Value-Based Purchasing Demos Pay Off
The Centers for Medicare & Medicaid Services (CMS) announced Aug. 17 new results from three of its demonstrations and the start of three additional value based purchasing demonstrations.
“We continue to be encouraged by the progress of our ongoing programs that test value based-purchasing across a variety of health care services,” said Charlene Frizzera, Acting Administrator of CMS; “Building on those efforts, we are pleased to announce the start of our Nursing Home Value-Based Purchasing Demonstration and two gainsharing demonstrations.”
Hospitals Continue to Improve Quality
The Hospital Quality Incentive Demonstration (HQID), which began in 2003 with hospitals in 38 states, was designed to test payment incentives under Medicare to see if they would improve the safety, quality and efficiency of inpatient services by linking incentives to improved quality.
Participants raised overall quality by an average of 17 percentage points over four years, CMS reports, based on their performance on more than 30 nationally standardized and widely accepted care measures for patients in five clinical areas: heart attack, coronary bypass graft, heart failure, pneumonia, and hip and knee replacements.
CMS said it is awarding incentive payments totaling $12 million in year four to 225 hospitals for top performance, top improvements and overall attainment in the five clinical areas. Through the first four years, CMS awarded more than $36.6 million to top performers. After the initial three years of the demonstration, CMS extended the project for three additional years to test new incentive models and ways to improve patient care.
Physician Groups Improve Quality and Share Savings
All 10 physician groups participating in the PGP Demonstration achieved benchmark performance on at least 28 of the 32 measures reported in year three of the demonstration, according to CMS. Two groups – Geisinger Clinic in Danville, Penn. and Park Nicollet Health Services in St. Louis Park , Minn. – achieved benchmark performance on all 32 performance measures.
Over the first three years of the demonstration, physician groups increased their quality scores an average of 10 percentage points on 10 diabetes measures, 11 points on 10 congestive heart failure (CHF) measures, 6 points on seven coronary artery disease (CAD) measures, 10 points on two cancer screening measures, and 1 percentage point on three hypertension measures.
As a result of their efforts to reduce the growth rate in Medicare expenditures, five physician groups will receive performance payments totaling $25.3 million as part of their share of $32.3 million of savings generated for the Medicare Trust Funds in performance year three.
Incentive Payments for Quality Performance
CMS is also awarding approximately $7.5 million dollars in incentive payments to over 560 practices in California, Arkansas, Massachusetts and Utah that participated in the Medicare Care Management Performance (MCMP) Demonstration. The average payment per practice is $14,000, but some practices will receive as much as $62,500. Last year, CMS paid out over $1.5 million in incentives for reporting baseline quality measures.
The goal of the MCMP Demonstration is to promote the use of health information technology to improve the quality of care for beneficiaries with chronic conditions.
Doctors in small to medium sized practices who meet clinical performance standards on each measure are eligible to receive financial rewards under the MCMP Demonstration. The demonstration also provides an additional bonus to practices that report the data using an electronic health record (EHR) certified by the Certification Commission for Health Information Technology. Twenty-three percent of practices were able to submit at least some of the measures from a certified EHR.
New and Ongoing Demonstrations
The new nursing home demonstration program will reward facilities that can improve or deliver high quality care in four specific areas: staffing, resident outcomes, avoidable hospitalizations and reductions in deficiency citations.
From July 2009 through June 2012, nearly 200 nursing homes (79 in New York, 62 in Wisconsin, and 41 in Arizona) will participate in this demonstration.
The Medicare Hospital Gainsharing Demonstration began in October 2008. This demonstration consists currently of two sites: Beth Israel Medical Center in New York City and Charleston Area Medical Center in West Virginia. Under this demonstration, CMS will evaluate whether gainsharing leads to short-term improvements in quality and efficiency during the inpatient stay and immediately following discharge.
The Physician Hospital Collaboration Demonstration, comprised of a consortium of 12 hospitals administered by the New Jersey Hospital Association, began in July. This demonstration is designed to track patients beyond a hospital episode to determine the impact of hospital-physician collaborations on preventing short- and longer-term complications and duplication of services.
For another view of these demonstrations, read the AMNews story “Half of Large Practices Net Bonuses from Medicare P4P Demo.”
For additional information on value based purchasing demonstrations, visit the Demonstrations Web page.
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