Thursday, April 17, 2014

Final IPPS Rule Has Three New Value-Based Purchasing Measures, Finalizes Readmissions Factors

Posted: August 1, 2012

CMS' final hospital inpatient prospective payment rule finalizes three new measures for the fiscal year 2015 hospital value-based purchasing program, which is mandated by health reform, and finalizes the methodology and payment adjustment factors for the hospital readmissions reduction program. The agency also chose not to adjust the readmissions measures for socioeconomic status, rejecting a push by several hospital groups for CMS to account for such factors.

CMS said that it did not want to hold hospitals to different standards when it comes to outcomes for certain patients and because its analysis showed that socioeconomic status does not determine hospital performance on the readmissions measures. Teaching hospitals, however, said excluding socioeconomic factors has disproportionate consequences on teaching hospitals, which treat medically complex and vulnerable patients.

But, CMS said, "Many safety-net providers and teaching hospitals do as well or better on the measures than hospitals without substantial numbers of patients of low socioeconomic status."

In response, Premier healthcare alliance reiterated Wednesday (Aug. 1) that abundant evidence suggests that socioeconomic factors such as poverty and race are associated with readmissions, and it is disappointing that CMS didn't take any of those factors into account in the readmissions measures.

Medicare should adjust for socioeconomic factors by calculating rates for dual-eligibles -- those eligible for both Medicare and Medicaid -- and blending it with non-duals, Premier adds.

"Failure to do so not only holds hospitals responsible for readmissions they can't prevent, but it also penalizes safety net hospitals that provide care to disadvantaged people and communities," Premier Senior Vice President of Public Affairs Blair Childs said in a statement.

The new measures that will be included for the 2015 value-based purchasing program include two new outcomes measures -- a central line-associated blood stream infection measure and a patient safety indicator composite measure -- plus a Medicare spending per beneficiary efficiency measure.

CMS writes that some commenters strongly supported the inclusion of the Medicare spending per beneficiary measure, saying, "These commenters noted that cost information is valuable, when combined with other quality measures, in assisting patients, purchasers and policymakers in identifying value in healthcare."

Others praised CMS for trying to develop a spending measure but said this specific measure should undergo further development before being included in value-based purchasing. And the agency also heard general opposition to the measure, writing that some commenters said they were concerned that rewarding or penalizing providers based on expenditures per patient could encourage cost cutting at the expense of providing good care.

CMS says the final rule's policy "strengthens" the program. The first year that incentive payments will be made to hospitals under value-based purchasing is 2013, and incentive payments will be made beginning in January of next year with respect to discharges occurring in fiscal year 2013.

In the rule, CMS also finalizes a review and corrections process that will let hospitals correct their performance data before it is made public on the Hospital Compare web site. Hospitals will also be able to appeal the calculation of their performance assessment for their total performance score, CMS says.

The final rule also finalizes the methodology and payment adjustment factors to account for excess hospital readmissions for three conditions: heart attack, heart failure and pneumonia. CMS estimates that the readmissions program will result in an approximately $280 million decrease -- .3 percent -- in overall hospital payments.

CMS notes in the final rule that several commenters expressed concern that the readmissions program might spur overcrowding of emergency rooms because hospitals might try to avoid readmitting patients, and many said they did not think the measures sufficiently account for quality. -- Rachana Dixit (This e-mail address is being protected from spambots. You need JavaScript enabled to view it )

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