Sneak peek: CMS previews value-based purchasing program

Many facilities still concerned about program's complexity

In anticipation of CMS' value-based purchasing program, hospitals last week received an advance look at how much they might be paid, but many administrators continued to express concern over some calculations.

VBP Program
The VBP Program—first announced as part of the federal health reform law—represents CMS's first major step into pay-for-performance. Under the initiative, CMS starting in FY 2013 will "withhold" a portion of hospital payments each year (1% in FY 2013 and gradually increasing to 2% by FY 2015 and beyond) and redistribute these funds as incentive payments to hospitals based on their performance across select groups of quality measures.

The budget neutral nature of the program means there will be winners and losers. Eligible hospitals that perform better than the national median will receive an increase in payments, while eligible facilities that perform worse will experience a loss.

CMS offers 'dry run'
CMS on Feb. 29 released simulated VBP reports for all hospitals on its QualityNet website. According to the agency, the reports—which are not publicly available—aim to educate hospitals about the program before its launch.

The dry-run reports are divided into seven sections and provide a general program overview, as well as data for 12 clinical process-of-care measures and eight "dimensions" of patient experience specific to each hospital. A hospital's estimated incentive payment percentage also is included in the report.

Although the measures included in the dry-run will be used to calculate 2013's incentive payments, CMS noted that the reports are based on a different time period than the actual program. "The report does not indicate how your hospital will actually perform in FY 2013, or whether your hospital will be eligible for the FY 2013 value-based purchasing program," CMS said.

Hospitals express concern over patient satisfaction metrics
Many hospital executives said the dry-run reports were a valuable tool that could help prepare facilities for the VBP program. However, many continued to express concern about being reimbursed based on the program's eight Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) dimensions, which they say are based largely on patient perception.

Hospitals also expressed concern over CMS' use of consistency points for HCAHPS. Consistency points—which are based on each facility's lowest dimension score—are awarded in addition to improvement and achievement points. For clinical process-of-care measures, CMS awards just improvement and achievement points.

"It's a very odd construction that intuitively does not make sense to hospitals and is inconsistent with the way they have constructed any other part of the program," said Nancy Foster, the American Hospital Association's vice president for quality and patient-safety policy (McKinney, Modern Healthcare, 3/3 [subscription required]).

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