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Medicare fines for high hospital readmissions drop, but nearly 2,300 facilities are still penalized
resulting in the lightest penalties since 2014.
The Hospital Readmissions Reduction Program has been a mainstay of Medicare’s hospital payment system since it began in 2012. Created by the Affordable Care Act, the program evaluates the frequency with which Medicare patients at most hospitals return within 30 days and lowers future payments to hospitals that had a greater-than-expected rate of return. Hospitals can lose up to 3% of each Medicare payment for a year.
The pandemic threw hospitals into turmoil, inundating them with COVID patients while forcing many to postpone elective surgeries for months. When the Centers for Medicare & Medicaid Services evaluated hospitals’ previous 3 years of readmissions, as it does annually, the government decided to exclude the first half of 2020 because of the chaos caused by the pandemic. CMS also excluded from its calculations Medicare patients who were readmitted with pneumonia across all three years because of the difficulty in distinguishing them from patients with COVID.
Akin Demehin, senior director of quality and patient safety policy at the American Hospital Association, said the changes were warranted. “The COVID pandemic did a lot of really unprecedented things to care patterns of hospitals,” he said.
After making those changes, CMS evaluated 2½ years of readmission cases for Medicare patients who’d had heart failure, heart attacks, chronic obstructive pulmonary disease, coronary artery bypass grafts, and knee and hip replacements. As a result of its analysis, CMS penalized 2,273 hospitals, the fewest since the fiscal year that ended in September 2014, a KHN analysis found.
The average payment reduction was 0.43%, also the lowest since 2014. The reductions will be applied to each Medicare payment to the affected hospitals from Oct. 1 to next September and cost them $320 million over that 12-month period.
Some hospitals will see their penalties greatly reduced from 2021. The penalty on St. Mary’s Hospital in Athens, Ga., is dropping from 2.54% to 0.06%. Saint Joseph East in Lexington, Ky., received the maximum penalty, 3%, in 2021; it will lose 0.78% as of Oct. 1. In Flemington, N.J., the penalty for Hunterdon Medical Center is dropping from 2.29% to 0.12%.
To limit penalties, many hospitals in recent years have instituted new strategies to keep former patients from needing a return visit. Robert Coates, MD, interim chief medical officer at Hunterdon Health, which owns Hunterdon Medical Center, said in a statement that the hospital set up a system to identify patients who visited the emergency room within 30 days of a hospital stay. Instead of readmitting them, Hunterdon helps them set up next-day appointments at a doctor’s office or home monitoring of their health. Hunterdon also calls all discharged patients to ensure they have filled their prescriptions and had a follow-up visit with a clinician within a week of leaving the hospital.
Jessica Satterfield, MD, director of quality and clinical excellence at St. Mary’s Health Care System, which operates St. Mary’s Hospital, said in a statement that the hospital identified patients at risk of readmission when they were first admitted and focused on making sure that their medications were correct and that they had follow-up visits. “We are proud that our efforts are bearing fruit in the form of greatly reduced penalties but, more importantly, as a reflection of the exceptional care our staff and medical staff provide to our patients,” Dr. Satterfield said.
Saint Joseph East did not respond to emails seeking comment.
Despite the changes, 43% of the nation’s 5,236 hospitals were penalized. Of the unpenalized, all but 770 were automatically exempted. The 2,193 exempted hospitals include those that specialize in children, psychiatric patients, or veterans. Rehabilitation and long-term care hospitals are also excluded from the program, as are critical access hospitals, which Medicare pays differently to help them stay open in areas with no other hospitals. The government also exempted Maryland hospitals because that state has a special payment arrangement with Medicare. Of the hospitals that Medicare assessed, 75% were penalized.
For the new fiscal year, Medicare also cited the pandemic in giving hospitals a reprieve from its other major quality-focused effort that assesses penalties: the Hospital-Acquired Condition Reduction Program. It slashes Medicare payments by 1% to the quarter of general hospitals with the highest rates of infections and other potentially preventable patient injuries. For the previous fiscal year, CMS punished 764 hospitals under that program. Those penalties – which would have cost hospitals an estimated $350 million in 2022 – will resume next fiscal year, with adjustments that better take COVID patients into account. CMS will also refine the readmissions penalty program to distinguish pneumonia patients from COVID patients.
“COVID has been a tremendously disruptive force for all aspects of health care, most certainly CMS’ quality measurement programs,” Mr. Demehin said. “It’s probably going to be a couple of volatile years for readmission penalties.”
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
resulting in the lightest penalties since 2014.
The Hospital Readmissions Reduction Program has been a mainstay of Medicare’s hospital payment system since it began in 2012. Created by the Affordable Care Act, the program evaluates the frequency with which Medicare patients at most hospitals return within 30 days and lowers future payments to hospitals that had a greater-than-expected rate of return. Hospitals can lose up to 3% of each Medicare payment for a year.
The pandemic threw hospitals into turmoil, inundating them with COVID patients while forcing many to postpone elective surgeries for months. When the Centers for Medicare & Medicaid Services evaluated hospitals’ previous 3 years of readmissions, as it does annually, the government decided to exclude the first half of 2020 because of the chaos caused by the pandemic. CMS also excluded from its calculations Medicare patients who were readmitted with pneumonia across all three years because of the difficulty in distinguishing them from patients with COVID.
Akin Demehin, senior director of quality and patient safety policy at the American Hospital Association, said the changes were warranted. “The COVID pandemic did a lot of really unprecedented things to care patterns of hospitals,” he said.
After making those changes, CMS evaluated 2½ years of readmission cases for Medicare patients who’d had heart failure, heart attacks, chronic obstructive pulmonary disease, coronary artery bypass grafts, and knee and hip replacements. As a result of its analysis, CMS penalized 2,273 hospitals, the fewest since the fiscal year that ended in September 2014, a KHN analysis found.
The average payment reduction was 0.43%, also the lowest since 2014. The reductions will be applied to each Medicare payment to the affected hospitals from Oct. 1 to next September and cost them $320 million over that 12-month period.
Some hospitals will see their penalties greatly reduced from 2021. The penalty on St. Mary’s Hospital in Athens, Ga., is dropping from 2.54% to 0.06%. Saint Joseph East in Lexington, Ky., received the maximum penalty, 3%, in 2021; it will lose 0.78% as of Oct. 1. In Flemington, N.J., the penalty for Hunterdon Medical Center is dropping from 2.29% to 0.12%.
To limit penalties, many hospitals in recent years have instituted new strategies to keep former patients from needing a return visit. Robert Coates, MD, interim chief medical officer at Hunterdon Health, which owns Hunterdon Medical Center, said in a statement that the hospital set up a system to identify patients who visited the emergency room within 30 days of a hospital stay. Instead of readmitting them, Hunterdon helps them set up next-day appointments at a doctor’s office or home monitoring of their health. Hunterdon also calls all discharged patients to ensure they have filled their prescriptions and had a follow-up visit with a clinician within a week of leaving the hospital.
Jessica Satterfield, MD, director of quality and clinical excellence at St. Mary’s Health Care System, which operates St. Mary’s Hospital, said in a statement that the hospital identified patients at risk of readmission when they were first admitted and focused on making sure that their medications were correct and that they had follow-up visits. “We are proud that our efforts are bearing fruit in the form of greatly reduced penalties but, more importantly, as a reflection of the exceptional care our staff and medical staff provide to our patients,” Dr. Satterfield said.
Saint Joseph East did not respond to emails seeking comment.
Despite the changes, 43% of the nation’s 5,236 hospitals were penalized. Of the unpenalized, all but 770 were automatically exempted. The 2,193 exempted hospitals include those that specialize in children, psychiatric patients, or veterans. Rehabilitation and long-term care hospitals are also excluded from the program, as are critical access hospitals, which Medicare pays differently to help them stay open in areas with no other hospitals. The government also exempted Maryland hospitals because that state has a special payment arrangement with Medicare. Of the hospitals that Medicare assessed, 75% were penalized.
For the new fiscal year, Medicare also cited the pandemic in giving hospitals a reprieve from its other major quality-focused effort that assesses penalties: the Hospital-Acquired Condition Reduction Program. It slashes Medicare payments by 1% to the quarter of general hospitals with the highest rates of infections and other potentially preventable patient injuries. For the previous fiscal year, CMS punished 764 hospitals under that program. Those penalties – which would have cost hospitals an estimated $350 million in 2022 – will resume next fiscal year, with adjustments that better take COVID patients into account. CMS will also refine the readmissions penalty program to distinguish pneumonia patients from COVID patients.
“COVID has been a tremendously disruptive force for all aspects of health care, most certainly CMS’ quality measurement programs,” Mr. Demehin said. “It’s probably going to be a couple of volatile years for readmission penalties.”
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
resulting in the lightest penalties since 2014.
The Hospital Readmissions Reduction Program has been a mainstay of Medicare’s hospital payment system since it began in 2012. Created by the Affordable Care Act, the program evaluates the frequency with which Medicare patients at most hospitals return within 30 days and lowers future payments to hospitals that had a greater-than-expected rate of return. Hospitals can lose up to 3% of each Medicare payment for a year.
The pandemic threw hospitals into turmoil, inundating them with COVID patients while forcing many to postpone elective surgeries for months. When the Centers for Medicare & Medicaid Services evaluated hospitals’ previous 3 years of readmissions, as it does annually, the government decided to exclude the first half of 2020 because of the chaos caused by the pandemic. CMS also excluded from its calculations Medicare patients who were readmitted with pneumonia across all three years because of the difficulty in distinguishing them from patients with COVID.
Akin Demehin, senior director of quality and patient safety policy at the American Hospital Association, said the changes were warranted. “The COVID pandemic did a lot of really unprecedented things to care patterns of hospitals,” he said.
After making those changes, CMS evaluated 2½ years of readmission cases for Medicare patients who’d had heart failure, heart attacks, chronic obstructive pulmonary disease, coronary artery bypass grafts, and knee and hip replacements. As a result of its analysis, CMS penalized 2,273 hospitals, the fewest since the fiscal year that ended in September 2014, a KHN analysis found.
The average payment reduction was 0.43%, also the lowest since 2014. The reductions will be applied to each Medicare payment to the affected hospitals from Oct. 1 to next September and cost them $320 million over that 12-month period.
Some hospitals will see their penalties greatly reduced from 2021. The penalty on St. Mary’s Hospital in Athens, Ga., is dropping from 2.54% to 0.06%. Saint Joseph East in Lexington, Ky., received the maximum penalty, 3%, in 2021; it will lose 0.78% as of Oct. 1. In Flemington, N.J., the penalty for Hunterdon Medical Center is dropping from 2.29% to 0.12%.
To limit penalties, many hospitals in recent years have instituted new strategies to keep former patients from needing a return visit. Robert Coates, MD, interim chief medical officer at Hunterdon Health, which owns Hunterdon Medical Center, said in a statement that the hospital set up a system to identify patients who visited the emergency room within 30 days of a hospital stay. Instead of readmitting them, Hunterdon helps them set up next-day appointments at a doctor’s office or home monitoring of their health. Hunterdon also calls all discharged patients to ensure they have filled their prescriptions and had a follow-up visit with a clinician within a week of leaving the hospital.
Jessica Satterfield, MD, director of quality and clinical excellence at St. Mary’s Health Care System, which operates St. Mary’s Hospital, said in a statement that the hospital identified patients at risk of readmission when they were first admitted and focused on making sure that their medications were correct and that they had follow-up visits. “We are proud that our efforts are bearing fruit in the form of greatly reduced penalties but, more importantly, as a reflection of the exceptional care our staff and medical staff provide to our patients,” Dr. Satterfield said.
Saint Joseph East did not respond to emails seeking comment.
Despite the changes, 43% of the nation’s 5,236 hospitals were penalized. Of the unpenalized, all but 770 were automatically exempted. The 2,193 exempted hospitals include those that specialize in children, psychiatric patients, or veterans. Rehabilitation and long-term care hospitals are also excluded from the program, as are critical access hospitals, which Medicare pays differently to help them stay open in areas with no other hospitals. The government also exempted Maryland hospitals because that state has a special payment arrangement with Medicare. Of the hospitals that Medicare assessed, 75% were penalized.
