hospital value-based purchasing

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HOSPITAL VALUE-BASED PURCHASING

ICN MLN907664 June 2020

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MLN BookletHospital Value-Based Purchasing

ICN MLN907664 June 2020 of 14

TABLE OF CONTENTSUpdates ................................................................................................................................................ 3

Introduction .......................................................................................................................................... 4

How Does Hospital VBP Work? ......................................................................................................... 4

How Does the VBP Program Measure Hospital Performance? ....................................................... 4

How Is Hospital Performance Scored? ............................................................................................. 7

What Are the Hospital VBP Program Performance Periods? .........................................................11

When Are the Hospital VBP Payment Adjustments Made? ........................................................... 13

How Is the Hospital VBP Program Funded? ................................................................................... 13

Key Takeaways .................................................................................................................................. 13

Resources .......................................................................................................................................... 14



UPDATES

Note: We revised this product with the following content updates:

● Added information on relief for clinicians, providers, hospitals, and facilities participating in quality reporting and value-based purchasing programs due to the COVID-19 public health emergency

● Added Hospital VBP domains and relative weights for FYs 2018–2023 ● Revised Hospital VBP measures for FYs 2021–2023 ● Revised baseline and performance periods for FYs 2021–2023



INTRODUCTIONThe CMS Hospital Value-Based Purchasing (VBP) Program rewards acute-care hospitals with incentive payments for quality care to Medicare patients.

SSA Section 1886(o) established the Hospital VBP Program, affecting payment for inpatient stays in about 3,000 hospitals across the country. This program is part of CMS’ new Meaningful Measures initiative to improve outcomes for patients, their families, and providers while reducing burden on clinicians and providers.

This booklet explains how the Hospital VBP Program works and how we measure and score hospital performance. It also lays out changes to future Hospital VBP Program years.

HOW DOES HOSPITAL VBP WORK?Medicare pays hospitals for inpatient acute care services based on the quality of care (evaluated using a select set of quality and cost measures), not just the quantity of the services they provide. Under the Hospital VBP Program, Medicare makes incentive payments to hospitals based on either:

● How well they perform on each measure compared to other hospitals’ performance during a baseline period

● How much they improve their performance on each measure compared to their performance during a baseline period

Report performance information through the QualityNet Hospital Quality Reporting (HQR) Portal. The HQR is the secure extranet portal supporting Center for Clinical Standards and Quality (CCSQ) reporting programs for health care providers and their supporting vendors.

HOW DOES THE VBP PROGRAM MEASURE HOSPITAL PERFORMANCE?CMS bases hospital performance on an approved set of measures and dimensions grouped into specific quality domains. CMS assigns domain weights (percentages) which are then used to score each domain.

Table 1. Hospital VBP Domains & Relative Weights

Domain Weight

Safety 25%Clinical Outcomes 25%Efficiency and Cost Reduction 25%Person and Community Engagement 25%

https://www.ssa.gov/OP_Home/ssact/title18/1886.htm

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy

https://hqr.cms.gov/hqrng/login



Table 2. FY 2021 Hospital VBP Program Measures

Measure ID Measure Description Domain

CAUTI Catheter-Associated Urinary Tract Infection SafetyCLABSI Central Line-Associated Blood Stream Infection SafetyCDI Clostridium difficile Infection (C. difficile) SafetyMRSA Methicillin-Resistant Staphylococcus aureus Bacteremia SafetySSI Surgical Site Infection:

● Colon ● Abdominal Hysterectomy

Safety

MORT-30-AMI Acute Myocardial Infarction (AMI) 30-Day Mortality Rate Clinical OutcomesMORT-30-COPD Chronic Obstructive Pulmonary Disease (COPD) 30-Day

Mortality RateClinical Outcomes

MORT-30-HF Heart Failure (HF) 30-Day Mortality Rate Clinical OutcomesMORT-30-PN Pneumonia (PN) 30-Day Mortality Rate Clinical OutcomesCOMP-HIP-KNEE Total Hip Arthroplasty (THA) and/or Total Knee

Arthroplasty (TKA) Complication RateClinical Outcomes

MSPB Medicare Spending per Beneficiary (MSPB) Efficiency and Cost Reduction

Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey

● Communication with Nurses ● Communication with Doctors ● Responsiveness of Hospital Staff ● Communication about Medicines ● Hospital Cleanliness and Quietness ● Discharge Information ● Care Transition ● Overall Rating of Hospital

Person and Community Engagement






● Colon ● Abdominal Hysterectomy

Safety

MORT-30-AMI Acute Myocardial Infarction (AMI) 30-Day Mortality Rate Clinical OutcomesMORT-30-CABG Coronary Artery Bypass Grafting (CABG) 30-Day


MORT-30-COPD Chronic Obstructive Pulmonary Disease (COPD) 30-Day Mortality Rate

Clinical Outcomes




HCAHPS Survey ● Communication with Nurses ● Communication with Doctors ● Responsiveness of Hospital Staff ● Communication about Medicines ● Hospital Cleanliness and Quietness ● Discharge Information ● Care Transition ● Overall Rating of Hospital







