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Hospital Value Based Purchasing Program

July 25, 2014

This is the third of a series of articles on how CDI Programs can contribute to their organization's success under CMS P4P metrics.


The Hospital Value Based Purchasing (HVBP) Program

In fiscal year (FY) 2013, Medicare began withholding 1% of all hospital DRG payments to fund an HVBP “incentive pool”.  The withheld amount increases progressively until it reaches 2% in FY2017.  High achieving hospitals are rewarded with incentive payments based on their performance ranking compared with other hospitals or if they substantially improve their performance. 


CMS estimates that about 50% of hospitals will see a net increase in revenue and 50% a net decrease.   Payments in FY2015 will be based on performance during certain periods between October 1, 2012 and December 31, 2013 depending on the measure.


HVBP Program Measures

Beginning October 1, 2014, there will be four HVBP components, or domains, that include specific measures which account for a certain percentage of the incentive. All will be reported on the CMS Hospital Compare website. The four domains are:

  1. Clinical process of care selected from pre-existing core measures (12 measures - 20%)
  2. Risk (Severity)-Adjusted Outcome (5 measures - 30%):
    • 30-day all-cause mortality following acute MI, heart failure, and pneumonia
    • Central line-associated blood stream infection (CLABSI)
    • Patient Safety Indicator #90 Composite (see CDI+ E-news June issue)
  3. Patient Experience of Care from the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) national survey (8 measures - 30%)
  4. Cost efficiency: Medicare spending per beneficiary (1 measure - 20%)


Your CDI Program and HVBP

CDI Programs are uniquely positioned to measure, monitor and improve the quality of medical record documentation and resulting ICD-9-CM code assignment.  Risk adjustment of the HVBP outcome and mortality measures means that severity of illness based on the number and nature of certain co-morbid conditions (not limited to APR-DRG severity) coded on the inpatient claim greatly influences the hospital’s quality performance and revenue. 


HVBP claims based outcome measures are risk adjusted; this means that organization performance is impacted with improved capture of impactful comorbid conditions.  Some examples include diabetic manifestations/complications, weight loss, chronic kidney disease, certain deficiency anemias, correct POA status to name a few.


HCQ Consulting Can Help

We at HCQ Consulting can provide your CDI program with assessment, education and process development to incorporate pay for performance measures into your program.  Please contact us for more information.

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