CMS proposed rule links payments to QI
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Proposals included in the rule would help support the Obama Administration’s efforts to reform healthcare delivery by improving care quality and patient outcomes, addressing long-term healthcare cost growth and supporting the goals of the recently announced Partnership for Patients, according to CMS.
The proposed rule would update payment policies and rates for acute care hospitals paid under the Inpatient Prospective Payment System (IPPS), and for hospitals paid under the Long Term Care Hospital Prospective Payment System (LTCH PPS). The rule would also improve and expand the Hospital Inpatient Quality Reporting Program (IQR) to focus on patient outcomes and experiences of care, and would establish a new quality reporting program for hospitals paid under the LTCH PPS.
Improving patient care
The proposed rule includes several proposals that expand quality and patient safety efforts across the Department of Health and Human Services, including the Partnership for Patients, CMS stated. The Partnership for Patients is a new public-private partnership that aims to improve the quality, safety and affordability of healthcare for Medicare, Medicaid and Children’s Health Insurance Plan (CHIP) beneficiaries.
To provide hospitals with an incentive to improve care coordination, the Patient Protection & Affordable Care Act (PPACA) directs CMS to implement a Hospital Readmissions Reduction Program that will reduce payments beginning in FY 2013 to certain hospitals that have excess readmissions for certain selected conditions.
The new rule proposes measures for rates of readmissions for three conditions—acute myocardial infarction (heart attack), heart failure and pneumonia. CMS is also proposing a methodology that would be used to calculate excess readmission rates for the program. The adjustments will apply to hospital payments in FY 2013, beginning with discharges on or after Oct. 1, 2012, CMS stated.
The proposed rule encourages improvements in the quality of care in hospital inpatient settings, and would align the existing inpatient quality reporting program with a proposed new hospital value-based purchasing program required under PPACA.
Payment updates
The proposed rule would apply to approximately 3,400 acute care hospitals and roughly 420 LTCHs, and would be effective for discharges occurring on or after Oct. 1, 2011. Under the proposed rule, CMS projects that Medicare operating payments to acute care hospitals for discharges occurring in FY 2012 would decrease by a projected $498 million or 0.5 percent in FY 2012 relative to FY 2011.
This includes a hospital update of 1.5 percent as well as a documentation and coding adjustment of -3.15 percent to account for changes in documentation and coding following adoption of the Medicare severity diagnosis-related groups that did not reflect actual increases in patients’ severity of illness.
Medicare payments to LTCHs in FY 2012 are projected to increase by $95 million, or 1.9 percent, according to CMS.
CMS will accept public comments on the proposed rule until June 20, 2011, and will respond to them in a final rule to be issued by Aug. 1, 2011, the agency stated.
Click here to download the proposed rule from the Federal Register. For more information about the proposed rule, click here.