For the new fiscal year, Medicare also cited the pandemic in giving hospitals a reprieve from its other major quality-focused effort that assesses penalties: the Hospital-Acquired Condition Reduction Program. It slashes Medicare payments by 1% to the quarter of general hospitals with the highest rates of infections and other potentially preventable patient injuries. For the previous fiscal year, CMS punished 764 hospitals under that program. Those penalties – which would have cost hospitals an estimated $350 million in 2022 – will resume next fiscal year, with adjustments that better take COVID patients into account. CMS will also refine the readmissions penalty program to distinguish pneumonia patients from COVID patients.
“COVID has been a tremendously disruptive force for all aspects of health care, most certainly CMS’ quality measurement programs,” Mr. Demehin said. “It’s probably going to be a couple of volatile years for readmission penalties.”
KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.
Under Trump, hospitals face same penalties embraced by Obama
Amid all the turbulence over the future of the Affordable Care Act, one facet continues unchanged: President Trump’s administration is penalizing more than half the nation’s hospitals for having too many patients return within a month.
Medicare is punishing 2,573 hospitals, just two dozen short of what it did last year under President Obama, according to federal records released Aug. 2. Starting in October, the federal government will cut those hospitals’ payments by as much as 3% for a year.
Medicare docked all but 174 of those hospitals last year as well. The $564 million the government projects to save also is roughly the same as it was last year under Obama.
High rates of readmissions have been a safety concern for decades, with one in five Medicare patients historically ending up back in the hospital within 30 days. In 2011, 3.3 million adults returned to the hospital, running up medical costs estimated at $41 billion, according to the Agency for Healthcare Research and Quality.
The penalties, which begin their sixth year in October, have coincided with a nationwide decrease in hospital repeat patients. Between 2007 and 2015, the frequency of readmissions for conditions targeted by Medicare dropped from 21.5% to 17.8%, with the majority of the decrease occurring shortly after the ACA passed in 2010, according to a study conducted by Obama administration health policy experts and published in 2016 in the New England Journal of Medicine.
Some hospitals began giving impoverished patients free medications that they prescribed for their recovery, while others sent nurses to check up on patients seen as most likely to relapse in their homes. Readmissions dropped more quickly at hospitals potentially subject to the penalty than at other hospitals, another study found.
“The sum of the evidence really suggests that this program is helping people,” said Susannah Bernheim, MD, the director of quality measurement at the Yale/Yale-New Haven Hospital Center for Outcomes Research and Evaluation.
But the pace of these reductions has been leveling off in the past few years, indicating that the penalties’ ability to induce improvements may be waning.
“Presumably, hospitals made substantial changes during the implementation period but could not sustain such a high rate of reductions in the long term,” the New England Journal article said.
An analysis by Dr. Bernheim’s group found no decrease in the overall rate of readmissions between 2012 and 2015, although small drops in the medical conditions targeted by the penalties continued.
“We have indeed reached the limits of what changes in how we deliver care will allow us to do,” said Nancy Foster, vice president for quality at the American Hospital Association. “We can’t prevent every readmission. It could be that there is further room for improvement, but we just don’t know what the technique is to make that happen.”
The Hospital Readmissions Reduction Program was designed to use the purchasing power of Medicare to reward hospitals for higher quality. Those penalties, along with other ones aimed at improving hospital care, have been spared the partisan rancor over the law, and they would have continued under the GOP repeal proposals that stalled in Congress. But they have also been largely ignored.
Ashish Jha, MD, a professor at the Harvard T.H. Chan School of Public Health, Boston, said the fight over abolishing the ACA has drowned out talk about how to make the health care system more effective.
“We’ve spent the last 6 months fighting about how we’re going to pay for health insurance, which is one part of the ACA,” he said. “There’s been almost no discussion of the underlying health care delivery system changes that the ACA ushered in, and that is more important in the long run to be discussing because that’s what’s going to determine the underlying costs and outcomes of the health system.”
The readmission penalties are intended to neutralize an unintended incentive in the way Medicare pays hospitals that had profited from return patients. Medicare pays hospitals a lump sum for a patient’s stay based on the nature of the admission and other factors. Since hospitals generally are not paid extra if patients remain longer, they seek to discharge patients as soon as is medically feasible. If the patient ends up back in the hospital, it becomes a financial benefit as the hospital is paid for that second stay, filling a bed that would not have generated income if the patient had remained there continuously.
Because of the way the readmission penalty program was designed, it is not surprising that the new results are so similar to last year’s. As before, Medicare determined the penalties based on readmissions of the same six types of patients: those admitted for heart attacks, heart failure, pneumonia, chronic lung disease, hip or knee replacements, or coronary artery bypass graft surgery. Hospitals were judged on patients discharged between July 2013 and June 2016. Because the government looks at a 3-year period, 2 of those years were also examined in determining last year’s penalties.
This year, the average penalty will be 0.73% of each payment Medicare makes for a patient between Oct. 1 and Sept. 30, 2018, according to a Kaiser Health News analysis. That too was practically the same as last year. Forty-eight hospitals received the maximum punishment of a 3% reduction. Medicare did not release hospital-specific estimates for how much lost money these penalties would translate to.
More than 1,500 hospitals treating veterans, children, and psychiatric patients were exempted from penalties this year as required by law. Critical access hospitals, which Medicare also pays differently, also were excluded. So were Maryland hospitals because Congress has given that state extra leeway in how it distributes Medicare money.
Of the 3,241 hospitals whose readmissions were evaluated, Medicare penalized four out of five, the KHN analysis found. That is because the program’s methods are not very forgiving: A hospital can be penalized even if it has higher than expected readmission rates for only one of the six conditions that are targeted. Every nonexcluded hospital in Delaware and West Virginia will have their reimbursements reduced. Ninety percent or more will be punished in Arizona, Connecticut, Florida, Kentucky, Massachusetts, Minnesota, New Jersey, New York, and Virginia. Sixty percent or fewer will be penalized in Colorado, Kansas, Idaho, Montana, Oregon, South Dakota, and Utah.
Since the readmission program’s structure is set by law, the administration cannot make major changes unilaterally, even if it wanted to.
Congress last year instructed Medicare to make one future alteration in response to complaints from safety-net hospitals and major academic medical centers.
They have objected that their patients tended to be lower income than other hospitals and were more likely to return to the hospital, sometimes because they didn’t have a primary care doctor and other times because they could not afford the right medication or diet. Those hospitals argued that this was a disadvantage for them since Medicare bases its readmission targets on industry-wide trends and that it hurt them financially, depriving them of resources they could use to help those same patients.
Dr. Bernheim noted that, despite those complaints, safety-net hospitals have shown some of the greatest drops in readmission rates. In October 2018, Medicare will begin basing the penalties on how hospitals compared with their peer groups with similar numbers of poor patients. Akin Demehin, director of policy at the hospital association, said, “We expect the adjustment will provide some relief for safety-net hospitals.”
Medicare is planning to release two other rounds of recurring quality incentives for hospitals later this year. One gives out bonuses and penalties based on a mix of measures, with Medicare redistributing $1.9 billion based on how hospitals perform and improve. The other, the Hospital-Acquired Condition Reduction Program, cuts payments to roughly 750 hospitals with the highest rates of infections and other patient injuries by 1%.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation.
Amid all the turbulence over the future of the Affordable Care Act, one facet continues unchanged: President Trump’s administration is penalizing more than half the nation’s hospitals for having too many patients return within a month.
Medicare is punishing 2,573 hospitals, just two dozen short of what it did last year under President Obama, according to federal records released Aug. 2. Starting in October, the federal government will cut those hospitals’ payments by as much as 3% for a year.
Medicare docked all but 174 of those hospitals last year as well. The $564 million the government projects to save also is roughly the same as it was last year under Obama.
High rates of readmissions have been a safety concern for decades, with one in five Medicare patients historically ending up back in the hospital within 30 days. In 2011, 3.3 million adults returned to the hospital, running up medical costs estimated at $41 billion, according to the Agency for Healthcare Research and Quality.
The penalties, which begin their sixth year in October, have coincided with a nationwide decrease in hospital repeat patients. Between 2007 and 2015, the frequency of readmissions for conditions targeted by Medicare dropped from 21.5% to 17.8%, with the majority of the decrease occurring shortly after the ACA passed in 2010, according to a study conducted by Obama administration health policy experts and published in 2016 in the New England Journal of Medicine.
Some hospitals began giving impoverished patients free medications that they prescribed for their recovery, while others sent nurses to check up on patients seen as most likely to relapse in their homes. Readmissions dropped more quickly at hospitals potentially subject to the penalty than at other hospitals, another study found.
“The sum of the evidence really suggests that this program is helping people,” said Susannah Bernheim, MD, the director of quality measurement at the Yale/Yale-New Haven Hospital Center for Outcomes Research and Evaluation.
But the pace of these reductions has been leveling off in the past few years, indicating that the penalties’ ability to induce improvements may be waning.
“Presumably, hospitals made substantial changes during the implementation period but could not sustain such a high rate of reductions in the long term,” the New England Journal article said.
An analysis by Dr. Bernheim’s group found no decrease in the overall rate of readmissions between 2012 and 2015, although small drops in the medical conditions targeted by the penalties continued.
“We have indeed reached the limits of what changes in how we deliver care will allow us to do,” said Nancy Foster, vice president for quality at the American Hospital Association. “We can’t prevent every readmission. It could be that there is further room for improvement, but we just don’t know what the technique is to make that happen.”
The Hospital Readmissions Reduction Program was designed to use the purchasing power of Medicare to reward hospitals for higher quality. Those penalties, along with other ones aimed at improving hospital care, have been spared the partisan rancor over the law, and they would have continued under the GOP repeal proposals that stalled in Congress. But they have also been largely ignored.
Ashish Jha, MD, a professor at the Harvard T.H. Chan School of Public Health, Boston, said the fight over abolishing the ACA has drowned out talk about how to make the health care system more effective.
“We’ve spent the last 6 months fighting about how we’re going to pay for health insurance, which is one part of the ACA,” he said. “There’s been almost no discussion of the underlying health care delivery system changes that the ACA ushered in, and that is more important in the long run to be discussing because that’s what’s going to determine the underlying costs and outcomes of the health system.”
The readmission penalties are intended to neutralize an unintended incentive in the way Medicare pays hospitals that had profited from return patients. Medicare pays hospitals a lump sum for a patient’s stay based on the nature of the admission and other factors. Since hospitals generally are not paid extra if patients remain longer, they seek to discharge patients as soon as is medically feasible. If the patient ends up back in the hospital, it becomes a financial benefit as the hospital is paid for that second stay, filling a bed that would not have generated income if the patient had remained there continuously.
Because of the way the readmission penalty program was designed, it is not surprising that the new results are so similar to last year’s. As before, Medicare determined the penalties based on readmissions of the same six types of patients: those admitted for heart attacks, heart failure, pneumonia, chronic lung disease, hip or knee replacements, or coronary artery bypass graft surgery. Hospitals were judged on patients discharged between July 2013 and June 2016. Because the government looks at a 3-year period, 2 of those years were also examined in determining last year’s penalties.
This year, the average penalty will be 0.73% of each payment Medicare makes for a patient between Oct. 1 and Sept. 30, 2018, according to a Kaiser Health News analysis. That too was practically the same as last year. Forty-eight hospitals received the maximum punishment of a 3% reduction. Medicare did not release hospital-specific estimates for how much lost money these penalties would translate to.
More than 1,500 hospitals treating veterans, children, and psychiatric patients were exempted from penalties this year as required by law. Critical access hospitals, which Medicare also pays differently, also were excluded. So were Maryland hospitals because Congress has given that state extra leeway in how it distributes Medicare money.
