Newest Value-based Purchasing Penalties, Bonuses Draw Fire From Critics

By Jill Drachenberg, Editor, AHC Media

The number of hospitals receiving bonuses under the Hospital Value-based Purchasing Program fell by 200 for fiscal year 2017, according to data released by the Centers for Medicare & Medicaid Services (CMS). The news drew fire from program critics who want to see the program scrapped.

More than 1,600 hospitals will receive bonuses in 2017, a collective $1.8 billion. The highest-ranking hospital will receive a 4% increase, while the lowest performer will see a 1.83% cut in pay. The number of penalized hospitals grew to 1,343 in 2017, up from $1,236 in 2016. Many hospitals will receive a bonus in 2017, but more than half will get a smaller amount than the previous year.

Critics of value-based purchasing are concerned about the growing number of penalized hospitals as well as the stagnation of those receiving bonuses. "It's not as if you have a specific target — you could meet that target, but if everyone meets that target, you're still in the middle of the pack,” said Francois de Brantes, executive director of the Health Care Incentives Improvement Institute.

A study published in BMJ in spring 2016 revealed there is little evidence to show that value-based purchasing improved care quality or mortality rates. “I think it allows us to feel like we're doing something on trying to improve patient outcomes,” said lead study author Ashish Jha, MD, MPH. “We want to be able to say we're paying for quality.”