value-based purchasing & payment reform how will it … · value-based purchasing & payment...

Value-Based Purchasing & Payment Reform –

How Will It Affect You?

HFAP Webinar September 21, 2012

Nell Buhlman, MBA

VP, Product Strategy

Click to view recording.

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Payment Reform Landscape

Current & future

Hospital exposure under payment reform

Value-based Purchasing

How are hospitals doing?

Strategies for Success Under Payment Reform

Taking an integrated approach

The methodology is your friend (really)

Using the methodology to prioritize improvement opportunities

© 2012 Press Ganey Associates, Inc.

Agenda

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The Impact and Challenge of Ever-Increasing Initiatives

2010 2011 2012 2013 2014 2015 2016 2017

Readmissions

Hospital Acquired Conditions

Meaningful Use

Value-based Purchasing (VBP)

Inpatient Quality Reporting Requirement (IQR, formerly RHQDAPU)

Hospital Acquired Conditions (HAC)

VBP VBP

Meaningful Use

2% of APU

2%

1%

1%

3%

Medicare Payment at Risk Under CMS Quality-based Payment Reform Initiatives

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Fluid scope

Expanding area of interest

Removal of topped-out measures

Shared measures

Limited pool from which to draw

Double jeopardy for poor performers

Thresholds and benchmarks set extremely high

Rising over time as performance improves across the board

© 2012 Press Ganey Associates, Inc.

Challenges Common to all the Reform Initiatives

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Inpatient Quality Reporting Initiative (IQR)

Incentive / Penalty 2% of Annual Payment Update (Pay for Reporting)

Measurement Areas of

Interest

Clinical Chart-abstracted

Measures (“Core Measures”)

AMI

Heart Failure

Pneumonia

Surgery

ED

Immunizations

VTE

Stroke

Patient Experience HCAHPS

Structural Measures Registry participation

Claims-based Measures

Mortality

Readmissions

AHRQ composite measures

Considerations List of included measures changes from year to year.

Data must be on time, complete and accurate to avoid penalty.

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Value-based Purchasing (VBP)

Incentive / Penalty 1% of Base DRG operating payment in FY13, rising to 2% in FY17

Measurement Areas

of Interest

FFY 2013

Core Measures

Patient Experience

AMI, HF, PN, SCIP

HCAHPS

FFY 2014

Core Measures

HCAHPS

Outcomes

(Largely unchanged)

(Unchanged)

30d risk- adjusted mortality AMI, HF, PN

FFY 2015

(proposed)

Core Measures

Patient Experience

Outcomes

Efficiency of Care

(Largely unchanged)

(Unchanged)

Adding AHRQ PSI composite and CLABSI

Average spending per M/care Beneficiary

FFY 2016

(proposed)

Clinical Care

Person & Caregiver Experience & Outcomes

Safety

Efficiency & Cost Reduction

Care Coordination

Community/Population Health

Considerations

Domain weighting for score calculation changes as new domains added

Measures within domains subject to change (additions, deletions)

Proposal for FY16 is a realignment of all measures

7 © 2012 Press Ganey Associates, Inc.

HCAHPS in VBP: Relatively Greater Going Forward

Core

Measures

70%

HCAHPS

30%

Core

Measures

45%

HCAHPS

30% Outcomes

25%

Efficiency

20%

Core

Measures

20%

Outcomes

30%

HCAHPS

30%

2013

2014

2015

8 © 2012 Press Ganey Associates, Inc.

Readmissions Reduction Initiative

Incentive / Penalty Capped at 1% of base DRG operating payment in FFY 2013, 2% in FFY

2014, and 3% in FFY 2015

Measurement

Areas of Interest

FFY 2013 Excess readmissions for AMI, HF, PN

FFY 2015

Adding Chronic Obstructive Pulmonary Disorder

Several cardiac and vascular surgical procedures

“Other conditions or procedures the Secretary chooses”

Considerations

Future measures require exclusions for certain types of readmissions (e.g.,

readmissions unrelated to original admission), but current measures are all

cause

CMS will compare observed rates to expected rates to determine:

1) number of excess readmissions and 2) excess payments associated with

excess readmissions. Regardless of amount of excess payments

associated with excess readmissions, penalty cannot exceed the stated

cap for the FFY.

