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One big step toward value-based with CMS issuance of proposed rule
Experts pose many potential problems in proposed version
Value-based purchasing has been a much-used term, and the evolution to such a system has been long held as a reality for the future. It's closer than ever now, as the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule Jan. 7 for the establishment of the value-based purchasing (VBP) system in health care.
However, the road is still unclear, experts say. And their concerns with the proposed rule may signal a very busy comment period, which ends March 8.
What we know now
As part of the Patient Protection and Affordable Care Act of 2010, CMS is required to provide hospitals value-based incentive payments by fiscal year 2013. The payments are to correspond with both a hospital's achievement of selected measures and its improvement over a specific time period on those same measures.
For the FY 2013 VBP program, CMS has chosen 17 clinical measures, as well as eight measures from the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey (see box, below). In FY 2014, CMS proposes to add three mortality measures, eight hospital-acquired condition measures, and nine Agency for Healthcare Research and Quality (AHRQ) Indicator outcome measures. The change in hospital payments will take effect in fiscal year 2013 beginning with discharges on Oct. 1, 2012.
CMS is required to keep the program budget-neutral and within the proposed rule laid out a reduction in base operating DRG payments at 1% in FY 2013, to increase to 2% by FY 2017. CMS proposes to calculate hospitals' achievement score from 0 to 10 points for each measure when during the performance period the hospital's achievement falls in the median of aggregate hospitals' performance and a national benchmark. The improvement score, from 0 to 10 points, would be based on how much a hospital's performance improves on a measure during a performance period versus the performance in the base period. A hospital would then receive the higher score from the achievement or improvement finding. For FY 2013 measures, CMS has set a baseline period of July 1, 2009, to March 31, 2010, and a performance period of July 11, 2011, through March 31, 2012.
For the HCAHPS, or patient care experience, measures, hospitals would receive scores based on achievement, improvement, and consistency, and can receive 0 to 80 points. For improvement scores, a hospital could get 0 to nine points, and for consistency 0 to 20. A total performance score then would be determined by combining the scores for process measures and patient care experience measures. CMS proposes to assign a weight of 70% to the clinical measures and 30% to the HCAHPS measures.
In choosing clinical measures for inclusion, CMS said it would exclude those quality measures that are "'topped out,' meaning that all but a few hospitals have achieved a similarly high level of performance on them. We believe that measuring hospital performance on topped-out measures will have no meaningful effect on a hospital's total performance score." The agency identified seven measures as "topped out":
What it means to you
The proposed rule "just underscores something that's already been in place, and that is the importance of having some kind of process in place for ensuring that things get documented while patients are in the hospital," says Patrice Spath, of Brown-Spath & Associates in Forest Grove, OR.
Of the measures proposed for inclusion, Spath says hospitals have been reporting on these for some time now, so none of it is new in that regard.
As far as the financial effects the rule could have, Spath says, "Since it has to be budget-neutral, it's really just moving money around. So there won't necessarily be a bigger pot of money available, but it may be that the hospital down the road gets a little bigger piece of the pie and you get a little bit less because of this.
"But it's hard to calculate what the financial incentive is. And studies of the demonstration projects that were done with Premier found that without a significant financial incentive, that hospitals just didn't spend the dollars that were necessary to get their scores up," she says.
She also says it is difficult to see the financial effect of the improvement portion of the scoring methodology. "What happens when you're at 100% all the time?" she asks.
Matthew Vogelien, director at Huron Consulting Group in Chicago, agrees that the financial impact, at this point, is hard to forecast. "We field a lot of questions about, 'What's the real financial impact, or financial benefit, if you will, of this?' And I think, unfortunately, it's a little bit of wait and see... I think there is still just a lot of gray area there."
Spath says the impact of the 1% reduction "depends on the percent of patients that you have who are Medicare patients." She notes, too, that presently there's no adjustment for the size of hospital. Critical access hospitals are excluded from the program.
She says she would expect that adjustment to be included. "If they're using percent of improvement, they give you certain numbers. If you have 10,000 patients versus 1,000 patients, that percentage is obviously going to be impacted by that denominator."
Documentation and data integrity will continue to become more and more integral to the quality improvement director's job, Spath says. Make sure your data are high-quality, she adds. The question quality managers should be asking, she says, is: Do we have a system in place to ensure that the data we're sending to CMS are accurate?
"You were getting paid for reporting before. Now the quality of the data will actually impact your reimbursement. Do you have a system in place for clinical documentation improvement?" she says.
Vogelien says, too, he is hearing questions from clients about what happens if there are glitches in your reporting processes. For the quality measures themselves, hospitals are used to reporting on them as part of the Hospital Inpatient Quality Reporting Program. So, many of his clients are looking at the VBP program as a positive thing. But they question what will happen if after self-reporting they find problems in measurements, for example. What kind of oversight model is out there? he says.
Beyond sorting those things out for the VBP program, "one of the things that's going to happen in the midst of all of this is the transition to ICD-10," Spath says. "And in order to accurately code things in ICD-10, especially on the procedure side, things have to be very clearly documented. So there's already under way in organizations a push to improve the clinical documentation in patient records." Ratcheting up documentation, not only for Medicare patients in terms of VBP, but for all patients in terms of ICD-10 is more important than ever.
Another area for hospitals to look at is HCAHPS scores. "The problem you run into," Spath says, is that patients' "perception is impacted by things that oftentimes are outside of your control."
Referring to the possibly variable impact the rule would have on hospitals of differing sizes and populations, Regan E. Tankersley, attorney with Hall Render, says, "Any time there is going to be anything new to the payment system, it's always a wait and see. How practical is it going to be? How burdensome is it going to be?" Echoing what most experts told Hospital Peer Review, she says the end result for hospitals is yet to be seen, especially as there could be many iterations before a final rule. She asks: "[Is CMS] going to take into account providers of the same size? Is it going to be just completely based on the number of procedures and quality?..."
"It could be difficult for smaller providers that don't have this type of infrastructure that may have had difficulty reporting the quality data," she says. "Depending on what their systems are, they're going to have to get up to speed. I think it's always the smaller hospitals who struggle when things like this come across because it might not be cost-effective for them initially to a put a lot of money into an infrastructure, especially when you don't know how the calculations are going to come out in the end," she says.
Proposed measures for FY 2013 VBP program
Acute Myocardial Infarction
Patient Experience of Care Measures
Source: Centers for Medicare & Medicaid Services.