Jennifer FaerbergDirectorHealth Care Affairsjfaerberg@aamc.org

Medicare Hospital Value-Based Purchasing (VBP) Program – Proposed Rule

Published January 13, 2011 (76 Fed. Reg. 2454)Comments Due: March 8, 2011

• Final Rule will be effective October 1, 2012• Move from pay-for-reporting to pay-for-performance• Must meet thresholds based on achievement or

improvement to receive incentive payment• Phased-in reduction to base DRG payment to fund

incentive pool: 1% for FY2013 increasing by quarter increments annually up to 2% in FY2017

• Applies to base DRG payment only; does not affect IME, DSH and outlier payments

• Budget neutral – all funds are returned to hospitals• Federal Register Notice (published on January 13)

http://www.gpo.gov/fdsys/pkg/FR-2011-01-13/pdf/2011-454.pdf

Overview

Measures/Dimension

Domains

Total

Performance Score

Process

17 Process Measures

HCAHPS

8 Dimensions

Outcomes

(FY2014)

21 measures

Structure of VBP Scoring

Baseline period = July 1, 2009 – March 31, 2010Performance period = July 1, 2011 – March 31, 2012

Patient Care Domains

FY 20013 FY 20014(%TBD)

Process Measures

70%

HCAHPS30%

Outcomes

HCAHPS

Process Measures

• FY 2013 • 17 clinical process of care measures• 8 HCAHPS dimensions (aka ”Patient Satisfaction”)

• FY 2014 (FY2013 measures plus):• Hospital Acquired Conditions, Patient Safety

Indicators• 30-day mortality (AMI, HF, PN)• Efficiency

• Medicare Spending per Beneficiary

Measures

• Points for achievement and improvement; whichever is higher = score• Achievement points based on actual performance

compared to threshold and benchmark• Improvement points based on actual performance

compared to baseline• Consistency points (HCAHPS only) based on

performance across dimensions

• Threshold = median (50th percentile)• Benchmark = mean of top decile of performance in

baseline period (95th percentile for HCAHPS)

Scoring Methodology

3 Scenarios:Performance Exceeds Benchmark

Performance Between Threshold & Benchmark

Performance Below Threshold

Achievement vs. Improvement

Threshold Benchmark

Threshold Benchmark

Threshold Benchmark

Full Achievement Points

Partial Achievement Points OR Possible Improvement Points

Possible Improvement Points – No Achievement Points

Notification of estimated value based payment

60 days prior to October 1, 2012

Notification of actual value

based payment

November 1, 2012

CMS processing systems updated

in

January 2013

Reduction/bonus (per discharge)

Timing of Initial Incentive Payments

• Weighting of measure domains (Process vs. HCAHPS)• Percentile scoring (consistency points) in HCAHPS• Where to set thresholds and benchmarks• Proposed FY2014 measures

• Hospital Acquired Conditions• AHRQ Patient Safety measures• Efficiency

• Medicare spending per beneficiary

Issues and concerns