Pay For Performance:
IS P4P LOSING STEAM?
Published on Thu Feb 15, 2007
Coming MedPAC report may dampen enthusiasm for new incentive-based model.
A year ago, it looked like home health agencies would have to gear up for a Medicare pay for performance system right away. Now, experts aren't so sure.
When the Democrats won both houses of Congress in the last elections, P4P slipped down on the Medicare priority list. "Congress remains interested [in home health P4P], but not as much as when the Republicans were in power," judges William Dombi, vice president for law with the National Association for Home Care & Hospice's Center for Health Care Law.
And now the congressionally mandated June report from the Medicare Payment Advisory Commission may further dampen enthusiasm for the payment model, if it reflects MedPAC commissioners' concerns aired in a March 8 meeting.
The basic set-up: MedPAC staffer Sharon Cheng once again proposed that the influential advisory body to Congress recommend a home health P4P system based on OASIS reporting. The system would compare Medicare patients in the same diagnosis group and would reduce overall payment rates to fund an incentive pool. The example used in the meeting re-duced rates by 5 percent to form the pool.
As suggested at MedPAC's last meeting, the report would recommend a system where agencies could pool data by combining two years' data or joining voluntary pooling associations (see Eli's HCW, Vol. XVI, No. 4). Patients whose chosen quality measures improve would count twice as much as patients whose measures stabilize.
The highest-performing agencies would receive a full bonus payment while agencies that exceed minimum standards and reach certain levels of improvement would receive a half bonus payment, Cheng suggested. The lowest-performing agencies would see reduced payment rates.
How it would work: The Centers for Medicare & Medicaid Services would have to reduce rates by the specified amount--in the example, 5 percent--at the beginning of the P4P period. Then after the period was over, CMS would calculate agencies' scores and distribute the withheld funds accordingly. Home Health P4P Riddled With Problems MedPAC commissioners were quick to point out the many flaws and challenges of a home health P4P system. Gaming of the system via OASIS could be a big problem, warned Commissioner Nancy Kane with the Harvard School of Public Health. When OASIS "starts to be the reason that you're paid ... a bonus or not, it's very subject to manipulation," Kane said in the meeting.
Agencies could also skew their data by cherry-picking patients, cautioned Commissioner Ralph Muller with University of Pennsylvania Health System. Policymakers should be careful to "reward performance rather than case selection," Muller said.
On one hand: Settling on a bonus pool size is also problematic. Withholding a percentage of reimbursement to fund a much-delayed bonus could be a significant financial hardship [...]
