PI CME: Are There Opportunities in Healthcare Reform?

How Quality Will Pay for Hospitals Under New Reform Measures
HealthLeaders Media, Janice Simmons, May 12, 2010

“While most hospitals have focused on promoting quality care at their facilities to help decrease costs, quality care will take on a somewhat different meaning under the new healthcare reform law: Hospitals will feel the pressure to maintain continuous quality improvement or risk being penalized under reform incentives scheduled over the next several years, according to a PricewaterhouseCoopers’ Health Research Institute report titled “Health Reform: Prospering in a Post-Reform World.”

According to the report, the new law can be expected to impact hospitals in three main areas:

• Hospital readmissions. Starting in October 2012, hospitals will be financially penalized by Medicare if they demonstrate “excess” readmissions within a 30-day period when compared to the “expected” risk-adjusted levels of readmissions. The readmissions are based on the measures for acute myocardial infarction, heart failure, and pneumonia.
• Hospital payments based on value based purchasing (VBP). Starting in 2013, hospitals will be paid according to a Medicare VBP program schedule, in which payments will be made based on hospitals’ quality measure outcomes. VBP will measure hospital efficiency, patient satisfaction, and quality of care. These outcomes will be collected beginning October 2012.
• Penalties for hospital acquired conditions (HACs). Beginning in 2015, 1% of payments will be subtracted from hospitals with the highest rates of HACs—essentially those falling into the bottom quartile of hospitals when compared to the national average. This could result in a nationwide reduction of $1.5 billion in payments over the next 10 years………………….”

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