of Excellence” for this particular specialty. What does that mean? What is a “Center of Excellence,” anyway?

I’m not identifying the friend or the hospital, except to say that the hospital in question has an outsize reputation as the hospital of choice for many conditions and procedures in its city. It is an academic center with multiple awards and a world-renowned staff. A hospital across town, generally of lesser reputation and stature, is in fact a “Center of Excellence.”

So, I asked him, why is it not a “Center of Excellence”? What are the criteria, and how can it become a “Center of Excellence,” approved to do the procedure?

It turns out, of course, that in some cases the insurer grants “Center of Excellence” status, making it dependent on accepting the insurer’s payments. In some cases, it’s a third party that grants the status. In any case, it seems to be true that the designation “Center of Excellence” can mean different things.

What is a ‘Center of Excellence’?

Of course, we would all prefer to have surgery done at a Center of Excellence. But what is that?

Wikipedia says: “A center of excellence (COE or CoE), also called excellence center, is a team, a shared facility or an entity that provides leadership, best practices, research, support or training for a focus area. Due to its broad usage and vague legal precedent, a ‘center of excellence’ in one context may have completely different characteristics from another. The focus area might be a technology (e.g. Java), a business concept (e.g. BPM), a skill (e.g. negotiation) or a broad area of study (e.g. women’s health).”

The National Library of Medicine writes: “Centers of excellence — specialized programs within healthcare institutions which supply exceptionally high concentrations of expertise and related resources centered on particular medical areas and delivered in a comprehensive, interdisciplinary fashion — afford many advantages for healthcare providers and the populations they serve. To achieve full value from centers of excellence, proper assembly is an absolute necessity, but guidance is somewhat limited. This effectively forces healthcare providers to pursue establishment largely via trial-and-error, diminishing opportunities for success.”

Altarum, at its “Healthcare Value Hub,” writes: “Ample evidence demonstrates widespread variation in treatment approaches, costs and quality when it comes to treating patients with moderate to complex conditions. … Centers of Excellence (COE) have been deployed as a strategy to address the patient harm that arises from this unwarranted variation, such unnecessary spending, inadequate clinical outcomes and poor patient satisfaction.  

“COEs are designated groups of providers that meet high standards for both the quality and the cost of care for a particular service or set of services. Common examples are non-emergent and complex specialty services, such as total joint replacement, heart surgeries, spine surgeries, bariatric surgeries, cancer and transplants. … The evidence for these programs is mixed but COEs can potentially help address a number of health system problems.”

Who decides what’s excellent?

It all sounds great, but what makes a Center of Excellence? Who grants the designation?

Altarum writes: “Walmart employees who thought they needed spine surgery were encouraged to visit a Center of Excellence, which includes Rochester, Minn.-based Mayo Clinic and Danville, Pa.-based Geisinger Medical Center. Between 2015 and 2018, more than half (54 percent) of Walmart employees who were seeking treatment for spine pain avoided surgery because they visited a Center of Excellence. Choosing a Walmart-recommended hospital also resulted in shorter hospital stays, lower readmission rates and few postsurgical care needs. … While Walmart reported spending $32,177 per patient for spine surgery, a higher charge than that at non-Centers of Excellence, the company said it saved money overall because of surgeries that were avoided and better outcomes.”

But wait!

“In 2006, the Centers for Medicare & Medicaid Services ruled that Medicare would pay for bariatric surgery only if it was performed at an American Society for Metabolic and Bariatric Surgery (ASMBS) Center of Excellence or an American College of Surgeons (ACS) level 1 bariatric surgery center. However, research suggests that outcomes for patients who undergo bariatric surgery are no better at facilities that perform a larger number of these procedures or that are designated as Centers of Excellence. After examining this study and many others, a Medicare review group concluded that the COE designation does not provide improved outcomes for Medicare beneficiaries. Because of this, Medicare removed the requirement that bariatric surgery be performed only in COEs.”

What you have probably noticed is that none of these specifically say who makes the Center of Excellence designation. As it turns out, the designation can come from many places.

Optum, a subsidiary of the UnitedHealth Group, decides what’s excellent and what isn’t.

“How do we evaluate excellence? Optum’s Clinical Sciences Institute, a group of more than 100 practicing clinical experts, helps develop our evaluation criteria. Only those programs deemed to be clinically superior through our evaluation process are considered for a Centers of Excellence network,” Optum says. It uses various criteria, it says: Procedure success and survival rates, quality of medical professionals, number of patients treated with a specific condition and so on.

Also: “Participating Centers of Excellence programs must be willing to meet Optum’s contracting terms. Rates need to provide economic value to Optum’s clients and be competitive with other network medical centers.”

In other words, if you’re excellent but Optum wants to pay you less, you’re out.

‘Subjective (and ambiguous)’

Ron E. Peck, chief legal officer for the Phia Group, a healthcare law advisory firm in Canton, Mass., wrote in an email: “Centers of Excellence is a subjective (and ambiguous) term.  In the examples you provide, it’s a formal term used to describe what amounts to another network. 

