Hospitals are continuing to focus on innovative ways to interact with patients as CMS eases reporting requirements.  But there’s more work to be done to engage patients effectively as hospital value based payments efforts increase. At stake is approximately $1.9 billion available in 2018 to reward high-performing hospitals, Modern Healthcare reports.  And on the flip side there are penalties — Becker’s reports that for the 2017 fiscal year, around half of the hospitals in the United States were dinged with an estimated $528 in readmission penalties for the year.

Hospital Value Based Payments Update

Hospital value-based payments focus is becoming more intense in 2018.

“…healthcare systems need to get past the idea that simply by building a portal they have successfully addressed the need to engage patients in order to improve outcomes.” — From a Becker’s Hospital Review article on completing the “patient engagement circuit

In an overview article about value based payments in Becker’s Hospital Review, the climate is summed up like this:  “Within the industry, more than a third of healthcare professionals surveyed this past November said their organizations are moving toward value based payments [VBP] at a moderate pace, and another 27 percent said their pace is fast or very fast. Major health insurers are implementing VBP programs. And a survey of healthcare executives completed last year found two-thirds plan to increase clinical registry participation in the next five years. Registries can provide measurement infrastructure needed for VBP programs.”  And the good news is that at the same time, Centers for Medicare and Medicaid Services’ (CMS) is “reducing administrative burdens that the agency’s quality reporting and value based payment programs place on physicians and hospitals.”

We reviewed a PDF provided by CMS on VBP, which they define as “value based purchasing” (the alternate wording is value based payments).  According to their reference report, “The Hospital Value Based Purchasing (VBP) Program is a Centers for Medicare & Medicaid Services (CMS) initiative that rewards acute-care hospitals with incentive payments for the quality care provided to Medicare beneficiaries. Section 1886(o) of the Social Security Act establishes the Hospital VBP Program, affecting payment for inpatient stays in more than 3,000 hospitals across the country. This program is part of CMS’ larger quality strategy to reform how healthcare is delivered and paid.”

CMS rewards hospitals based on:

  • The quality of care provided to Medicare patients
  • How closely best clinical practices are followed
  • How well hospitals enhance patients’ experiences of care during hospital stays

Other Questions about Hospital Value Based Payments

How are hospitals doing in this VBP program?  Modern Healthcare is reporting that “about 57% of hospitals will receive Medicare bonuses in 2018, compared to 55% of hospitals this year. The number of hospitals that saw their payments docked also fell from 1,343 in 2017 to 1,211 in 2018, according to a Modern Healthcare analysis of the data. The total number of hospitals part of the program declined from 2,955 in 2017 to 2,808 in 2018.”

What if care can extend beyond the discharge of a patient?  In the weight scale for how CMS grades a hospital on VBP, 25% is given to a measure called, “Person and Community Engagement.”  A recent Becker’s Hospital Review article takes a position that remote patient monitoring is the best way forward for value based care and offers a number of benefits. “Proactive, automated care is the future of healthcare. In the case of remote patient monitoring, home health kits are constantly capturing and sharing data with care teams, and patient issues are caught earlier, enabling effective remote triage for patients to reduce unplanned care and prevent escalations to more intensive, costlier interventions.”

What role does data play in hospital value based payments?  It’s central.  Recently, Becker’s came out with a list for “7 key stages to success in value based care”.  The steps are:

  • Find the data.
  • Capture the data.
  • Normalize the data.
  • Aggregate the data.
  • Report the data.
  • Understand the data.
  • Act upon the data.
SSI Group Analytics Solution for Nebraska Medicine:  The esteemed Nebraska Medicine academic health system with two hospitals, 809 beds and more than 1,000 physicians has implemented SSI Claims Analytics in conjunction with it’s EPIC, HFMA, and other business intelligence software.  The revenue cycle team discovered that our solution offers instant access to claims-related data in a responsive, one-stop, user-friendly format. “What we noticed was an ability to get to the level of detail necessary for process improvement, all in one precise location”, stated Jana Danielson, MS, FHFMA, Executive Director of Revenue Cycle for the health system.  » Read more about this case study and get related data sheets here.  

The American Academy of Family Physicians (AAFP) also has a good 17 item list of “Value-Based Payment Principles” that includes being flexible in the following ways:

  • Responsive to community needs, preferences, and resources
  • Adaptable to different practice organizational models, structures of care, and physician specialties
  • Responsive to individual patient preferences and socio-cultural backgrounds
  • Respectful of differences in adoption of health information technology (HIT) while encouraging its effective spread

In the end, another article from Modern Healthcare sums up the VBP situation for hospitals well:  “Hospitals can’t afford not to provide value based care”. The article details the thinking at a recent HFMA meeting where one presenter commented about hospital value based payments, that “it’s been a topic of discussion at the annual conference for years. But this year, conversations seemed to indicate a breaking point. Healthcare costs are unsustainable, and anyone not on the capitation train—or at least without a ticket in their hand — is part of the problem, presenters echoed.“