A closer look at CMS quality initiatives

On May 5, 2011, CMS published the 2012 Proposed Hospital IPPS Rule [76 Fed Reg 25788]. If you want to understand the nuts and bolts of quality, P4P and VBP initiatives in Medicare, you need to read this rule.  297 pages of triple-column joy. For opponents of administered pricing, this is looking into the belly of the beast. For supporters, this is how CMS communicates with hospital CFOs and billing offices on quality issues.

Payment Reductions for Hospital-Acquired Conditions (HACs)

  • HACs now include acute kidney failure, unspecified (ICD-9-CM 584.9) combined with one or more procedural codes that indicate that imaging contrast was used (ICD-9-PCS 87.71-.75, 88.40-.67).  The theory is that all such kidney failures after imaging with contrast are avoidable and therefore Medicare won’t pay for the incremental costs. Estimated savings are over $100 million per year, but I have been troubled by the causal leaps in all HAC payment rules, as if all of the listed “hospital-associated” conditions are actually “hospital-acquired.”
  • Surgical site infections following certain bariatric procedures (539.01 and 539.81) are also deemed HACs, as are additional categories of hospital falls, but remember that not all falls are preventable and ethical rules prevent over-use of patient restraints.
  • CMS won’t pay the incremental costs of the HAC (ie. the co-morbidity or severity modifiers).  This is a micro approach, modifying the payment on very specific bills.

Inpatient Quality Reporting (IQR) program:

  • Good empirical evidence supports a checklist approach to central line insertion practices and catheter maintenance to reduce UT infections.  Starting in FY 2014, hospitals will report this data and CMS may post it on its website.
  • Also starting in FY 2014:  reporting Medicare spending per beneficiary and participation in systemic clinical database registries for general surgery. Excellent ideas.
  • For FY 2015, additional healthcare-associated infection (HAI) reporting will include:
    • MRSA bacteremia (central line infections)
    • Clostridium difficile (strongly associated with prior antibiotic use)
    • Healthcare personnel influenza vaccination (it is amazing hard to cajole US health care workers to get vaccinated)
  • From the department of unintended consequences, CMS now agrees that one of the previous IQR measures resulted in inappropriate antibiotic use (PN-5c, Timing of receipt of initial antibiotic following hospital arrival).  This is a gratifying change for those who care about appropriate use of antibiotics, but also a cautionary tale in top-down rulemaking.

Value-Based Purchasing

  • If the HAC rule is micro, VBP is macro, awarding bonuses to hospitals for both achievement and improvement in HACs and IQRs.  CMS now proposes to add a third domain to VBP (efficiency) using the newly proposed Medicare spending per beneficiary IQR. Bonuses for being efficient, low-cost providers = paying hospitals to bend the cost curve.
  • The Hospital Readmission Reduction payment penalty will begin in FY 2013, as required under ACA.  CMS will use three current readmission datasets from IQR for AMI, CHF and pneumonia, with a 30-day readmission window.

Comments are open with CMS until June 20, 2011 – and you can be sure that interested parties (hospitals & medical specialty societies) will weigh in with both politics and peer-reviewed evidence.

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