9 © 2012 Press Ganey Associates, Inc.

Focus: Excess costs associated with excess readmission

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Hospital Acquired Conditions

Incentive/Penalty

Currently: Non-payment for specified HACs

FFY 2015: 1% reduction of base DRG operating payment for hospitals in the

top quartile of HAC occurrence

Measurement

Areas of Interest

Foreign Object Retained After Surgery

Air Embolism

Blood Incompatibility

Stage III and IV Pressure Ulcers

Falls and Trauma

Manifestations of Poor Glycemic Control

Catheter-Associated Urinary Tract Infection

Vascular Catheter-Associated Infection

Surgical Site Infection Following specified surgical procedures

Deep Vein Thrombosis (DVT)/Pulmonary Embolism (PE) following certain

orthopedic procedures

Considerations

List of conditions likely to change (additions and deletions)

Composite score calculation (weighting) not yet determined

There is always a top quartile!

© 2012 Press Ganey Associates, Inc.

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Meaningful Use

Incentive / Penalty Currently: Incentive payments and grants available for early adopters

FFY 2015: Initially a portion of APU at risk, eventually entire APU at risk

Measurement

Areas of Interest

Established by HITECH provision of ARRA, requires hospitals to use certified

EHR technology:

In a meaningful manner (e.g., e-prescribing)

For electronic exchange of health information to improve quality of care

To submit clinical quality measures and other such data as required by the

Secretary

Three stages of criteria. Progressively complex/stringent

Considerations Increasing number of quality measures over time.

EHRs can be certified as “full EHRs” with providing all the necessary data

elements for quality measures submission

12 © 2012 Press Ganey Associates, Inc.

Example of Potential Hospital Impact

Dollars subject to Medicare P4P programs at a

146-bed hospital in Florida

% $ % $ % $ % $ % $

VBP 1 $ 210,054 1.25 $ 262,568 1.5 $ 315,081 1.75 $ 367,595 2 $ 420,108

Readmits 1 $ 210,054 2 $ 420,108 3 $ 630,162 3 $ 630,162 3 $ 630,162

HAC 1 $ 210,054 1 $ 210,054 1 $ 210,054

MU 1 $ 210,054 1 $ 210,054 1 $ 210,054

Sum 2 $ 420,108 3.25 $ 682,676 6.5 $ 1,365,351 6.75 $ 1,417,865 7 $ 1,470,378

5yr Total $ 5,356,377

FFY13 FFY14 FFY15 FFY16 FFY17

Using MedPar 2010 data

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Example of Potential Hospital Impact

Dollars subject to Medicare P4P programs

at a 550-bed hospital in Kansas

Using MedPar 2010 data

% $ % $ % $ % $ % $

VBP 1 $ 668,940 1.25 $ 836,175 1.5 $ 1,003,410 1.75 $ 1,170,645 2 $ 1,337,880

Readmits 1 $ 668,940 2 $ 1,337,880 3 $ 2,006,820 3 $ 2,006,820 3 $ 2,006,820

HAC 1 $ 668,940 1 $ 668,940 1 $ 668,940

MU 1 $ 668,940 1 $ 668,940 1 $ 668,940

Sum 2 $1,337,880 3.25 $ 2,174,055 6.5 $ 4,348,110 6.75 $ 4,515,345 7 $ 4,682,580

5yr Total $ 17,057,970

FFY13 FFY14 FFY15 FFY16 FFY17

VBP: How are Hospitals Doing?

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VBP – National Baseline Performance FFY13

55 30

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VBP – Change since Baseline FFY13

69 48

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Distribution of Predicted Overall 2013 VBP Scores

56 74

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Communication with Doctors: Change in Performance since Baseline

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Communication with Nurses: Change in Performance since Baseline

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Responsiveness: Change in Performance Since Baseline

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VBP – Baseline Performance FFY14

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Average score

decreases by 15

points. (Ugh.)

Success Under Payment Reform:

Take an Integrated Approach

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“Separate but Related”

HAC IQR

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Ample published evidence that improvement in metrics subject to P4P offer benefits that cut across multiple P4P initiatives

Higher overall patient satisfaction associated with lower 30-day hospital readmission rates (AMI, HF, PN).