Of the 3,241 hospitals whose readmissions were evaluated, Medicare penalized four out of five, the KHN analysis found. That is because the program’s methods are not very forgiving: A hospital can be penalized even if it has higher than expected readmission rates for only one of the six conditions that are targeted. Every nonexcluded hospital in Delaware and West Virginia will have their reimbursements reduced. Ninety percent or more will be punished in Arizona, Connecticut, Florida, Kentucky, Massachusetts, Minnesota, New Jersey, New York, and Virginia. Sixty percent or fewer will be penalized in Colorado, Kansas, Idaho, Montana, Oregon, South Dakota, and Utah.
Since the readmission program’s structure is set by law, the administration cannot make major changes unilaterally, even if it wanted to.
Congress last year instructed Medicare to make one future alteration in response to complaints from safety-net hospitals and major academic medical centers.
They have objected that their patients tended to be lower income than other hospitals and were more likely to return to the hospital, sometimes because they didn’t have a primary care doctor and other times because they could not afford the right medication or diet. Those hospitals argued that this was a disadvantage for them since Medicare bases its readmission targets on industry-wide trends and that it hurt them financially, depriving them of resources they could use to help those same patients.
Dr. Bernheim noted that, despite those complaints, safety-net hospitals have shown some of the greatest drops in readmission rates. In October 2018, Medicare will begin basing the penalties on how hospitals compared with their peer groups with similar numbers of poor patients. Akin Demehin, director of policy at the hospital association, said, “We expect the adjustment will provide some relief for safety-net hospitals.”
Medicare is planning to release two other rounds of recurring quality incentives for hospitals later this year. One gives out bonuses and penalties based on a mix of measures, with Medicare redistributing $1.9 billion based on how hospitals perform and improve. The other, the Hospital-Acquired Condition Reduction Program, cuts payments to roughly 750 hospitals with the highest rates of infections and other patient injuries by 1%.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation.
Amid all the turbulence over the future of the Affordable Care Act, one facet continues unchanged: President Trump’s administration is penalizing more than half the nation’s hospitals for having too many patients return within a month.
Medicare is punishing 2,573 hospitals, just two dozen short of what it did last year under President Obama, according to federal records released Aug. 2. Starting in October, the federal government will cut those hospitals’ payments by as much as 3% for a year.
Medicare docked all but 174 of those hospitals last year as well. The $564 million the government projects to save also is roughly the same as it was last year under Obama.
High rates of readmissions have been a safety concern for decades, with one in five Medicare patients historically ending up back in the hospital within 30 days. In 2011, 3.3 million adults returned to the hospital, running up medical costs estimated at $41 billion, according to the Agency for Healthcare Research and Quality.
The penalties, which begin their sixth year in October, have coincided with a nationwide decrease in hospital repeat patients. Between 2007 and 2015, the frequency of readmissions for conditions targeted by Medicare dropped from 21.5% to 17.8%, with the majority of the decrease occurring shortly after the ACA passed in 2010, according to a study conducted by Obama administration health policy experts and published in 2016 in the New England Journal of Medicine.
Some hospitals began giving impoverished patients free medications that they prescribed for their recovery, while others sent nurses to check up on patients seen as most likely to relapse in their homes. Readmissions dropped more quickly at hospitals potentially subject to the penalty than at other hospitals, another study found.
“The sum of the evidence really suggests that this program is helping people,” said Susannah Bernheim, MD, the director of quality measurement at the Yale/Yale-New Haven Hospital Center for Outcomes Research and Evaluation.
But the pace of these reductions has been leveling off in the past few years, indicating that the penalties’ ability to induce improvements may be waning.
“Presumably, hospitals made substantial changes during the implementation period but could not sustain such a high rate of reductions in the long term,” the New England Journal article said.
An analysis by Dr. Bernheim’s group found no decrease in the overall rate of readmissions between 2012 and 2015, although small drops in the medical conditions targeted by the penalties continued.
“We have indeed reached the limits of what changes in how we deliver care will allow us to do,” said Nancy Foster, vice president for quality at the American Hospital Association. “We can’t prevent every readmission. It could be that there is further room for improvement, but we just don’t know what the technique is to make that happen.”
The Hospital Readmissions Reduction Program was designed to use the purchasing power of Medicare to reward hospitals for higher quality. Those penalties, along with other ones aimed at improving hospital care, have been spared the partisan rancor over the law, and they would have continued under the GOP repeal proposals that stalled in Congress. But they have also been largely ignored.
Ashish Jha, MD, a professor at the Harvard T.H. Chan School of Public Health, Boston, said the fight over abolishing the ACA has drowned out talk about how to make the health care system more effective.
“We’ve spent the last 6 months fighting about how we’re going to pay for health insurance, which is one part of the ACA,” he said. “There’s been almost no discussion of the underlying health care delivery system changes that the ACA ushered in, and that is more important in the long run to be discussing because that’s what’s going to determine the underlying costs and outcomes of the health system.”
The readmission penalties are intended to neutralize an unintended incentive in the way Medicare pays hospitals that had profited from return patients. Medicare pays hospitals a lump sum for a patient’s stay based on the nature of the admission and other factors. Since hospitals generally are not paid extra if patients remain longer, they seek to discharge patients as soon as is medically feasible. If the patient ends up back in the hospital, it becomes a financial benefit as the hospital is paid for that second stay, filling a bed that would not have generated income if the patient had remained there continuously.
Because of the way the readmission penalty program was designed, it is not surprising that the new results are so similar to last year’s. As before, Medicare determined the penalties based on readmissions of the same six types of patients: those admitted for heart attacks, heart failure, pneumonia, chronic lung disease, hip or knee replacements, or coronary artery bypass graft surgery. Hospitals were judged on patients discharged between July 2013 and June 2016. Because the government looks at a 3-year period, 2 of those years were also examined in determining last year’s penalties.
This year, the average penalty will be 0.73% of each payment Medicare makes for a patient between Oct. 1 and Sept. 30, 2018, according to a Kaiser Health News analysis. That too was practically the same as last year. Forty-eight hospitals received the maximum punishment of a 3% reduction. Medicare did not release hospital-specific estimates for how much lost money these penalties would translate to.
More than 1,500 hospitals treating veterans, children, and psychiatric patients were exempted from penalties this year as required by law. Critical access hospitals, which Medicare also pays differently, also were excluded. So were Maryland hospitals because Congress has given that state extra leeway in how it distributes Medicare money.
Of the 3,241 hospitals whose readmissions were evaluated, Medicare penalized four out of five, the KHN analysis found. That is because the program’s methods are not very forgiving: A hospital can be penalized even if it has higher than expected readmission rates for only one of the six conditions that are targeted. Every nonexcluded hospital in Delaware and West Virginia will have their reimbursements reduced. Ninety percent or more will be punished in Arizona, Connecticut, Florida, Kentucky, Massachusetts, Minnesota, New Jersey, New York, and Virginia. Sixty percent or fewer will be penalized in Colorado, Kansas, Idaho, Montana, Oregon, South Dakota, and Utah.
Since the readmission program’s structure is set by law, the administration cannot make major changes unilaterally, even if it wanted to.
Congress last year instructed Medicare to make one future alteration in response to complaints from safety-net hospitals and major academic medical centers.
They have objected that their patients tended to be lower income than other hospitals and were more likely to return to the hospital, sometimes because they didn’t have a primary care doctor and other times because they could not afford the right medication or diet. Those hospitals argued that this was a disadvantage for them since Medicare bases its readmission targets on industry-wide trends and that it hurt them financially, depriving them of resources they could use to help those same patients.
Dr. Bernheim noted that, despite those complaints, safety-net hospitals have shown some of the greatest drops in readmission rates. In October 2018, Medicare will begin basing the penalties on how hospitals compared with their peer groups with similar numbers of poor patients. Akin Demehin, director of policy at the hospital association, said, “We expect the adjustment will provide some relief for safety-net hospitals.”
Medicare is planning to release two other rounds of recurring quality incentives for hospitals later this year. One gives out bonuses and penalties based on a mix of measures, with Medicare redistributing $1.9 billion based on how hospitals perform and improve. The other, the Hospital-Acquired Condition Reduction Program, cuts payments to roughly 750 hospitals with the highest rates of infections and other patient injuries by 1%.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation.
Medicare delays plans for new star ratings on hospitals
Bowing to pressure from the hospital industry and Congress, the Obama administration on April 20 delayed releasing its new hospital quality rating measure just a day before its planned launch.
The new “overall hospital quality” star rating aimed to combine the government’s disparate efforts to measure hospital care into one easy-to-grasp metric. The Centers for Medicare & Medicaid Services now publishes more than 100 measures of aspects of hospital care, but many of these measures are technical and confusing since hospitals often do well on some and poorly on others. The new star rating boils 62 of the measures down into a unified rating of one to five stars, with five being the best.
But this month, 60 senators and 225 members of the House of Representatives signed letters urging the CMS to delay releasing the star ratings. “We have heard from hospitals in our districts that they do not have the necessary data to replicate or evaluate the CMS’s work to ensure that the methodology is accurate or fair,” the letter from the House members said.
In a notice sent April 20, the CMS told Congress it would delay release of the star ratings on its Hospital Compare website until July 2016. The “CMS is committed to working with hospitals and associations to provide further guidance about star ratings,” the notice said. “After the star ratings go live in their first iteration, we will refine and improve the site as we work together and gain experience.”
But in a conference call with hospital representatives, the CMS officials said they might delay release of the ratings past July if they are still analyzing or revising the methodology, according to people who participated in the call.
Mortality, readmissions, patient experience, and safety of care metrics each accounted for 22% of the star rating, while measures of effectiveness of care, timeliness of care, and efficient use of medical imaging made up 12% in total.
The hospital industry for months has been urging this delay, arguing that many of the measures will not be relevant to patients seeking a specific service. For instance, a hospital’s death rate for Medicare patients might be irrelevant for a woman trying to decide where to give birth.
The industry’s major trade groups said in a letter to the CMS that some hospitals perform poorly because their patients tend to be lower income and don’t have the support at home. Many of the nation’s most prestigious hospitals have been bracing for middling or poor ratings.
Rick Pollack, president of the American Hospital Association, said in a statement that “the delay is a necessary step as hospitals and health systems work with CMS to improve the ratings for patients, and the AHA commends CMS for their decision.”
Last year, the CMS created a star rating to represent the views of patients in surveys. Two sets of researchers recently determined that hospitals with more stars in patient experience tended to have lower death and readmission rates.
Hospital Compare received 3.7 million unique page views last year, according to an April 2016 paper published in the journal Health Affairs. The author, analyst Steven D. Findlay, called the traffic “not at a level commensurate with [the] stature and potential” of the federal government’s health care facility comparison sites.
Dr. Ashish Jha, a Harvard School of Public Health researcher, said consumers will be more likely to use the unified star ratings, but this specific mix of measures raises concerns. “The idea that dying and being readmitted to the hospital are equally important to patients seems funny to me,” he said.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
Bowing to pressure from the hospital industry and Congress, the Obama administration on April 20 delayed releasing its new hospital quality rating measure just a day before its planned launch.
The new “overall hospital quality” star rating aimed to combine the government’s disparate efforts to measure hospital care into one easy-to-grasp metric. The Centers for Medicare & Medicaid Services now publishes more than 100 measures of aspects of hospital care, but many of these measures are technical and confusing since hospitals often do well on some and poorly on others. The new star rating boils 62 of the measures down into a unified rating of one to five stars, with five being the best.
But this month, 60 senators and 225 members of the House of Representatives signed letters urging the CMS to delay releasing the star ratings. “We have heard from hospitals in our districts that they do not have the necessary data to replicate or evaluate the CMS’s work to ensure that the methodology is accurate or fair,” the letter from the House members said.
In a notice sent April 20, the CMS told Congress it would delay release of the star ratings on its Hospital Compare website until July 2016. The “CMS is committed to working with hospitals and associations to provide further guidance about star ratings,” the notice said. “After the star ratings go live in their first iteration, we will refine and improve the site as we work together and gain experience.”
But in a conference call with hospital representatives, the CMS officials said they might delay release of the ratings past July if they are still analyzing or revising the methodology, according to people who participated in the call.
Mortality, readmissions, patient experience, and safety of care metrics each accounted for 22% of the star rating, while measures of effectiveness of care, timeliness of care, and efficient use of medical imaging made up 12% in total.
The hospital industry for months has been urging this delay, arguing that many of the measures will not be relevant to patients seeking a specific service. For instance, a hospital’s death rate for Medicare patients might be irrelevant for a woman trying to decide where to give birth.
The industry’s major trade groups said in a letter to the CMS that some hospitals perform poorly because their patients tend to be lower income and don’t have the support at home. Many of the nation’s most prestigious hospitals have been bracing for middling or poor ratings.
Rick Pollack, president of the American Hospital Association, said in a statement that “the delay is a necessary step as hospitals and health systems work with CMS to improve the ratings for patients, and the AHA commends CMS for their decision.”
Last year, the CMS created a star rating to represent the views of patients in surveys. Two sets of researchers recently determined that hospitals with more stars in patient experience tended to have lower death and readmission rates.
Hospital Compare received 3.7 million unique page views last year, according to an April 2016 paper published in the journal Health Affairs. The author, analyst Steven D. Findlay, called the traffic “not at a level commensurate with [the] stature and potential” of the federal government’s health care facility comparison sites.
Dr. Ashish Jha, a Harvard School of Public Health researcher, said consumers will be more likely to use the unified star ratings, but this specific mix of measures raises concerns. “The idea that dying and being readmitted to the hospital are equally important to patients seems funny to me,” he said.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
Bowing to pressure from the hospital industry and Congress, the Obama administration on April 20 delayed releasing its new hospital quality rating measure just a day before its planned launch.
The new “overall hospital quality” star rating aimed to combine the government’s disparate efforts to measure hospital care into one easy-to-grasp metric. The Centers for Medicare & Medicaid Services now publishes more than 100 measures of aspects of hospital care, but many of these measures are technical and confusing since hospitals often do well on some and poorly on others. The new star rating boils 62 of the measures down into a unified rating of one to five stars, with five being the best.
But this month, 60 senators and 225 members of the House of Representatives signed letters urging the CMS to delay releasing the star ratings. “We have heard from hospitals in our districts that they do not have the necessary data to replicate or evaluate the CMS’s work to ensure that the methodology is accurate or fair,” the letter from the House members said.
In a notice sent April 20, the CMS told Congress it would delay release of the star ratings on its Hospital Compare website until July 2016. The “CMS is committed to working with hospitals and associations to provide further guidance about star ratings,” the notice said. “After the star ratings go live in their first iteration, we will refine and improve the site as we work together and gain experience.”
But in a conference call with hospital representatives, the CMS officials said they might delay release of the ratings past July if they are still analyzing or revising the methodology, according to people who participated in the call.
Mortality, readmissions, patient experience, and safety of care metrics each accounted for 22% of the star rating, while measures of effectiveness of care, timeliness of care, and efficient use of medical imaging made up 12% in total.
The hospital industry for months has been urging this delay, arguing that many of the measures will not be relevant to patients seeking a specific service. For instance, a hospital’s death rate for Medicare patients might be irrelevant for a woman trying to decide where to give birth.
The industry’s major trade groups said in a letter to the CMS that some hospitals perform poorly because their patients tend to be lower income and don’t have the support at home. Many of the nation’s most prestigious hospitals have been bracing for middling or poor ratings.
Rick Pollack, president of the American Hospital Association, said in a statement that “the delay is a necessary step as hospitals and health systems work with CMS to improve the ratings for patients, and the AHA commends CMS for their decision.”
Last year, the CMS created a star rating to represent the views of patients in surveys. Two sets of researchers recently determined that hospitals with more stars in patient experience tended to have lower death and readmission rates.
Hospital Compare received 3.7 million unique page views last year, according to an April 2016 paper published in the journal Health Affairs. The author, analyst Steven D. Findlay, called the traffic “not at a level commensurate with [the] stature and potential” of the federal government’s health care facility comparison sites.
Dr. Ashish Jha, a Harvard School of Public Health researcher, said consumers will be more likely to use the unified star ratings, but this specific mix of measures raises concerns. “The idea that dying and being readmitted to the hospital are equally important to patients seems funny to me,” he said.
Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
FROM KAISER HEALTH NEWS
After 3 years of decline, hospital injury rates plateau, report finds
The rate of avoidable complications affecting patients in hospitals leveled off in 2014 after 3 years of declines, according to a federal report released Dec. 1.
Hospitals have averted many types of injuries where clear preventive steps have been identified, but they still struggle to avert complications with broader causes and less clear-cut solutions, government and hospital officials said.
There were at least 4 million infections and other potentially avoidable injuries in hospitals last year, the study estimated. That translates to about 12 of every 100 hospital stays. Among the most common complications that were measured – each occurring a quarter million times or more – were bed sores, falls, bad reactions to drugs used to treat diabetes, and kidney damage that develops after contrast dyes are injected through catheters to help radiologists take images of blood vessels.
The frequency of hospital complications last year was 17% lower than in 2010 but the same as in 2013, indicating that some patient safety improvements made by hospitals and the government are sticking. But the lack of improvement raised concerns that it is becoming harder for hospitals to further reduce the chances that a patient may be harmed during a visit.
“We are still trying to understand all the factors involved, but I think the improvements we saw from 2010 to 2013 were very likely the low-hanging fruit, the easy problems to solve,” said Dr. Richard Kronick, director of the U.S. Agency for Healthcare Research and Quality (AHRQ), which conducted the study.
The Obama administration has been focusing on lowering the rates of medical infections and injuries as it tracks a slew of patient safety initiatives created by the Affordable Care Act. Those include Medicare penalties for poor-performing hospitals, wider use of electronic records to help track patient care and prevent mistakes, and grants to collaborations of medical providers formed to improve the quality of patient care and identify the best ways of addressing each type of problem.
The AHRQ report calculated national rates for 27 specific complications by extrapolating from 30,000 medical cases that officials examined. Decreases in infections, medicine reactions, and other complications since 2010 have resulted in 2.1 million fewer incidents of harm, 87,000 fewer deaths, and $20 billion in health care savings, the report concluded.
“Those are real people that are not dying, getting infections or other adverse events in the hospital,” said Dr. Patrick Conway, chief medical officer for the Centers for Medicare & Medicaid Services.
Some of the most significant progress was made in lowering the number of infections from central lines inserted into veins – down 72% from 2010. Medical researchers have proven that these infections can be virtually eliminated if doctors and nurses follow a clear set of procedures.
Infections from urinary catheters decreased by 38% and surgical site infections dropped by 18%. In all three cases, the reductions exceeded the goals set by the administration. Dr. Conway noted that hospitals had a financial motivation to cut these infections as they are used to determine whether hospitals get Medicare bonuses and penalties each year.
However, hospitals have not made headway in trimming the numbers of falls or pneumonia cases in patients breathing through mechanical ventilators, the report found. And the rates of adverse drug reactions and complications during childbirth were higher than what the administration estimated they should be for 2014.
Dr. Conway said that complications are difficult to address because they involve tradeoffs that can cause other problems. For instance, he said, hospitals have to balance efforts to reduce falls with the need to help unstable patients improve their ability to walk. “We’ve got to work with providers to figure out what’s the sweet spot that can keep mobilization occurring but decrease the rate of falls,” he said.
Even though overall complication rates were flat, the report found that some types of injuries became less common in 2014. One was the number of blood clots that form after surgery and travel to the lung; those rates dropped by 30% in a year.
Maulik Joshi, an executive at the American Hospital Association, predicted that complications will become even rarer in future years. “Hospitals are working on projects that are just not reflected in these data points,” he said.
But a few conditions became more prevalent in 2014. Infections from methicillin-resistant Staphylococcus aureus increased by 55% to an estimated 17,000 incidents last year. The number of times a catheter punctured a femoral artery during an angiography increased by 25% to 74,000, the report estimated.
“We think we addressed a lot of the areas where there was a strong evidence base on how to improve patient safety,” Dr. Conway said. “We’ll now have to tackle that next wave that has multiple causes.”
The rate of avoidable complications affecting patients in hospitals leveled off in 2014 after 3 years of declines, according to a federal report released Dec. 1.
Hospitals have averted many types of injuries where clear preventive steps have been identified, but they still struggle to avert complications with broader causes and less clear-cut solutions, government and hospital officials said.
There were at least 4 million infections and other potentially avoidable injuries in hospitals last year, the study estimated. That translates to about 12 of every 100 hospital stays. Among the most common complications that were measured – each occurring a quarter million times or more – were bed sores, falls, bad reactions to drugs used to treat diabetes, and kidney damage that develops after contrast dyes are injected through catheters to help radiologists take images of blood vessels.
The frequency of hospital complications last year was 17% lower than in 2010 but the same as in 2013, indicating that some patient safety improvements made by hospitals and the government are sticking. But the lack of improvement raised concerns that it is becoming harder for hospitals to further reduce the chances that a patient may be harmed during a visit.
“We are still trying to understand all the factors involved, but I think the improvements we saw from 2010 to 2013 were very likely the low-hanging fruit, the easy problems to solve,” said Dr. Richard Kronick, director of the U.S. Agency for Healthcare Research and Quality (AHRQ), which conducted the study.
The Obama administration has been focusing on lowering the rates of medical infections and injuries as it tracks a slew of patient safety initiatives created by the Affordable Care Act. Those include Medicare penalties for poor-performing hospitals, wider use of electronic records to help track patient care and prevent mistakes, and grants to collaborations of medical providers formed to improve the quality of patient care and identify the best ways of addressing each type of problem.
The AHRQ report calculated national rates for 27 specific complications by extrapolating from 30,000 medical cases that officials examined. Decreases in infections, medicine reactions, and other complications since 2010 have resulted in 2.1 million fewer incidents of harm, 87,000 fewer deaths, and $20 billion in health care savings, the report concluded.
“Those are real people that are not dying, getting infections or other adverse events in the hospital,” said Dr. Patrick Conway, chief medical officer for the Centers for Medicare & Medicaid Services.
Some of the most significant progress was made in lowering the number of infections from central lines inserted into veins – down 72% from 2010. Medical researchers have proven that these infections can be virtually eliminated if doctors and nurses follow a clear set of procedures.
Infections from urinary catheters decreased by 38% and surgical site infections dropped by 18%. In all three cases, the reductions exceeded the goals set by the administration. Dr. Conway noted that hospitals had a financial motivation to cut these infections as they are used to determine whether hospitals get Medicare bonuses and penalties each year.
However, hospitals have not made headway in trimming the numbers of falls or pneumonia cases in patients breathing through mechanical ventilators, the report found. And the rates of adverse drug reactions and complications during childbirth were higher than what the administration estimated they should be for 2014.
Dr. Conway said that complications are difficult to address because they involve tradeoffs that can cause other problems. For instance, he said, hospitals have to balance efforts to reduce falls with the need to help unstable patients improve their ability to walk. “We’ve got to work with providers to figure out what’s the sweet spot that can keep mobilization occurring but decrease the rate of falls,” he said.
Even though overall complication rates were flat, the report found that some types of injuries became less common in 2014. One was the number of blood clots that form after surgery and travel to the lung; those rates dropped by 30% in a year.
Maulik Joshi, an executive at the American Hospital Association, predicted that complications will become even rarer in future years. “Hospitals are working on projects that are just not reflected in these data points,” he said.
But a few conditions became more prevalent in 2014. Infections from methicillin-resistant Staphylococcus aureus increased by 55% to an estimated 17,000 incidents last year. The number of times a catheter punctured a femoral artery during an angiography increased by 25% to 74,000, the report estimated.
“We think we addressed a lot of the areas where there was a strong evidence base on how to improve patient safety,” Dr. Conway said. “We’ll now have to tackle that next wave that has multiple causes.”
The rate of avoidable complications affecting patients in hospitals leveled off in 2014 after 3 years of declines, according to a federal report released Dec. 1.
Hospitals have averted many types of injuries where clear preventive steps have been identified, but they still struggle to avert complications with broader causes and less clear-cut solutions, government and hospital officials said.