● Colon● Abdominal Hysterectomy

Safety

CMS PSI 90 Patient Safety and Adverse Events Composite SafetyMORT-30-AMI Acute Myocardial Infarction (AMI) 30-Day Mortality Rate Clinical OutcomesMORT-30-CABG Coronary Artery Bypass Grafting (CABG) 30-Day


MORT-30-COPD Chronic Obstructive Pulmonary Disease (COPD) 30-Day Mortality Rate

Clinical Outcomes




HCAHPS Survey ● Communication with Nurses● Communication with Doctors● Responsiveness of Hospital Staff● Communication about Medicines● Hospital Cleanliness and Quietness● Discharge Information● Care Transition● Overall Rating of Hospital


HOW IS HOSPITAL PERFORMANCE SCORED?CMS assesses each hospital’s total performance by comparing its Achievement and Improvement scores for each applicable Hospital VBP measure. CMS uses a threshold and benchmark to determine how many points to award for the Achievement and Improvement scores. CMS compares the Achievement and Improvement scores and uses whichever is greater.



● Benchmark: Average (mean) performance of the top 10% of hospitals during the baseline period

Figure 1: Benchmark

Hospital

Data

Achievement Threshold

90%

Benchmark

● Achievement Threshold: Performance at the 50th percentile (median) of hospitals during thebaseline period

Figure 2: Achievement Threshold

Low Score

High Score

50th Percentile

To determine the domain scores, CMS adds points across all measures.



● Achievement points are awarded by comparing an individual hospital’s rates during theperformance period to all hospitals’ rates from the baseline period:● Hospital rates at or better than the benchmark = 10 Achievement points● Hospital rates worse than the Achievement threshold = 0 Achievement points● Hospital’s rate is equal to or better than the Achievement threshold but worse than the

benchmark = 1–9 Achievement points

Figure 3: Achievement Points

All Hospitals

Your Hospital

Time

● Improvement points are awarded by comparing an individual hospital’s rates during theperformance period to its rates from the baseline period:● Hospital rates at or better than the benchmark = 9 Improvement points● Hospital rates at or worse than baseline period rate = 0 Improvement points● Hospital’s rate is better than its baseline period score but worse than the benchmark = 0–9

Improvement points



Figure 4: Improvement Points

Your Hospital Your Hospital

Time

The Person and Community Engagement domain score is the sum of a hospital’s HCAHPS base score and its HCAHPS Consistency score.

● Consistency points are awarded by comparing an individual hospital’s HCAHPS Survey dimensionrates during the performance period to all hospitals’ HCAHPS Survey rates from a baseline period:● If a hospital’s performance on all HCAHPS dimensions is at or better than the Achievement

threshold = 20 Consistency points● If any HCAHPS dimension rate is at or worse than the worst-performing hospital’s performance

(floor) on that dimension during the baseline period = 0 Consistency points● If the lowest HCAHPS dimension score is better than the worst-performing hospital’s rate but

worse than the Achievement threshold = 0–20 Consistency points

CMS calculates a hospital’s Total Performance Score (TPS) by:

1. Selecting the greater of either the hospital’s Achievement or Improvement points for each measureto help determine a score for each domain

2. Multiplying each domain score by a specified weight (percentage)3. Adding the weighted domain scores

CMS allows hospitals with enough data in at least 3 out of the 4 domain scores to get a TPS. Hospitals that only have scores in 3 domains will have their scores proportionally reweighted.



For in-depth explanation and examples of the scoring method, review the What’s My Payment? Understanding the Hospital VBP Program Calculations Step-By-Step in the Percentage Payment Summary Report webinar recording or slides.

Each hospital’s measure scores, domain scores, and TPS are available on the Hospital Compare website.

WHAT ARE THE HOSPITAL VBP PROGRAM PERFORMANCE PERIODS?A Hospital VBP Program performance period is a time span of data that shows how well a hospital is performing. CMS compares data from each participating hospital during the performance period to that hospital’s data during a baseline period to determine the Improvement score. The participating hospitals’ performance period data is compared to the Achievement Threshold for all hospitals during the baseline period to determine the Achievement score.

Table 5. FY 2021 Baseline & Performance Periods

Domain Baseline Period Performance Period

Safety: CLABSI, CAUTI, SSI, MRSA, CDI

Jan. 1, 2017–Dec. 31, 2017 Jan. 1, 2019–Dec. 31, 2019

Clinical Outcomes: MORT-30-AMI, MORT-30-COPD, MORT-30-HF

July 1, 2011–June 30, 2014 July 1, 2016–June 30, 2019

Clinical Outcomes: MORT-30-PN

July 1, 2012–June 30, 2015 Sep. 1, 2017–June 30, 2019

Clinical Outcomes: COMP-HIP-KNEE

April 1, 2011–March 31, 2014 April 1, 2016–March 31, 2019

Efficiency and Cost Reduction Jan. 1, 2017–Dec. 31, 2017 Jan. 1, 2019–Dec. 31, 2019Person and Community Engagement

