IPPS puts quality at payment’s center in 2015
More to gain, more to lose
Last year, a 1.25% reduction in hospital costs by the Centers for Medicare & Medicaid Services (CMS) fed the quality bonuses at hospitals — more than 600 received something for their efforts, while more than 700 lost something for their perceived lack of it. This year, the bonus pool is being funded by a 1.5% decrease in costs, estimated to be some $1.4 billion up for grabs. Hospitals will be judged on four domains and 19 measures, up from three domains and 17 measures last year. (See box on measures for fiscal year 2015, page 113.)
Note that starting next year, fiscal year 2016, all your quality data needs to be submitted using the new ICD-10 coding, says Patrice L. Spath, MA, RHIT, a quality specialist and consultant with Brown-Spath & Associates based in Forest Grove, OR, and HPR’s consulting editor. If you aren’t on board yet, you need to get there. While there was a delay implemented at the last minute on the new coding this year, Spath says it is extremely unlikely there will be another one.
The penalties hospitals face for patients bouncing back are going up under the payment system this year. While last year the penalty was a maximum of 2%, this year it is 3% after adjusting for case severity. And hospital-acquired conditions will cost hospitals, too: 1% penalties for hospitals in the bottom quarter of performers.
"I do not see a lot of unexpected changes," says Spath. "The penalties are worse, but I still question why it is chiefly the job of hospitals to drive patient care coordination efforts," she says. "Physicians need to have some ownership — some type of penalties — when one of their patients is readmitted to the hospital. It is the hospital that gets dinged financially, not the primary care physician."
That means hospitals have to be the "stick" to enforce, to galvanize the wider healthcare community to come together and create the kinds of systems that work for patients so that they do not come right back to the hospital after discharge.
The fact that hospitals are buying physician practices may help, in that they can then set performance goals for the physicians that include factors that might lead to readmission post-discharge — like seeing patients in a timely manner after they get out of the hospital.
But hospitals can also influence physicians who aren’t employed by them, says Spath, through the medical staff credentialing process. "Be sure that part of their reappointment involves looking at practice patterns and determining whether a particular physician has a higher than average readmission rate. This used to be denounced as unfair economic credentialing’ but today it is an important component of your system. They need to help you meet CMS expectations, even if they are independent physicians. They have to have a stake in this, too."
Despite the concerns, the two-midnight rule stands, at least for now. The rule calls for further comment and work on issues like short stays — those that are shorter than two days but which need to be inpatient, not outpatient. Spath notes that future changes to this rule might affect how inpatient readmission rates are calculated. For instance, if more patients can be classified as inpatient, will readmission rates go up?
Spath also has concerns about access and quality of care that could hurt certain kinds of patients — those with chronic and potentially expensive illnesses. There have been stories already about people with HIV who are dissuaded from joining certain health plans because of the high-cost, front-loaded drug deductibles. Obese people, those who smoke or have a history of mental health problems — "I am concerned that these people will face health care access obstacles or not be readmitted when they need to be because of the fear of financial penalties," she says.
People with chronic conditions get sick and require hospitalization. As their disease worsens, Spath notes, they often require readmission. "It looks like CMS is continuing to emphasize a reduction in readmissions, and it looks sometimes like it is a fight against Mother Nature. How do you legislate against the progression of a disease?"
While the readmission reduction program does include some stratification based on case severity, Spath says it does not sufficiently account for important socio-economic factors. Inner-city hospitals will probably find themselves facing greater penalties until that is taken into consideration, she says.
"Hospitals need to get the stakeholders together and sit down to come up with the strategies that will work for patients in your community," Spath says. "That includes patients, and their families and other carers." Everyone around that table needs to talk about how to reduce readmissions and what the obstacles are to doing that.
"Understand that habits, particularly among low income and dual-eligible patients, are hard to break," says Spath, recalling some work in Oregon that looked at how to get such patients to stop using emergency departments for primary care. "Even when they had Medicaid and a primary care physician, they were still coming to the ED." Finding out from the patients themselves why they do what they do may be the difference between paying that 1% penalty and not paying it. "You will have to build a system around what the community needs and what they are willing to do to get it. That will take time and money. But the question is whether you want to spend the money now, or pay it in penalties later," she says.
The complete IPPS final rule was published in the Federal Register and can be found at https://federalregister.gov/a/2014-18545. Information on the quality measure specifications can be found at http://www.qualitynet.org.
In a subsequent rule published on September 4, Spath noted that hospitals and other eligible providers were granted more flexibility to meet criteria under the meaningful use Electronic Record Incentive Program. "The final rule, proposed in May, allows eligible providers unable to implement 2014 Edition certified electronic health record technology (CEHRT) due to availability, to use the 2011 Edition CEHRT or a combination of 2011 and 2014 Edition CEHRT for an EHR reporting period in 2014," she explains.
However, eligible professionals, eligible hospitals, and critical access hospitals will be required to use the 2014 Edition CEHRT in 2015. The rule also finalizes the extension of stage 2 through 2016 and sets stage 3 to begin in 2017. More information is available at: https://www.federalregister.gov/articles/2014/09/04/2014-21021/medicare-and-medicaid-programs-modifications-to-the-medicare-and-medicaid-electronic-health-record.
For more information on this topic, contact Patrice L. Spath, MA, RHIT, Health Care Quality Specialist, Brown-Spath & Associates, Forest Grove, OR. Telephone: (503) 357-9185.