There were at least 4 million infections and other potentially avoidable injuries in hospitals last year, the study estimated. That translates to about 12 of every 100 hospital stays. Among the most common complications that were measured – each occurring a quarter million times or more – were bed sores, falls, bad reactions to drugs used to treat diabetes, and kidney damage that develops after contrast dyes are injected through catheters to help radiologists take images of blood vessels.
The frequency of hospital complications last year was 17% lower than in 2010 but the same as in 2013, indicating that some patient safety improvements made by hospitals and the government are sticking. But the lack of improvement raised concerns that it is becoming harder for hospitals to further reduce the chances that a patient may be harmed during a visit.
“We are still trying to understand all the factors involved, but I think the improvements we saw from 2010 to 2013 were very likely the low-hanging fruit, the easy problems to solve,” said Dr. Richard Kronick, director of the U.S. Agency for Healthcare Research and Quality (AHRQ), which conducted the study.
The Obama administration has been focusing on lowering the rates of medical infections and injuries as it tracks a slew of patient safety initiatives created by the Affordable Care Act. Those include Medicare penalties for poor-performing hospitals, wider use of electronic records to help track patient care and prevent mistakes, and grants to collaborations of medical providers formed to improve the quality of patient care and identify the best ways of addressing each type of problem.
The AHRQ report calculated national rates for 27 specific complications by extrapolating from 30,000 medical cases that officials examined. Decreases in infections, medicine reactions, and other complications since 2010 have resulted in 2.1 million fewer incidents of harm, 87,000 fewer deaths, and $20 billion in health care savings, the report concluded.
“Those are real people that are not dying, getting infections or other adverse events in the hospital,” said Dr. Patrick Conway, chief medical officer for the Centers for Medicare & Medicaid Services.
Some of the most significant progress was made in lowering the number of infections from central lines inserted into veins – down 72% from 2010. Medical researchers have proven that these infections can be virtually eliminated if doctors and nurses follow a clear set of procedures.
Infections from urinary catheters decreased by 38% and surgical site infections dropped by 18%. In all three cases, the reductions exceeded the goals set by the administration. Dr. Conway noted that hospitals had a financial motivation to cut these infections as they are used to determine whether hospitals get Medicare bonuses and penalties each year.
However, hospitals have not made headway in trimming the numbers of falls or pneumonia cases in patients breathing through mechanical ventilators, the report found. And the rates of adverse drug reactions and complications during childbirth were higher than what the administration estimated they should be for 2014.
Dr. Conway said that complications are difficult to address because they involve tradeoffs that can cause other problems. For instance, he said, hospitals have to balance efforts to reduce falls with the need to help unstable patients improve their ability to walk. “We’ve got to work with providers to figure out what’s the sweet spot that can keep mobilization occurring but decrease the rate of falls,” he said.
Even though overall complication rates were flat, the report found that some types of injuries became less common in 2014. One was the number of blood clots that form after surgery and travel to the lung; those rates dropped by 30% in a year.
Maulik Joshi, an executive at the American Hospital Association, predicted that complications will become even rarer in future years. “Hospitals are working on projects that are just not reflected in these data points,” he said.
But a few conditions became more prevalent in 2014. Infections from methicillin-resistant Staphylococcus aureus increased by 55% to an estimated 17,000 incidents last year. The number of times a catheter punctured a femoral artery during an angiography increased by 25% to 74,000, the report estimated.
“We think we addressed a lot of the areas where there was a strong evidence base on how to improve patient safety,” Dr. Conway said. “We’ll now have to tackle that next wave that has multiple causes.”
Hospital care unaffected by quality payments, GAO finds
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Hospital care unaffected by quality payments, GAO finds
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Medicare’s quality incentive program for hospitals, which provides bonuses and penalties based on performance, has not led to demonstrated improvements in its first 3 years, according to a federal report released Thursday.
The Government Accountability Office examined the Hospital Value-Based Purchasing Program, one of the federal health law’s initiatives to tie payment to quality of care. Earlier this year Medicare gave bonuses to 1,700 hospitals and reduced payments to 1,360 hospitals based on their mortality rates, patient reviews, degree of improvement, and other measurements.
While the payments to a majority of the nation’s hospitals have been affected each year, the audit found the financial effect has been minimal. Most hospitals saw their Medicare payments increase or drop by less than half a percentage point. In the fiscal year that ended Sept. 30, 74% of hospitals fell within that range, with a median bonus of $39,000 and a median penalty of $56,000, according to the analysis.
Safety-net hospitals, which serve more poor patients, tended to do worse than did hospitals overall, but that difference has decreased over the life of the program, the report said. Hospitals with the strongest balance sheets tended to do better than other hospitals did, the report found: Those with a net income margin of more than 5% received average bonuses of 0.23%, while hospitals basically breaking even financially on average did not earn any extra payments.
The Centers for Medicare & Medicaid Services did not respond to the report. Officials have previously stressed that financial incentives like these will have a long-term effect by focusing hospitals more on quality.
The report said that even before the program began in October 2012, hospitals had been improving in how consistently they followed basic clinical guidelines, such as performing blood cultures before giving patients antibiotics. That improvement continued but did not increase with the advent of the financial incentives. The same was true for patient ratings, on such items as the quality of communication from doctors and nurses, and for mortality rates for heart attack patients. Heart failure and pneumonia death rates stayed roughly the same.
“Our analysis found no apparent shift in … quality measure trends during the initial years of the program, but such shifts could emerge over time as the program implements planned changes,” the GAO wrote.
The report noted patient readmission rates began to decline in 2010, when the health law was passed. It said that might be due to a separate Medicare penalty program, also created by the health law, which focuses only on readmission rates. Those penalties will hit 2,592 hospitals over the next 12 months, with the worst performers losing 3% of their regular Medicare payments for each patient stay.
“The conjunction of the drop in hospital readmission rates and the introduction of a financial incentive program targeting those rates provide some additional indication that financial incentives … may, under certain circumstances, promote enhanced quality of care,” the report said.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation. KHN’s coverage of aging and long-term care issues is supported in part by a grant from The SCAN Foundation.
Poll finds overwhelming support for Medicare coverage of end-of-life talks
The public overwhelmingly supports Medicare’s plan to pay for end-of-life discussions between doctors and patients, despite GOP objections that such chats would lead to rationed care for the elderly and ill, a poll released Sept. 30 finds.
About 8 of every 10 people surveyed by the Kaiser Family Foundation – in a nationally representative sample of 1,202 adults – supported coverage by the government or insurers for planning discussions about the type of care patients preferred in the waning days or weeks of their lives. (KHN is an editorially independent program of the foundation.) These discussions can include whether people would want to be kept alive by artificial means even if they had no chance of regaining consciousness or autonomy and whether they would want their organs to be donated. These preferences can be incorporated into advance directives, or living wills, which are used if someone can no longer communicate.
The Centers for Medicare & Medicaid Services earlier this year proposed paying doctors to have these talks with patients. A final decision is due out soon. The idea had been included in early drafts of the 2010 federal health care law, but former Alaska Gov. Sarah Palin and other opponents of the law labeled the counseling sessions and other provisions “death panels” motivated by desires to save money, and the provision was deleted from the bill.
The notion of helping patients prepare for death has support among many doctors, who sometimes see terminal patients suffer from futile efforts to keep them alive. Last year, the Institute of Medicine issued a report that encouraged end-of-life discussions beginning as early as age 16.
The Kaiser poll found that these talks remain infrequent. Overall, only 17% of those surveyed said they had had such discussions with their doctors or other health care professionals, even though 89% believe doctors should engage in such counseling. A third of respondents said they had talked to doctors about another family member’s wishes for how they would want to be cared for at the end of life.
While none of these proposals calls for the cost of care to weigh on these discussions, the final years of life are indeed expensive for America’s health care system. The Dartmouth Atlas of Health Care has calculated that a third of Medicare spending goes to the care of people with chronic illnesses in their last 2 years of life. That is likely to increase as the population of those older than 65 increases. An analysis by the Kaiser foundation found that Medicare spending per person more than doubled from age 70 to 96, where it peaked at $16,145 per beneficiary in 2011.
The Kaiser poll found less public support for a cost-containment provision that did make it into the health law. The “Cadillac tax” begins in 2018 and will impose a tax on expensive insurance that employers provide to their workers. Sixty percent oppose the plan, which economists have long favored as a way to discourage lavish coverage and make people aware that extensive use of Medicare services is linked to premiums.
The poll also found that 57% of people favor repealing the medical device tax, another piece of the health law that Republicans in Congress are trying to repeal. The tax applies to artificial hips, pacemakers and other devices that doctors implant.
The poll was conducted from Sept. 17 through Sept. 23. The margin of error was +/– 3 percentage points.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
The public overwhelmingly supports Medicare’s plan to pay for end-of-life discussions between doctors and patients, despite GOP objections that such chats would lead to rationed care for the elderly and ill, a poll released Sept. 30 finds.
About 8 of every 10 people surveyed by the Kaiser Family Foundation – in a nationally representative sample of 1,202 adults – supported coverage by the government or insurers for planning discussions about the type of care patients preferred in the waning days or weeks of their lives. (KHN is an editorially independent program of the foundation.) These discussions can include whether people would want to be kept alive by artificial means even if they had no chance of regaining consciousness or autonomy and whether they would want their organs to be donated. These preferences can be incorporated into advance directives, or living wills, which are used if someone can no longer communicate.
The Centers for Medicare & Medicaid Services earlier this year proposed paying doctors to have these talks with patients. A final decision is due out soon. The idea had been included in early drafts of the 2010 federal health care law, but former Alaska Gov. Sarah Palin and other opponents of the law labeled the counseling sessions and other provisions “death panels” motivated by desires to save money, and the provision was deleted from the bill.
The notion of helping patients prepare for death has support among many doctors, who sometimes see terminal patients suffer from futile efforts to keep them alive. Last year, the Institute of Medicine issued a report that encouraged end-of-life discussions beginning as early as age 16.
The Kaiser poll found that these talks remain infrequent. Overall, only 17% of those surveyed said they had had such discussions with their doctors or other health care professionals, even though 89% believe doctors should engage in such counseling. A third of respondents said they had talked to doctors about another family member’s wishes for how they would want to be cared for at the end of life.
While none of these proposals calls for the cost of care to weigh on these discussions, the final years of life are indeed expensive for America’s health care system. The Dartmouth Atlas of Health Care has calculated that a third of Medicare spending goes to the care of people with chronic illnesses in their last 2 years of life. That is likely to increase as the population of those older than 65 increases. An analysis by the Kaiser foundation found that Medicare spending per person more than doubled from age 70 to 96, where it peaked at $16,145 per beneficiary in 2011.
The Kaiser poll found less public support for a cost-containment provision that did make it into the health law. The “Cadillac tax” begins in 2018 and will impose a tax on expensive insurance that employers provide to their workers. Sixty percent oppose the plan, which economists have long favored as a way to discourage lavish coverage and make people aware that extensive use of Medicare services is linked to premiums.
The poll also found that 57% of people favor repealing the medical device tax, another piece of the health law that Republicans in Congress are trying to repeal. The tax applies to artificial hips, pacemakers and other devices that doctors implant.
The poll was conducted from Sept. 17 through Sept. 23. The margin of error was +/– 3 percentage points.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
The public overwhelmingly supports Medicare’s plan to pay for end-of-life discussions between doctors and patients, despite GOP objections that such chats would lead to rationed care for the elderly and ill, a poll released Sept. 30 finds.
About 8 of every 10 people surveyed by the Kaiser Family Foundation – in a nationally representative sample of 1,202 adults – supported coverage by the government or insurers for planning discussions about the type of care patients preferred in the waning days or weeks of their lives. (KHN is an editorially independent program of the foundation.) These discussions can include whether people would want to be kept alive by artificial means even if they had no chance of regaining consciousness or autonomy and whether they would want their organs to be donated. These preferences can be incorporated into advance directives, or living wills, which are used if someone can no longer communicate.
The Centers for Medicare & Medicaid Services earlier this year proposed paying doctors to have these talks with patients. A final decision is due out soon. The idea had been included in early drafts of the 2010 federal health care law, but former Alaska Gov. Sarah Palin and other opponents of the law labeled the counseling sessions and other provisions “death panels” motivated by desires to save money, and the provision was deleted from the bill.
