Hospital Value Based Purchasing & Dual-Eligibles Demonstrations

CMS today released the final rules on hospital value-based purchasing (VBP) for Medicare FFS.  While they are not as rigorous as originally proposed, these rules represent a sea of change for the industry.  Beginning in 2013, hospital reimbursement will be cut universally by 1 percent, then decreased gradually to a total reduction of 2 percent to fully fund the program by 2017.  The program will evaluate hospitals on clinical processes and patient experience of care.  Hospitals that perform well or improve year over year would receive a quality bonus payment.

Healthcare Reform Updates

MA Star bonuses

We recently told you that CMS was administratively overriding the healthcare reform act by making quality bonuses available to Medicare Advantage plans that are rated at 3 (average) in the Star quality assessment. Health reform called for rewards for only 4 and 5 Star plans. The problem:  few would have qualified, which would have impacted seniors by reducing the revenue that would go toward added benefits and that also would have reduced cost-sharing for a majority in the program.

All Aboard–The Health Care Savings Train is Leaving the Station

Finally, policy-makers seem to be getting serious about the size of government and America’s ever-growing debt.  A main focus is the rising cost of healthcare, a sector that is quickly spiraling out of control toward one-fifth of the Gross Domestic Product (GDP).  The recent attention to this matter has been a long-time coming. While one can argue the alarm bells should have sounded years ago, we’re glad that both sides are finally focused on curbing the growth of healthcare spending, even if they have different approaches.

“Insuring” Health Reform’s Solvency – Are There Alternatives to the Individual Mandate?

The Supreme Court is primed to consider whether it will expedite its review of the many lawsuits challenging constitutionality of the Patient Protection and Affordable Care Act (PPACA). And with the court leaning conservative, many are betting that at least the individual mandate will be struck down.

If that happens, what’s next for health reform?

Accountable Care Organization Rules Come Out – Part II

Yesterday, we analyzed the cost-effectiveness and shared savings of ACOs as defined by CMS’ proposed rules governing their establishment. Today, we will look at the quality standards included in the regulations.

CMS is taking a very aggressive approach on quality standards for ACOs. Even if an organization achieves cost-savings, over time no payment will be made unless quality metrics are met.

The rules establish quality performance measures and a methodology for linking them with financial performance. They also require the ACO to have in place procedures and processes to promote evidence-based medicine and beneficiary engagement.

Accountable Care Organization Rules Come Out – Part I

Over the past several months, we have felt a little like the kids in the back seat of the car asking, “are we there yet?” Finally, we are.

On March 31, 2011, CMS issued its long-awaited proposed rules governing the establishment of Accountable Care Organizations (ACOs) as directed by the Patient Protection and Affordable Care Act (PPACA).

CMS indicated that ACOs are an opportunity for Medicare beneficiaries to receive high-quality, evidence-based healthcare that eliminates waste and reduces excessive costs through improved care delivery. Public comments will be accepted through June 6, 2011.