Working Together to Minimize Penalties and Maximize Efficiencies |
by Jennifer Wieckowski, MSG, State Program Director Chad Vargas, MHA, Associate Director Health Services Advisory Group The Changing Landscape of Payment Models Healthcare payment models are undergoing a transformation, incentivizing providers to shift from the
paradigm of “A for effort” to “A for outcomes.” These new payment models include penalties and
incentives to manage care more efficiently and are gaining traction in this changing healthcare
environment. One such model for a nursing home value-based purchasing program for readmissions
reduction, H.R. 4302 Protecting Access to Medicare Act of 2014, goes into effect in October 2018,1
with the publication of facility readmission rates scheduled to go live on Nursing Home Compare by
October 2017.2
The Latest on Hospital Penalties On October 1, 2014, the beginning of federal fiscal year 2015, the Centers for Medicare & Medicaid
Services (CMS) issued penalties for excess hospital readmissions that occurred between July 1, 2010,
and June 30, 2013, with more than 220 California hospitals being assessed penalties.3 In the previous
fiscal year 2014, hospitals were penalized up to 2 percent of their Medicare reimbursement for excess
readmissions in congestive heart failure, acute myocardial infarction, and pneumonia. The new fiscal
year 2015 penalties not only add chronic obstructive pulmonary disease and total knee and hip
arthroplasty into the penalty assessment, but increase the maximum fine to 3 percent. Moreover,
CMS recently announced that it will add coronary artery bypass graft readmissions to the hospital
penalty list starting October 2016.
Efficiency as an Incentive Medicare Spending Per Beneficiary (MSPB) is another hospital efficiency measure that was added to
the hospital value-based purchasing program on October 1, 2014. MSPB assesses Medicare Part A
and Part B payments for services provided to a Medicare beneficiary during a spending-per-beneficiary
episode that spans from three days prior to a hospital admission through 30 days after discharge. In the
value-based purchasing program, the highest performing hospitals (those with the highest efficiencies
based on a multifactorial assessment) will receive incentive payments, while the lowest performing
hospitals will be subject to a negative payment adjustment. By measuring cost of care through MSPB,
the transparency of care for consumers will increase, with hospitals involved in high-quality care at lower
cost to Medicare beneficiaries rewarded for their efforts.4,5 What This Means for Nursing Homes The readmission penalties and MSPB measures are intended to encourage hospitals to work with
post-acute care settings and community organizations to reduce Medicare spending. The impact
to hospitals can be greatly influenced by what happens in the nursing home to avoid a 30-day
readmission. It is in the best interests of both hospitals and nursing homes to work together to
identify opportunities for improvement that reduces cost, eliminates readmissions, and enhances
the patient experience. Health Services Advisory Group, the California Quality Improvement
Organization for Medicare, is ready to assist you in these efforts. For more information on value
based purchasing or other Medicare quality improvement initiatives, please visit our website at
www.hsag.com or call us at 818.409.9229.
[1]http://www.ahcancal.org/advocacy/solutions/Documents/Value%20Based%20Purchasing%20-%20IB.PDF [2]http://www.medicare.gov/nursinghomecompare/search.html [3]http://www.kaiserhealthnews.org/Stories/2014/October/02/Medicare-readmissions-penalties-by-state.aspx [4] Link to Medicare.gov - nursing home compare [5]http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/hospital-value-based-purchasing/index.html Want to discuss this article in the CALTCM Blog? Click here now! |