The notion of helping patients prepare for death has support among many doctors, who sometimes see terminal patients suffer from futile efforts to keep them alive. Last year, the Institute of Medicine issued a report that encouraged end-of-life discussions beginning as early as age 16.
The Kaiser poll found that these talks remain infrequent. Overall, only 17% of those surveyed said they had had such discussions with their doctors or other health care professionals, even though 89% believe doctors should engage in such counseling. A third of respondents said they had talked to doctors about another family member’s wishes for how they would want to be cared for at the end of life.
While none of these proposals calls for the cost of care to weigh on these discussions, the final years of life are indeed expensive for America’s health care system. The Dartmouth Atlas of Health Care has calculated that a third of Medicare spending goes to the care of people with chronic illnesses in their last 2 years of life. That is likely to increase as the population of those older than 65 increases. An analysis by the Kaiser foundation found that Medicare spending per person more than doubled from age 70 to 96, where it peaked at $16,145 per beneficiary in 2011.
The Kaiser poll found less public support for a cost-containment provision that did make it into the health law. The “Cadillac tax” begins in 2018 and will impose a tax on expensive insurance that employers provide to their workers. Sixty percent oppose the plan, which economists have long favored as a way to discourage lavish coverage and make people aware that extensive use of Medicare services is linked to premiums.
The poll also found that 57% of people favor repealing the medical device tax, another piece of the health law that Republicans in Congress are trying to repeal. The tax applies to artificial hips, pacemakers and other devices that doctors implant.
The poll was conducted from Sept. 17 through Sept. 23. The margin of error was +/– 3 percentage points.
Kaiser Health News is a nonprofit national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.
Medicare yet to save money through ACO model
The Centers for Medicare & Medicaid Services offers the lure of bonuses to health care practitioners who band together as accountable care organizations, or ACOs, to take care of patients. The financial incentives are intended to encourage these doctors, hospitals, nursing homes, and other institutions to keep patients healthy rather than primarily treat illnesses, which is what Medicare payments traditionally have rewarded. ACOs that save a substantial amount get to keep a share of the savings as a bonus.
The Obama administration touts ACOs as one of the most promising reforms in the 2010 federal health care law. The administration set a goal that by the end of 2018, half of Medicare spending currently based on the volume of procedures a doctor or hospital performs will instead be linked to quality and frugality. But so far, the ACO program generally has been a one-way street, with most doctors and hospitals happy to accept bonuses while declining to be on the hook for a share of any excessive costs run up by their patients.
Last year, Medicare paid $60 billion to 353 ACOs to take care of nearly 6 million Medicare beneficiaries. Some ACOs made significant strides in reducing use of hospitals and other costly resources. But patients at 45 percent of groups cost Medicare more than the government had projected based on their patients’ historic costs, records show. After paying bonuses to the strong performers, the ACO program resulted in a net loss of nearly $3 million to the Medicare trust fund, government records show.
“It’s turning out to be tougher to transform care and realign delivery than people had expected,” said Eric Cragun, an analyst with the Advisory Board Company, a consulting group based in Washington.
Medicare officials said most ACOs are still in their infancy and that performances will improve with experience and ultimately save significant sums for Medicare while improving care for beneficiaries. “In the long run we’re shooting to achieve those goals,” Sean Cavanaugh, CMS deputy administrator, said in an interview.
Nonetheless, the results are short of what Medicare projected in 2011 as it launched the program. Those estimates anticipated the government would save between $10 million and $320 million during 2014.
‘Bearing risk is a big leap’
The ACO program’s bottom line has been hurt by the reluctance of most ACOs to accept financial responsibility for their patients. Only 7% of ACOs opted last year for a high-risk/high-reward deal in which they had the potential to earn larger bonuses but would have to reimburse the government should their patients instead cost Medicare more than expected.
The rest of the ACOs opted to avoid the potential of financial punishment even though it meant their potential bonuses would be smaller. The risk aversion proved so widespread that Medicare has given ACOs up to 6 years to participate without fear of penalties, instead of phasing out that option.
“Many of these ACOs are newly formed groups of doctors and hospitals, and bearing risk is a big leap,” Cavanaugh said.
Last year, 196 ACOs saved Medicare money, while 157 ACOs cost more than expected. Medicare ultimately did not realize any savings because it paid out bonuses to 97 ACOs, but only 3 of the costly ACOs had to repay Medicare for losses their patients incurred.
In Oregon, North Bend Medical Center ACO patients cost Medicare $9 million. Spending for those patients was 12% more than projected, the largest gap of any ACO. In Los Angeles, the government spent $20 million, or 11%, more than expected for ACO patients at Cedars-Sinai Medical Care Foundation. That was the largest amount in dollars. Both ACOs had chosen to be exempt from financial penalties.
North Bend dropped out of the program earlier this year.
Cedars-Sinai said its ACO patients ended up more expensive than other previous patients because the hospital added new physician practices specializing in cancer and heart disease, which are among the most costly conditions to treat. In a statement Thursday, Cedars said it unintentionally failed to include those patients in the comparisons it sent to Medicare and was now revising its calculations.
Even some of the ACOs that saved the most money have yet to accept financial risk. Costs for patients at Winchester Community ACO in Massachusetts were 16% less than Medicare estimated. The ACO earned a bonus of $5 million. Catharine Robertson, an executive with Winchester Hospital, said their cost-saving initiatives were created when the ACO was formed. One team at the ACO identified patients as high risk of getting sick and sought to intercede before they ended up requiring hospitalization.
“We’re absolutely thrilled with our success the last few years, but the reality is there’s a lot to learn about population-based management,” she said.
The largest bonus in dollars, $23 million, went to Memorial Hermann Accountable Care Organization in Houston, which was 11% below Medicare’s cost expectations. Christopher Lloyd, the CEO of Memorial Hermann’s ACO, credited its success to a decade’s worth of changes that improved cooperation among physicians and the hospital, as well as the creation of systems to share medical details of patients.
“The ACO when we formed it in 2012 was just an extension of what we were already doing,” Mr. Lloyd said. He said committed ACOs could make the same improvements in 3-4 years. “What took us 10 years to build does not take 10 years to replicate,” he said. Still, Memorial Hermann, like Winchester, is not yet accepting risk.
Difficulties in implementing the program
To wring overall savings for Medicare, the government faces a bind, analysts said. If Medicare makes the potential of repayments mandatory, many existing ACOs may drop out of the program and new ones are less likely to join. If the majority of ACOs continue to risk no financial repercussions, they have less incentive to save the government money. And without showing savings, it will be hard for Medicare to expand the program.
Clif Gaus, president of the National Association of ACOs, said Medicare should be making it easier for ACOs to earn bonuses as they assemble their operations. “Any start-up company, I don’t care who they are, never makes profits in the early years,” Mr. Gaus said. “Starting a health care delivery system is just as hard, if not harder, than starting a Facebook or an Amazon.”
Because Medicare sets its expectations based on national spending averages, “it’s really hard to save money in some parts of the country,” said David Muhlestein, an executive at the consulting firm Leavitt Partners based in Salt Lake City. “We’ve talked to ACOs that have joined the program, started to make changes, and decided that it’s really too much work right now.”
Sharp HealthCare, a well-regarded five-hospital system in San Diego, dropped out of the program last year after concluding it might not be able to avoid penalties. In a financial statement, Sharp said that because Medicare’s assessments are “based on national financial trend factors that are not adjusted for specific conditions that an ACO is facing in a particular region (e.g., San Diego), the model was financially detrimental to Sharp ACO.”
Jeff Goldsmith, a health industry analyst and professor at the University of Virginia who is a longtime ACO critic, said the ACO model is flawed. Consumers do not actively opt to participate in the ACOs and do not share in any savings, so they lack financial incentives to help keep costs down, he said. ACOs also have limited leverage to control the costs incurred by highly paid specialists such as surgeons and cardiologists. Patients in ACOS can still go to any doctor who accepts Medicare’s regular method of paying, in which they receive a set fee based on the nature of the service without regard to its outcome.
“Faux managed care is actually harder to do than real managed care,” Goldsmith said. The ACO program, he said, “has a bad enough reputation in the provider community that is not going to grow sufficiently to replace regular Medicare.”
The Obama administration is more optimistic. The administration said patients are benefiting with better care, as most quality measures Medicare is using to track ACO performance improved between 2013 and 2014.
CMS’s actuaries believe the ACOs are performing better than they appear when compared with the historical benchmarks that the health law established, which CMS has been using. The actuaries employed an alternative method in a report issued last spring, comparing Medicare spending trends in places with ACOs and those without, and concluded that, overall, ACOs were saving money.
Still, ACOs’ appetite for taking risk remains small. The number of ACOs opting for the largest potential bonuses and penalties has shrunk from 32 at the start of the program to 19. Rob Lazerow, an Advisory Board consultant, said, “In a world where ACOs are still optional, CMS still has to make it attractive for providers to want to participate.”
Kaiser Health News is a nonprofit national health policy news service that is part of the Henry J. Kaiser Family Foundation.
The Centers for Medicare & Medicaid Services offers the lure of bonuses to health care practitioners who band together as accountable care organizations, or ACOs, to take care of patients. The financial incentives are intended to encourage these doctors, hospitals, nursing homes, and other institutions to keep patients healthy rather than primarily treat illnesses, which is what Medicare payments traditionally have rewarded. ACOs that save a substantial amount get to keep a share of the savings as a bonus.
The Obama administration touts ACOs as one of the most promising reforms in the 2010 federal health care law. The administration set a goal that by the end of 2018, half of Medicare spending currently based on the volume of procedures a doctor or hospital performs will instead be linked to quality and frugality. But so far, the ACO program generally has been a one-way street, with most doctors and hospitals happy to accept bonuses while declining to be on the hook for a share of any excessive costs run up by their patients.
Last year, Medicare paid $60 billion to 353 ACOs to take care of nearly 6 million Medicare beneficiaries. Some ACOs made significant strides in reducing use of hospitals and other costly resources. But patients at 45 percent of groups cost Medicare more than the government had projected based on their patients’ historic costs, records show. After paying bonuses to the strong performers, the ACO program resulted in a net loss of nearly $3 million to the Medicare trust fund, government records show.
“It’s turning out to be tougher to transform care and realign delivery than people had expected,” said Eric Cragun, an analyst with the Advisory Board Company, a consulting group based in Washington.
Medicare officials said most ACOs are still in their infancy and that performances will improve with experience and ultimately save significant sums for Medicare while improving care for beneficiaries. “In the long run we’re shooting to achieve those goals,” Sean Cavanaugh, CMS deputy administrator, said in an interview.
Nonetheless, the results are short of what Medicare projected in 2011 as it launched the program. Those estimates anticipated the government would save between $10 million and $320 million during 2014.
‘Bearing risk is a big leap’
The ACO program’s bottom line has been hurt by the reluctance of most ACOs to accept financial responsibility for their patients. Only 7% of ACOs opted last year for a high-risk/high-reward deal in which they had the potential to earn larger bonuses but would have to reimburse the government should their patients instead cost Medicare more than expected.
The rest of the ACOs opted to avoid the potential of financial punishment even though it meant their potential bonuses would be smaller. The risk aversion proved so widespread that Medicare has given ACOs up to 6 years to participate without fear of penalties, instead of phasing out that option.
“Many of these ACOs are newly formed groups of doctors and hospitals, and bearing risk is a big leap,” Cavanaugh said.
Last year, 196 ACOs saved Medicare money, while 157 ACOs cost more than expected. Medicare ultimately did not realize any savings because it paid out bonuses to 97 ACOs, but only 3 of the costly ACOs had to repay Medicare for losses their patients incurred.
In Oregon, North Bend Medical Center ACO patients cost Medicare $9 million. Spending for those patients was 12% more than projected, the largest gap of any ACO. In Los Angeles, the government spent $20 million, or 11%, more than expected for ACO patients at Cedars-Sinai Medical Care Foundation. That was the largest amount in dollars. Both ACOs had chosen to be exempt from financial penalties.
North Bend dropped out of the program earlier this year.