Higher percentage of patients responding “Always” to discharge instructions question associated with lower readmission rates

High Likelihood to Recommend and Overall Rating associated with fewer decubiti and nosocomial infections

Better performance on HQA measures correlated with lower risk-adjusted 30 mortality on same conditions

Higher patient satisfaction associated with adherence to standards of care and lower inpatient mortality

Higher scores on perception of cleanliness, blood-draw skills, and nurse responsiveness associated with lower infection rates and infection mortality.

© 2012 Press Ganey Associates, Inc.

“Separate but Related”

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Example: Readmission in the context of HCAHPS performance (by facility)

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Example: Readmission in the context of HCAHPS performance (by group)

Addressing Quality-based

Payment Reform (In Four Easy Steps)

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1.

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2. Stakeholder Awareness and Involvement

Quality

Leadership

Opportunity-

specific

Stakeholders

Process Drivers

Executive

Leadership

Clinical

Leadership

Board

Who What they need

to know and do

Methodology. Data analysis and

drill down. Identify potential

opportunities for improvement.

Compliance with standards.

Shape the culture. Set the tone.

Evaluate opportunities for

improvement. Strategy-setting.

Degree of exposure. Overall

scores. Progress to goals.

Drive change.

© 2012 Press Ganey Associates, Inc.

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Financial Analysis

Estimate exposure: total incentive (“Withhold”)

Incentive earned/lost given current performance

Gap Analysis

Identify aspects of performance driving the greatest losses

Determine incremental improvement necessary to drive additional points/

payments

Opportunity Analysis

Look for aspects of performance affecting multiple P4P initiatives

Look for measures that move in tandem and “Rising tide” measures

What does drill-down show?

What’s the effort required to improve?

Who needs to be involved?

3. Use the Methodology to Prioritize Opportunities

© 2012 Press Ganey Associates, Inc.

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Scenario Planning

Create improvement scenarios with prioritized opportunities

Realistic, Achievable goals (base, target, stretch)

Identify and evaluate scenarios providing maximum yield

© 2012 Press Ganey Associates, Inc.

3. Use the Methodology to Prioritize Opportunities

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Things to consider

Relative weight of metrics and effort required to improve

In VBP, measures can drive identical incentive losses

Sample size: small number of “misses” can drive big losses

A HAC is not a HAC is not a HAC

Rising Targets: rate improvement needs to outpace aggregate improvement

Rising VBP thresholds

Hard to get out of the HAC penalty box

Role of stakeholders:

Change takes place at the “person level”

Readmissions, Mortality sensitive to practice at post-acute providers

Physician engagement, Patient engagement, Coordination of care…

3. Use the Methodology to Prioritize Opportunities

© 2012 Press Ganey Associates, Inc.

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Not all opportunities are created equal

© 2012 Press Ganey Associates, Inc.

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Effect of Rising Targets

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Effect of Rising Targets

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“Rising Tide” measure: Nurse Communication

This cluster of measures makes up 15% of a hospital’s VBP score

© 2012 Press Ganey Associates, Inc.

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Identify and Emulate Best Practices for Top Improvement Opportunities

Concurrent management of core measures patients

Hourly Rounding

Physician Engagement

Collaboration with post-acute providers

4. Best Practices

© 2012 Press Ganey Associates, Inc.

Make the case for change with evidence-based WIIFM

Demonstrate how the best-practices are aligned with professional goals and personal interests of the individual

whose practice, processes or behavior you are trying to change

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Make the case

Yes=4723 No=1950

Hourly Rounding Impact on Top Box %

© 2012 Press Ganey Associates, Inc.

A Practical Example

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Misses on 11 patients,

Loses $102,493

Clinical Performance

Misses on 7 patients,

Loses $102,493

Misses on 4 patients,

Loses $102,493 Misses on 4 patients,

Loses $71,745

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Satisfaction Performance

What you don’t see: 19% of

patients responded Usually

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Gap & Opportunity Analysis

© 2012 Press Ganey Associates, Inc.

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1. Understanding

Financial impact

Performance: where we are, where need to be

Methodologies: now and next

2. Take an integrated approach

Seven flies with one blow

3. Real change happens at the person-level

Facilitate consistency

Make the case (WIIFM)

Concluding Thoughts

© 2012 Press Ganey Associates, Inc.

Success under Payment Reform: