For a good part of Tuesday, health providers across the country lined up in a federal phone cue.
They'd been invited to a special forum to express their deep concerns about a major piece of health reform rules yet to be written; the ones that will take a huge chunk of their money.
Starting in just 24 months, hospitals falling under the Inpatient Prospective Payment System will automatically see their reimbursements drop by 1% for FY 2013, 1.25% for FY 2014, 1.5% for FY 2015, 1.75% for FY 2016 and 2% for FY 2017 and beyond—it says so quite plainly in section 3001 of the Affordable Care Act, Hospital Value-Based Purchasing Program or VBPP.
Some hospitals will be winners and earn some or all that money back, but that’s only if their scores on selected outcome measures — initially acute myocardial infarction, heart failure, pneumonia, surgeries, healthcare associated infections and patient satisfaction—are better than their peers.
Other hospitals which can't move as fast will see their reimbursements shrink for the year. By decree, this must be a zero sum game, for there are no extra dollars in the award.
During the call, hospital representatives sounded like they are nervously measuring their strides as they wait for the starting bell to go off in just 24 months. Will the rules, which have yet to be made public, be fair?
Centers for Medicare and Medicaid Services' chief medical officer, Barry Straube, MD, launched the phone conference forum by asking for help in writing the regulations. The intended goal: to accomplish what his new boss, Don Berwick, describes as the "Triple Aim: Better care for individuals, better health for populations, and lower costs in healthcare through improvement." That's so CMS can be transformed "from a passive payer of claims to an active purchaser of care."
Prior to the meeting, CMS prepared 10 questions to group concerns. Here's how some of the speakers replied:
1. What is an acceptable performance period to determine performance scoring and payment calculations?
"We would ask that any hospitals that do not have data in the baseline period, because they were not already participating in hospital inpatient quality reporting programs, that those hospitals simply be omitted from the (Value Based Purchasing Program) in the first year. No money would be withheld since they wouldn't be able to earn any money back since they didn't have baseline scores. We would hope no hospital would be doubly penalized." Beth Cameron Feldpush, American Hospital Association.
"(We hope that hospitals) will know all of their standards on which their performance will be assessed before the performance period begins. They will know the performance score they must achieve to earn back their full VBP set aside and they will know their VBP incentive will be calculated from their performance score." Christine Van Dusen of Premier Health Alliance.
2. What type of performance scoring methodology should CMS implement to have an immediate and significant impact on hospital performance that improves quality of care received by patients? How should the performance score determine the payment incentive?
"If CMS is serious about true process improvement in inpatient hospital unit, the proposal formulas for scoring against median and top percentiles for the country, this is essentially marking on the curve. It guarantees that even if everyone improves significantly there will be winners and losers. If absolute targets were the key and not percentile-based, true improvement would be rewarded. Otherwise the cynical response will inevitably be that this is a takeaway program masquerading as a quality initiative." Anthony Haftel, MD Franciscan Health System in Seattle.
"We would be interested in knowing if there are indeed increases above 100% in the form of bonuses to hospitals that report superior quality results." Barney Osborne, vice president for finance for the South Carolina Hospital Association.
3. What measures from the current Hospital Inpatient Quality Reporting Program measure set should be selected for the Hospital VBP program to drive quality improvement, and why? Which measures are most important, and how should they be weighted?
"(With respect to electronic medical records and meaningful use) VBP as it's shaping up looks like manual data extraction and a paper chase and the cost of that just doesn't justify the impact it will have on improving the health of people in our communities....It would be nice if VBP folks at CMS would walk across the hall and talk to the folks at ONC (The Office of National Coordinator for Health Information)." Stephen Grossbart, Catholic Healthcare Partners.
4. The legislation requires the inclusion of a Medicare Spending per Beneficiary efficiency measure, adjusted for age, sex, race, severity of illness and other factors? How should this be measured and how should risk adjustment be applied?