Cedars-Sinai said its ACO patients ended up more expensive than other previous patients because the hospital added new physician practices specializing in cancer and heart disease, which are among the most costly conditions to treat. In a statement Thursday, Cedars said it unintentionally failed to include those patients in the comparisons it sent to Medicare and was now revising its calculations.
Even some of the ACOs that saved the most money have yet to accept financial risk. Costs for patients at Winchester Community ACO in Massachusetts were 16% less than Medicare estimated. The ACO earned a bonus of $5 million. Catharine Robertson, an executive with Winchester Hospital, said their cost-saving initiatives were created when the ACO was formed. One team at the ACO identified patients as high risk of getting sick and sought to intercede before they ended up requiring hospitalization.
“We’re absolutely thrilled with our success the last few years, but the reality is there’s a lot to learn about population-based management,” she said.
The largest bonus in dollars, $23 million, went to Memorial Hermann Accountable Care Organization in Houston, which was 11% below Medicare’s cost expectations. Christopher Lloyd, the CEO of Memorial Hermann’s ACO, credited its success to a decade’s worth of changes that improved cooperation among physicians and the hospital, as well as the creation of systems to share medical details of patients.
“The ACO when we formed it in 2012 was just an extension of what we were already doing,” Mr. Lloyd said. He said committed ACOs could make the same improvements in 3-4 years. “What took us 10 years to build does not take 10 years to replicate,” he said. Still, Memorial Hermann, like Winchester, is not yet accepting risk.
Difficulties in implementing the program
To wring overall savings for Medicare, the government faces a bind, analysts said. If Medicare makes the potential of repayments mandatory, many existing ACOs may drop out of the program and new ones are less likely to join. If the majority of ACOs continue to risk no financial repercussions, they have less incentive to save the government money. And without showing savings, it will be hard for Medicare to expand the program.
Clif Gaus, president of the National Association of ACOs, said Medicare should be making it easier for ACOs to earn bonuses as they assemble their operations. “Any start-up company, I don’t care who they are, never makes profits in the early years,” Mr. Gaus said. “Starting a health care delivery system is just as hard, if not harder, than starting a Facebook or an Amazon.”
Because Medicare sets its expectations based on national spending averages, “it’s really hard to save money in some parts of the country,” said David Muhlestein, an executive at the consulting firm Leavitt Partners based in Salt Lake City. “We’ve talked to ACOs that have joined the program, started to make changes, and decided that it’s really too much work right now.”
Sharp HealthCare, a well-regarded five-hospital system in San Diego, dropped out of the program last year after concluding it might not be able to avoid penalties. In a financial statement, Sharp said that because Medicare’s assessments are “based on national financial trend factors that are not adjusted for specific conditions that an ACO is facing in a particular region (e.g., San Diego), the model was financially detrimental to Sharp ACO.”
Jeff Goldsmith, a health industry analyst and professor at the University of Virginia who is a longtime ACO critic, said the ACO model is flawed. Consumers do not actively opt to participate in the ACOs and do not share in any savings, so they lack financial incentives to help keep costs down, he said. ACOs also have limited leverage to control the costs incurred by highly paid specialists such as surgeons and cardiologists. Patients in ACOS can still go to any doctor who accepts Medicare’s regular method of paying, in which they receive a set fee based on the nature of the service without regard to its outcome.
“Faux managed care is actually harder to do than real managed care,” Goldsmith said. The ACO program, he said, “has a bad enough reputation in the provider community that is not going to grow sufficiently to replace regular Medicare.”
The Obama administration is more optimistic. The administration said patients are benefiting with better care, as most quality measures Medicare is using to track ACO performance improved between 2013 and 2014.
CMS’s actuaries believe the ACOs are performing better than they appear when compared with the historical benchmarks that the health law established, which CMS has been using. The actuaries employed an alternative method in a report issued last spring, comparing Medicare spending trends in places with ACOs and those without, and concluded that, overall, ACOs were saving money.
Still, ACOs’ appetite for taking risk remains small. The number of ACOs opting for the largest potential bonuses and penalties has shrunk from 32 at the start of the program to 19. Rob Lazerow, an Advisory Board consultant, said, “In a world where ACOs are still optional, CMS still has to make it attractive for providers to want to participate.”
Kaiser Health News is a nonprofit national health policy news service that is part of the Henry J. Kaiser Family Foundation.
The Centers for Medicare & Medicaid Services offers the lure of bonuses to health care practitioners who band together as accountable care organizations, or ACOs, to take care of patients. The financial incentives are intended to encourage these doctors, hospitals, nursing homes, and other institutions to keep patients healthy rather than primarily treat illnesses, which is what Medicare payments traditionally have rewarded. ACOs that save a substantial amount get to keep a share of the savings as a bonus.
The Obama administration touts ACOs as one of the most promising reforms in the 2010 federal health care law. The administration set a goal that by the end of 2018, half of Medicare spending currently based on the volume of procedures a doctor or hospital performs will instead be linked to quality and frugality. But so far, the ACO program generally has been a one-way street, with most doctors and hospitals happy to accept bonuses while declining to be on the hook for a share of any excessive costs run up by their patients.
Last year, Medicare paid $60 billion to 353 ACOs to take care of nearly 6 million Medicare beneficiaries. Some ACOs made significant strides in reducing use of hospitals and other costly resources. But patients at 45 percent of groups cost Medicare more than the government had projected based on their patients’ historic costs, records show. After paying bonuses to the strong performers, the ACO program resulted in a net loss of nearly $3 million to the Medicare trust fund, government records show.
“It’s turning out to be tougher to transform care and realign delivery than people had expected,” said Eric Cragun, an analyst with the Advisory Board Company, a consulting group based in Washington.
Medicare officials said most ACOs are still in their infancy and that performances will improve with experience and ultimately save significant sums for Medicare while improving care for beneficiaries. “In the long run we’re shooting to achieve those goals,” Sean Cavanaugh, CMS deputy administrator, said in an interview.
Nonetheless, the results are short of what Medicare projected in 2011 as it launched the program. Those estimates anticipated the government would save between $10 million and $320 million during 2014.
‘Bearing risk is a big leap’
The ACO program’s bottom line has been hurt by the reluctance of most ACOs to accept financial responsibility for their patients. Only 7% of ACOs opted last year for a high-risk/high-reward deal in which they had the potential to earn larger bonuses but would have to reimburse the government should their patients instead cost Medicare more than expected.
The rest of the ACOs opted to avoid the potential of financial punishment even though it meant their potential bonuses would be smaller. The risk aversion proved so widespread that Medicare has given ACOs up to 6 years to participate without fear of penalties, instead of phasing out that option.
“Many of these ACOs are newly formed groups of doctors and hospitals, and bearing risk is a big leap,” Cavanaugh said.
Last year, 196 ACOs saved Medicare money, while 157 ACOs cost more than expected. Medicare ultimately did not realize any savings because it paid out bonuses to 97 ACOs, but only 3 of the costly ACOs had to repay Medicare for losses their patients incurred.
In Oregon, North Bend Medical Center ACO patients cost Medicare $9 million. Spending for those patients was 12% more than projected, the largest gap of any ACO. In Los Angeles, the government spent $20 million, or 11%, more than expected for ACO patients at Cedars-Sinai Medical Care Foundation. That was the largest amount in dollars. Both ACOs had chosen to be exempt from financial penalties.
North Bend dropped out of the program earlier this year.
Cedars-Sinai said its ACO patients ended up more expensive than other previous patients because the hospital added new physician practices specializing in cancer and heart disease, which are among the most costly conditions to treat. In a statement Thursday, Cedars said it unintentionally failed to include those patients in the comparisons it sent to Medicare and was now revising its calculations.
Even some of the ACOs that saved the most money have yet to accept financial risk. Costs for patients at Winchester Community ACO in Massachusetts were 16% less than Medicare estimated. The ACO earned a bonus of $5 million. Catharine Robertson, an executive with Winchester Hospital, said their cost-saving initiatives were created when the ACO was formed. One team at the ACO identified patients as high risk of getting sick and sought to intercede before they ended up requiring hospitalization.
“We’re absolutely thrilled with our success the last few years, but the reality is there’s a lot to learn about population-based management,” she said.
The largest bonus in dollars, $23 million, went to Memorial Hermann Accountable Care Organization in Houston, which was 11% below Medicare’s cost expectations. Christopher Lloyd, the CEO of Memorial Hermann’s ACO, credited its success to a decade’s worth of changes that improved cooperation among physicians and the hospital, as well as the creation of systems to share medical details of patients.
“The ACO when we formed it in 2012 was just an extension of what we were already doing,” Mr. Lloyd said. He said committed ACOs could make the same improvements in 3-4 years. “What took us 10 years to build does not take 10 years to replicate,” he said. Still, Memorial Hermann, like Winchester, is not yet accepting risk.
Difficulties in implementing the program
To wring overall savings for Medicare, the government faces a bind, analysts said. If Medicare makes the potential of repayments mandatory, many existing ACOs may drop out of the program and new ones are less likely to join. If the majority of ACOs continue to risk no financial repercussions, they have less incentive to save the government money. And without showing savings, it will be hard for Medicare to expand the program.
Clif Gaus, president of the National Association of ACOs, said Medicare should be making it easier for ACOs to earn bonuses as they assemble their operations. “Any start-up company, I don’t care who they are, never makes profits in the early years,” Mr. Gaus said. “Starting a health care delivery system is just as hard, if not harder, than starting a Facebook or an Amazon.”
Because Medicare sets its expectations based on national spending averages, “it’s really hard to save money in some parts of the country,” said David Muhlestein, an executive at the consulting firm Leavitt Partners based in Salt Lake City. “We’ve talked to ACOs that have joined the program, started to make changes, and decided that it’s really too much work right now.”
Sharp HealthCare, a well-regarded five-hospital system in San Diego, dropped out of the program last year after concluding it might not be able to avoid penalties. In a financial statement, Sharp said that because Medicare’s assessments are “based on national financial trend factors that are not adjusted for specific conditions that an ACO is facing in a particular region (e.g., San Diego), the model was financially detrimental to Sharp ACO.”
Jeff Goldsmith, a health industry analyst and professor at the University of Virginia who is a longtime ACO critic, said the ACO model is flawed. Consumers do not actively opt to participate in the ACOs and do not share in any savings, so they lack financial incentives to help keep costs down, he said. ACOs also have limited leverage to control the costs incurred by highly paid specialists such as surgeons and cardiologists. Patients in ACOS can still go to any doctor who accepts Medicare’s regular method of paying, in which they receive a set fee based on the nature of the service without regard to its outcome.
“Faux managed care is actually harder to do than real managed care,” Goldsmith said. The ACO program, he said, “has a bad enough reputation in the provider community that is not going to grow sufficiently to replace regular Medicare.”
The Obama administration is more optimistic. The administration said patients are benefiting with better care, as most quality measures Medicare is using to track ACO performance improved between 2013 and 2014.
CMS’s actuaries believe the ACOs are performing better than they appear when compared with the historical benchmarks that the health law established, which CMS has been using. The actuaries employed an alternative method in a report issued last spring, comparing Medicare spending trends in places with ACOs and those without, and concluded that, overall, ACOs were saving money.
Still, ACOs’ appetite for taking risk remains small. The number of ACOs opting for the largest potential bonuses and penalties has shrunk from 32 at the start of the program to 19. Rob Lazerow, an Advisory Board consultant, said, “In a world where ACOs are still optional, CMS still has to make it attractive for providers to want to participate.”
Kaiser Health News is a nonprofit national health policy news service that is part of the Henry J. Kaiser Family Foundation.
Medicare is stingy in first year of doctor bonuses
Dr. Michael Kitchell initially welcomed the federal government’s new quality incentives for doctors. His medical group in Iowa has always scored better than most in the quality reports that Medicare has provided doctors in recent years, he said.
But when the government launched a new payment system that will soon apply to all physicians who accept Medicare, Dr. Kitchell’s McFarland Clinic in Ames didn’t win a bonus. In fact, there are few winners: Out of 1,010 large physician groups that the government evaluated, just 14 are getting payment increases this year, according to Medicare. Losers also are scarce. Only 11 groups will be getting reductions for low quality or high spending.
