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CMS Plan Would Tie Efficiency Scores to Hospital Payments

Cheryl Clark, for HealthLeaders Media, May 2, 2012

Medicare officials have quietly posted on the Hospital Compare website a "cost per Medicare beneficiary" score for acute care hospitals. The data shows a 3.1-fold difference in costs across the country.

Anyone may download Hospital Compare data to see comparative risk-adjusted scores for every hospital. Users may compare the most and least expensive among 3,375 hospitals provided for an "episode" of care, described as a point three days prior to admission to 30 days after discharge for care delivered by any provider paid under Medicare Part A or Part B.

This score "is important, because it complements the quality and outcome measures to be used in assessing hospitals’ performance," Centers for Medicare & Medicaid Services spokesman Don McLeod, said in an e-mail.

Hospital leaders worried
But this new and very public way to evaluate acute care has many hospital leaders worried. Some say the scores, which are based on providers' Medicare claims, aren't fair or accurate.

Moreover, under authority from the Affordable Care Act, Medicare's latest Inpatient Prospective Payment System rule proposes to use "cost per Medicare beneficiary" as a significant chunk—20%—of a hospital's value-based purchasing score to determine incentive payments for discharges starting Oct. 1, 2014. 

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