Jan. 1, 2017–Dec. 31, 2017 Jan. 1, 2019–Dec. 31, 2019

https://www.qualityreportingcenter.com/en/inpatient-quality-reporting-programs/hospital-inpatient-quality-reporting-iqr-program/2019-events/vbp080720192



https://www.medicare.gov/care-compare/?providerType=Hospital&redirect=true

https://www.medicare.gov/care-compare/?providerType=Hospital&redirect=true





Safety: CLABSI, CAUTI, SSI, MRSA, CDI

Jan. 1, 2018–Dec. 31, 2018 Jan. 1, 2020–Dec. 31, 2020

Clinical Outcomes: MORT-30-AMI, MORT-30-CABG, MORT-30-COPD, MORT-30-HF


Clinical Outcomes: MORT-30-PN

July 1, 2012–June 30, 2015 Sep. 1, 2017–June 30, 2020




Jan. 1, 2018–Dec. 31, 2018 Jan. 1, 2020–Dec. 31, 2020



Safety: CAUTI, CLABSI, SSI, CDI, MRSA

Jan. 1, 2019–Dec. 31, 2019 Jan. 1, 2021–Dec. 31, 2021

Safety: CMS PSI 90 Oct. 1, 2015–June 30, 2017 July 1, 2019–June 30, 2021Clinical Outcomes: MORT-30-AMI, MORT-30-HF, MORT-30-COPD, MORT-30-CABG, MORT-30-PN





Jan. 1, 2019–Dec. 31, 2019 Jan. 1, 2021–Dec. 31, 2021

QualityNet has Program Year Quick Reference Guides available which include the domain, measures, baseline and performance periods, threshold and benchmark rates, and payment adjustment effective dates for each FY on 1 page.

https://qualitynet.cms.gov/inpatient/hvbp/resources



NOTE: On March 22, 2020, CMS announced relief for clinicians, providers, hospitals, and facilities participating in quality reporting and value-based purchasing programs due to the COVID-19 public health emergency (PHE). For the Hospital VBP Program, qualifying claims are excluded from the measure calculations for January 1, 2020–March 31, 2020 (Q1 2020), and April 1, 2020–June 30, 2020 (Q2 2020), from the mortality measures, complication measure, MSPB measure, and CMS PSI 90 measure. Also, submitting the HCAHPS survey and Healthcare-Associated Infection (HAI) data is optional for October 1, 2019–December 31, 2019 (Q4 2019), January 1, 2020–March 31, 2020 (Q1 2020), and April 1, 2020–June 30, 2020 (Q2 2020). For more information on the Hospital VBP ECE policy and for updates on COVID-19-related ECEs, refer to the Participation page of QualityNet.

WHEN ARE THE HOSPITAL VBP PAYMENT ADJUSTMENTS MADE?Hospital VBP payment adjustments are applied to the base operating Medicare Severity Diagnosis-Related Group (MS-DRG) payment amount for each discharge occurring in the applicable FY on a per-claim basis. For example, the FY 2021 TPS adjusts payments for discharges in FY 2021 (October 1, 2020–September 30, 2021).

HOW IS THE HOSPITAL VBP PROGRAM FUNDED?The Hospital VBP Program is funded by reducing hospitals’ base operating MS-DRG payments by 2.0%. Hospitals get funds redistributed based on their TPS.

Other program funding specifics are as follows:

● The law requires that the total amount of aggregate value-based incentive payments equals theamount available for value-based incentive payments.

● CMS finalized a linear exchange function to translate TPSs into value-based incentive payments.

KEY TAKEAWAYS● The Hospital VBP Program rewards acute care hospitals for their quality of care to Medicare

patients, rather than the quantity of care.● Under the VBP Program, Medicare makes incentive payments to hospitals based on how well they

perform on measures compared to other hospitals’ performance or how much they improved theirperformance on measures compared to their own performance during a baseline period.

● CMS scores hospitals by comparing its Achievement and Improvement scores for each applicableVBP measure.

● Clinicians, providers, hospitals, and facilities participating in quality reporting and VBP programscan get reporting relief due to the COVID-19 PHE under the extraordinary circumstances exception.

https://qualitynet.cms.gov/inpatient/iqr/participation#tab3



RESOURCES ● HCAHPS ● Hospital Inpatient Prospective Payment System 2021 Final Rule ● Hospital Quality Initiative ● Hospital VBP Program ● Meaningful Measures Framework

Medicare Learning Network® Content Disclaimer, Product Disclaimer, and Department of Health & Human Services Disclosure

The Medicare Learning Network®, MLN Connects®, and MLN Matters® are registered trademarks of the U.S. Department of Health & Human Services (HHS).

https://hcahpsonline.org

https://www.federalregister.gov/d/2020-19637

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/HVBP/Hospital-Value-Based-Purchasing

https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/CMS-Quality-Strategy

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