More Hospitals Gain Than Lose in FY 2020 Value-Based Purchasing Program

Medicare’s value-based purchasing program will reward more hospitals than it will penalize in FY 2020 through its value-based purchasing program.

The program, in which 2700 hospitals are scored in four domains – clinical outcomes, safety, person and community engagement, and efficiency and cost reduction – will distribute $1.9 billion in bonus payments to 1500 hospitals.

Bonus payment average 0.6 percent, with a high of 2.93 percent.  Penalties average -0.39 percent, with a high of -1.72 percent.

Overall, rural hospitals performed better in the safety, person and community engagement, and efficiency and cost reduction categories and had a higher average score nation-wide while urban hospitals produced better clinical outcomes.  Smaller hospitals performed better in safety, person and community engagement, and efficiency and cost reduction.

Hospitals can find a link to their own adjustments here.

Learn more about how Medicare’s value-based purchasing program works and how hospitals will fare in FY 2020 in this CMS fact sheet.

Stark Changes Coming to Facilitate Value Care?

At a Washington, D.C. conference, Centers for Medicare & Medicaid Services Administrator Seema Verma announced that changes coming in Stark law requirements will enable Medicare to make better use of value-based purchasing in its reimbursement system.

In addition to addressing cybersecurity and electronic health record system issues, changes in the anti-self-referral law will seek to facilitate better coordination of care for Medicare patients.  Verma explained the underlying rationale for the anticipated changes, noting that

…in a system where we’re transitioning and trying to pay for value, where the provider is ideally taking on some risk for outcomes and cost overruns, we don’t have nearly as much of a need to interfere with who’s getting paid for what service.

Learn more from the Fierce Healthcare article “Verma promises hospital industry ‘significant’ Stark Law changes later this year.”

Safety-Net Hospitals Struggle in Medicare Joint Replacement Model

Non-safety-net hospitals are outperforming safety-net hospitals in the Comprehensive Care for Joint Replacement model introduced in 2016.

According to a new study published in Health Affairs,

…in comparison to non-safety-net hospitals, 42 percent fewer safety-net hospitals qualified for rewards based on their quality and spending performance (33 percent of safety-net hospitals qualified, compared to 57 percent of non-safety-net hospitals), and safety-net hospitals’ rewards per episode were 39 percent smaller ($456 compared to $743). Continuation of this performance trend could place safety-net hospitals at increased risk of penalties in future years.

What might be done to address this disparity?  The study suggests that

Medicare and hospital strategies such as those that reward high-quality care for vulnerable patients could enable safety-net hospitals to compete effectively in CJR.

Learn more in the Health Affairs article Performance of Safety-Net Hospitals in Year 1 of the Comprehensive Care for Joint Replacement Model.

 

Medicaid APMs Moving in New Directions

For the most part, states’ use of alternative payment models in their Medicaid programs so far have focused on the work done by primary and acute-care providers.  Now, a number of states are starting to extend their use of APMs in other areas, including:

  • behavioral health providers
  • safety-net providers
  • long-term care providers

Because safety-net hospitals serve so many more Medicaid patients than the typical hospital, they are more likely to be affected by this trend in the coming years.

For a look at what states are doing to drive value in Medicaid payments in these new areas, see the Commonwealth Fund article “The Next Generation of Paying for Value in Medicaid,” which can be found here.