Substandard care can lead to reduced payments for hospitals with excess readmissions.
Section 1886(o) of the Social Security Act establishes the Hospital Value-Based Purchasing (VBP) Program, which affects more than 3,000 hospitals’ payments for inpatient stays. The program’s primary objective is to reward acute-care hospitals for the quality of care provided to Medicare beneficiaries.
The Centers for Medicare & Medicaid Services (CMS) recently estimated that the total amount available to acute-care hospitals for VBP incentive payments in fiscal year 2019 is approximately $1.9 billion. VBP performance scores are based upon four factors, which are equally weighted:
The Hospital Readmissions Reduction Program (HRRP), which reduces payments to hospitals with excess readmissions, was established as part of the VBP Program and Section 3025 of the Affordable Care Act. Beginning in fiscal year 2019, the 21st Century Cures Act requires CMS to assess penalties based on a hospital’s performance relative to other hospitals with a similar patient mix (i.e., patients who are dually eligible for Medicare and full-benefit Medicaid). Although the payment reduction is capped at 3 percent, this could still have a significant impact on physicians and other healthcare providers.
In order to avert a payment reduction or penalty, it is imperative for physicians and hospitals to work collaboratively, especially in relation to the excess readmission rate for these six conditions/procedures:
In order to maximize the incentive payments available and avoid a payment reduction, a team-based approach is needed. Here are four suggestions for improving outcomes and, in turn, reimbursement.
By taking these steps, patients will have better outcomes through a collaborative approach, and physicians and providers will see a more robust revenue stream.
Rachel V. Rose, JD, MBA, advises clients on compliance and transactions in healthcare, cybersecurity, corporate and securities law, while representing plaintiffs in False Claims Act and Dodd-Frank whistleblower cases. She also teaches bioethics at Baylor College of Medicine in Houston. Rachel can be reached through her website, www.rvrose.com.