“Like you, I am also dubious when a prerequisite for the title has to do with agreeing to contractual and financial terms.  Elsewhere, ‘Centers of Excellence’ can mean providers that have been vetted by a payer and deemed to offer the best outcomes for the lowest cost.  In instances where the provider doesn’t have to agree to anything, and the designation is based solely on the provider’s performance, it’s a more valuable term.  At least to me!”

Another expert, Sabrina Corlette, research professor at the Center on Health Insurance Reforms at Georgetown University, wrote in an email in response to a question from me:

“Centers of Excellence have been around a long time, and as cost-containment efforts go, seem fairly benign to me, although I could see how the concept could be abused. It is true that there is no one national standard for what it means to be a COE. 

“(FWIW, I worked with the Bipartisan Policy Center last year on a report that included a recommendation for exactly that: )”

The report suggests that Congress should require the Department of Health and Human Services to designate such centers.

Another thing we are not clear about: Is there a fee for this “Center of Excellence” determination? There are no obvious sources for information on this.

We have heard of various certifications in the healthcare industry where a validation or certification costs money. There are also credentialing conflicts throughout healthcare: For walk-in or urgent care centers, there are many credentialing opportunities — the National Urgent Care Center Association, the National Urgent Care Association, the Joint Commission, the Accreditation Association for Ambulatory Health Care and the Urgent Care Association, to name a few.

Meanwhile, my friend said in a phone conversation recently: “My suspicion is that it is a political business decision.

“When it first emerged as an issue, I very naively thought that there was one centralized third party that would award this — and that it would be evidence-based medicine, based on outcomes and treatment efficacy. That was a stupid assumption on my part. 

“When I saw that it was in the control of [the insurance company] it became clear that they would say essentially they would deign to grant you this so we will pay.”

Other accreditations

Here are some other examples:

“University of Utah Health today announced that the Craig H. Neilsen Rehabilitation Hospital has been named a Center of Excellence in Rehabilitation Services by the Center for Improvement in Healthcare Quality (CIHQ),” University of Utah health reported.

“HCA Florida Woodmont Hospital has recently achieved accreditation as a Center of Excellence in Robotic Surgery, recognized for providing the highest quality of care and patient safety by Surgical Review Corporation (SRC),” HCA Healthcare reported.

The Cleveland Clinic seems to be declaring itself a Center of Excellence, but some accreditations come from outside. “A critical first step in the center of excellence programs is the medical record review conducted by an expert Cleveland Clinic surgeon. In some cases, this review results in altering the original treatment plan and patients can avoid surgical procedures altogether. This benefits not only the patient but results in cost savings for employers. … As part of the health system’s Bariatric and Metabolic Institute, an American College of Surgeons Metabolic and Bariatric Surgery Accredited Quality Program, the new Bariatric Center of Excellence physicians review a participant’s medical history and diagnosis before determining the correct course of treatment. “

“Norton Healthcare has been named the first Advanced Orthopedic & Spine Center of Excellence in the country by the national accrediting body DNV,” a Louisville, Ky., TV station reported. DNV seems to be DNV Healthcare; on its LinkedIn page, DNV says: “DNV is the independent expert in risk management and assurance, operating in more than 100 countries. Through its broad experience and deep expertise DNV advances safety and sustainable performance, sets industry benchmarks, and inspires and invents solutions. Whether assessing a new ship design, optimizing the performance of a wind farm, analyzing sensor data from a gas pipeline or certifying a food company’s supply chain, DNV enables its customers and their stakeholders to make critical decisions with confidence.” DNV seems to be certifying all sorts of things; it recently was cited in another Centers of Excellence press release, this time in West Covina, Calif.

In Columbus, Ohio, “Columbus Regional Healthcare System recently achieved accreditation from SRC as a Center of Excellence in Robotic Surgery. This accreditation recognizes Columbus Regional’s commitment and high standard of delivery of quality patient care and safety. Status as an accredited Robotic Surgery Center of Excellence means that Columbus Regional has met nationally and internationally recognized standards. Not all hospitals and surgeons seek accreditation; not all that undergo the rigorous inspection process are granted accreditation.” SRC describes itself as “a nonprofit, patient safety organization that provides accreditations for surgical facilities and medical professionals.”

The Center of Excellence designation, depending on who grants it, can be given to a hospital for only a few specialties, apparently. Also the Center of Excellence designation is only one of the multiple awards and honors that hospitals claim. The Leapfrog Group and U.S. News and World Report grant “best hospitals” status, the Joint Commission grants a “gold seal of approval” and the American Heart Association grants various “gold awards,” to name a few.

Jeanne Pinder  is the founder and CEO of ClearHealthCosts. She worked at The New York Times for almost 25 years as a reporter, editor and human resources executive, then volunteered for a buyout and founded...