"I have concerns about the small rural critical access hospital, and about the ability for them to be successful. And once this is rolled out, how many of them will potentially close, and what will that do to access of care issues for rural people? What kind of burden will that place on tertiary hospitals?" Sherry Locke, St. Mary's Hospital in Nebraska City, NE.
5. The legislation calls for the Secretary to use the Hospital Compare website to include information that is useful to consumers and providers. What information should be included on the website? What performance data will be most useful to consumers and providers? What improvements should be made to the website?
"We recommend the Hospital Compare website show more variation among hospitals in their performance and include much more robust information about cost effectiveness and efficiency data as well as outcomes measures that we think should be far more well represented on the site." Leah Binder, CEO, The Leapfrog Group.
"A lot of my consumers in small rural areas don't know what Hospital Compare is. If they knew what it was, they might utilize it more to choose where they want to have their care." Dee Rogers of Magnolia Regional Medical Center, Magnolia, AR.
6. What are some of the unintended consequences that might result from implementing this hospital pay-for-performance program? How should CMS monitor the impact of the program on beneficiaries and the health care system?
"One unintended consequence will come if CMS shies away from introducing outcomes measures as core principles in VBP. One reason there might be some shyness is that there are no perfect outcome measures that absolutly everyone agrees are 100% indicative of the actual performance of a provider. If we let the ‘perfect’ substitute for the ‘good’, we will, in fact, not create a VBP that has enough teeth to make a difference either for providers or for consumers." Leah Binder, CEO, Leapfrog Group.
The proposal is (that) 60 days in advance, facilities would receive notification of potential losses based on performance. We would argue that even prior to that if there could be some advance warning system or ongoing tracking...that could give administrators [We would hope that CMS could] "give a prior notification or early warning or tracking ... that would give administrators and hospitals a heads up as far as what current performance means and subsequent losses. The unintended consequences could create knee jerk reactions based on losses, or not give enough financial planning for organizations that would suffer the most severe losses." Jessica Walker, the Gallup Organization.
7. What validation processes should be included in the Hospital VBP?
"[Electronic medical records] systems have not lived in the world of quality performance measurement. And often times, or at least right now, lack the rigor required of these calculations of complex algorithms and Boolean statements that are inherent in these specifications...I would urge to transition cautiously to the world of measures to the world of value-based purchasing until we fully understand this new world." Name unclear.
8. What appeals process should be included in the Hospital VBP?
"We would request that you consider not publishing results under appeals until appeals have been resolved and perhaps allow hospitals a chance to comment or protest if you decide to publicly publish before the issues are resolved."—Barney Osborne, vice president for finance for the South Carolina Hospital Association.
9. What are important elements of a Hospital VBP demonstration program to test innovative methods of measuring and rewarding quality and efficiency in Critical Access Hospitals, and hospitals with an insufficient number of cases or measures?
"Knowing that critical access hospitals rely very much on their relationship with hospitals to which they transfer, I think that measuring the accountability at the patient level in this process, so it's not just within the critical access hospital, would be a useful enhancement in terms of rewarding their ability to not only treat their own patients but also effectively and in a timely way triage their challenging patients to the referral centers. " Don Casey, Atlantic Health, Morristown, NJ.
10. What other considerations are essential to address in the development and implementation of a Hospital VBP program?
"We would urge CMS to consider when making VBP payment to consider making it in the form of a lump sum payment, for example [Perhaps pay] 80% of the hospital's estimated amount at the very beginning of the fiscal year. And then at the end, when the actual discharges are known, CMS could settle that amount. We think having a dedicated lump sum received by the hospital will help motivate them to improve their quality a little bit more." Joanna Kim with the American Hospital Association.)
CMS will review comments and concerns on the coming regulations if they are sent to HospitalVBP@cms.hhs.gov by Nov. 5.
The agency has a lot of work ahead to make sure the competition is a fair one. Yes, there will be winners and losers in this race, but let's hope that every hospital's performance will improve because of it. That, I think, was the idea from the start.