“We performed well, but not enough for the bonus,” said Dr. Kitchell, a neurologist. “My sense of disappointment here is really significant. Why even bother?”
Within 3 years, the Obama administration wants quality of care to be considered in allocating $9 of every $10 Medicare pays directly to providers to treat the elderly and disabled. One part of that effort is well underway: revising hospital payments based on excess readmissions, patient satisfaction, and other quality measures. Expanding this approach to physicians is touchier, as many are suspicious of the government judging them and reluctant to share performance metrics that Medicare requests.
“Without having any indication that this is improving patient care, they just keep piling on additional requirements,” said Dr. Mark Donnell, an anesthesiologist in Silver City, N.M. Dr. Donnell said he only reports a third of the quality measures he is expected to. “So much of what’s done in medicine is only done to meet the requirements,” he said.
The new financial incentive for doctors, called a physician value-based payment modifier, allows the federal government to boost or lower the amount it reimburses doctors based on how they score on quality measures and how much their patients cost Medicare. How doctors rate this year will determine payments for more than 900,000 physicians by 2017.
Medicare is easing doctors into the program, applying it this year only to medical groups with at least 100 health professionals, including doctors, nurses, speech-language pathologists, and occupational therapists. Next year, the program expands Medicare to groups of 10 or more health professionals. In 2017, all remaining doctors who take Medicare – along with about 360,000 other health professionals – will be included. By early in the next decade, 9% of the payments Medicare makes to doctors and other professionals would be at risk under a bill that the House of Representatives passed in March.
The quality metrics used to judge doctors vary by specialty. One test looks at how consistently doctors keep an accurate list of all the drugs patients were taking. Others track the rate of complications after cataract surgery or whether patients received recommended treatments for particular cancers.
There are more than 250 quality measures. Groups and doctors must report a selection – generally nine, which they choose – or else be automatically penalized. This year, 319 large medical groups are having their reimbursements reduced by 1% because they did not meet Medicare’s reporting standards.
Physicians who do report their quality data fear the measures are sometimes misguided, usually a hassle and may encourage doctors to avoid poorer and sicker patients, who tend to have more trouble controlling asthma or staying on antidepressants, for instance.
Dr. Leanne Chrisman-Khawam, a family physician in Cleveland, said many of her patients have difficulty just getting to follow-up appointments, since they must take two or three buses. She said those battling obesity or diabetes are less likely to reform their diets to emphasize fresh foods, which are expensive and less available in poor neighborhoods. “You’re going to link that physician’s payment to that life?” she asked.
Dr. Hamilton Lempert, an emergency physician in Cincinnati, criticized one measure that requires him to track how often he follows up with patients with high blood pressure.
“Most everyone’s blood pressure is elevated in the emergency department because they’re anxious,” Dr. Lempert said. Another metric encourages testing the heart’s electrical impulses in patients with nontraumatic chest pain, which Lempert said has led emergency rooms to give priority to these cases over more serious ones.
“It’s just very frustrating, the things we have to do to jump through the hoops,” he said.
In the first year that doctors are affected by the program, they can choose to forgo bonuses or penalties based on their performance. After that, the program is mandatory. This year, 564 groups opted out, but even if all of them had been included, only 3% would have gotten increases and 38% would have seen lower payments, mostly for not satisfactorily reporting quality measures, Medicare data show.
Smaller groups and solo practitioners are even less likely to report quality to the government. “The participation rates, even though it’s mandated, are just really low,” said Dr. Alyna Chien, an assistant professor at Harvard Medical School. It’s “a level of analytics that just is not typically built into a doctor’s office.”
Dr. Lisa Bielamowicz, chief medical officer of The Advisory Board, a consulting group, predicted more doctors will start reporting their quality scores when the prospect of fines is greater. “They are not going to motivate until it is absolutely necessary,” she said. “If you look at these small practices, a lot of them just run on a shoestring.”
This year’s assessments of big groups were based on patients seen in 2013. A total of $11 million of the $1.2 billion Medicare pays doctors is being given out as bonuses, which translates to a 5% payment increase for those 14 groups getting payment increases this year. That money came from low performers and those that did not report quality measures to Medicare’s satisfaction; they are losing up to 1%.
The exact amount any of these groups lose will depend on the number and nature of the services they provide over the year. This year, 268 medical groups were exempted because at least one of their doctors was participating in one of the government’s experiments in providing care differently.
Officials at the Centers for Medicare & Medicaid Services declined to be interviewed about the program but said in a prepared statement that they have been providing all doctors with reports showing their quality and costs. “We hope that this information will provide meaningful and actionable information to physicians so that they may improve the coordination and integration of the health care provided to beneficiaries,” the statement said.
Kaiser Health News (KHN) is a nonprofit national health policy news service. KHN’s coverage of aging and long-term-care issues is supported in part by a grant from The SCAN Foundation.
Dr. Michael Kitchell initially welcomed the federal government’s new quality incentives for doctors. His medical group in Iowa has always scored better than most in the quality reports that Medicare has provided doctors in recent years, he said.
But when the government launched a new payment system that will soon apply to all physicians who accept Medicare, Dr. Kitchell’s McFarland Clinic in Ames didn’t win a bonus. In fact, there are few winners: Out of 1,010 large physician groups that the government evaluated, just 14 are getting payment increases this year, according to Medicare. Losers also are scarce. Only 11 groups will be getting reductions for low quality or high spending.
“We performed well, but not enough for the bonus,” said Dr. Kitchell, a neurologist. “My sense of disappointment here is really significant. Why even bother?”
Within 3 years, the Obama administration wants quality of care to be considered in allocating $9 of every $10 Medicare pays directly to providers to treat the elderly and disabled. One part of that effort is well underway: revising hospital payments based on excess readmissions, patient satisfaction, and other quality measures. Expanding this approach to physicians is touchier, as many are suspicious of the government judging them and reluctant to share performance metrics that Medicare requests.
“Without having any indication that this is improving patient care, they just keep piling on additional requirements,” said Dr. Mark Donnell, an anesthesiologist in Silver City, N.M. Dr. Donnell said he only reports a third of the quality measures he is expected to. “So much of what’s done in medicine is only done to meet the requirements,” he said.
The new financial incentive for doctors, called a physician value-based payment modifier, allows the federal government to boost or lower the amount it reimburses doctors based on how they score on quality measures and how much their patients cost Medicare. How doctors rate this year will determine payments for more than 900,000 physicians by 2017.
Medicare is easing doctors into the program, applying it this year only to medical groups with at least 100 health professionals, including doctors, nurses, speech-language pathologists, and occupational therapists. Next year, the program expands Medicare to groups of 10 or more health professionals. In 2017, all remaining doctors who take Medicare – along with about 360,000 other health professionals – will be included. By early in the next decade, 9% of the payments Medicare makes to doctors and other professionals would be at risk under a bill that the House of Representatives passed in March.
The quality metrics used to judge doctors vary by specialty. One test looks at how consistently doctors keep an accurate list of all the drugs patients were taking. Others track the rate of complications after cataract surgery or whether patients received recommended treatments for particular cancers.
There are more than 250 quality measures. Groups and doctors must report a selection – generally nine, which they choose – or else be automatically penalized. This year, 319 large medical groups are having their reimbursements reduced by 1% because they did not meet Medicare’s reporting standards.
Physicians who do report their quality data fear the measures are sometimes misguided, usually a hassle and may encourage doctors to avoid poorer and sicker patients, who tend to have more trouble controlling asthma or staying on antidepressants, for instance.
Dr. Leanne Chrisman-Khawam, a family physician in Cleveland, said many of her patients have difficulty just getting to follow-up appointments, since they must take two or three buses. She said those battling obesity or diabetes are less likely to reform their diets to emphasize fresh foods, which are expensive and less available in poor neighborhoods. “You’re going to link that physician’s payment to that life?” she asked.
Dr. Hamilton Lempert, an emergency physician in Cincinnati, criticized one measure that requires him to track how often he follows up with patients with high blood pressure.
“Most everyone’s blood pressure is elevated in the emergency department because they’re anxious,” Dr. Lempert said. Another metric encourages testing the heart’s electrical impulses in patients with nontraumatic chest pain, which Lempert said has led emergency rooms to give priority to these cases over more serious ones.
“It’s just very frustrating, the things we have to do to jump through the hoops,” he said.
In the first year that doctors are affected by the program, they can choose to forgo bonuses or penalties based on their performance. After that, the program is mandatory. This year, 564 groups opted out, but even if all of them had been included, only 3% would have gotten increases and 38% would have seen lower payments, mostly for not satisfactorily reporting quality measures, Medicare data show.
Smaller groups and solo practitioners are even less likely to report quality to the government. “The participation rates, even though it’s mandated, are just really low,” said Dr. Alyna Chien, an assistant professor at Harvard Medical School. It’s “a level of analytics that just is not typically built into a doctor’s office.”
Dr. Lisa Bielamowicz, chief medical officer of The Advisory Board, a consulting group, predicted more doctors will start reporting their quality scores when the prospect of fines is greater. “They are not going to motivate until it is absolutely necessary,” she said. “If you look at these small practices, a lot of them just run on a shoestring.”
This year’s assessments of big groups were based on patients seen in 2013. A total of $11 million of the $1.2 billion Medicare pays doctors is being given out as bonuses, which translates to a 5% payment increase for those 14 groups getting payment increases this year. That money came from low performers and those that did not report quality measures to Medicare’s satisfaction; they are losing up to 1%.
The exact amount any of these groups lose will depend on the number and nature of the services they provide over the year. This year, 268 medical groups were exempted because at least one of their doctors was participating in one of the government’s experiments in providing care differently.
Officials at the Centers for Medicare & Medicaid Services declined to be interviewed about the program but said in a prepared statement that they have been providing all doctors with reports showing their quality and costs. “We hope that this information will provide meaningful and actionable information to physicians so that they may improve the coordination and integration of the health care provided to beneficiaries,” the statement said.
Kaiser Health News (KHN) is a nonprofit national health policy news service. KHN’s coverage of aging and long-term-care issues is supported in part by a grant from The SCAN Foundation.
Dr. Michael Kitchell initially welcomed the federal government’s new quality incentives for doctors. His medical group in Iowa has always scored better than most in the quality reports that Medicare has provided doctors in recent years, he said.
But when the government launched a new payment system that will soon apply to all physicians who accept Medicare, Dr. Kitchell’s McFarland Clinic in Ames didn’t win a bonus. In fact, there are few winners: Out of 1,010 large physician groups that the government evaluated, just 14 are getting payment increases this year, according to Medicare. Losers also are scarce. Only 11 groups will be getting reductions for low quality or high spending.
“We performed well, but not enough for the bonus,” said Dr. Kitchell, a neurologist. “My sense of disappointment here is really significant. Why even bother?”
Within 3 years, the Obama administration wants quality of care to be considered in allocating $9 of every $10 Medicare pays directly to providers to treat the elderly and disabled. One part of that effort is well underway: revising hospital payments based on excess readmissions, patient satisfaction, and other quality measures. Expanding this approach to physicians is touchier, as many are suspicious of the government judging them and reluctant to share performance metrics that Medicare requests.
“Without having any indication that this is improving patient care, they just keep piling on additional requirements,” said Dr. Mark Donnell, an anesthesiologist in Silver City, N.M. Dr. Donnell said he only reports a third of the quality measures he is expected to. “So much of what’s done in medicine is only done to meet the requirements,” he said.
The new financial incentive for doctors, called a physician value-based payment modifier, allows the federal government to boost or lower the amount it reimburses doctors based on how they score on quality measures and how much their patients cost Medicare. How doctors rate this year will determine payments for more than 900,000 physicians by 2017.
Medicare is easing doctors into the program, applying it this year only to medical groups with at least 100 health professionals, including doctors, nurses, speech-language pathologists, and occupational therapists. Next year, the program expands Medicare to groups of 10 or more health professionals. In 2017, all remaining doctors who take Medicare – along with about 360,000 other health professionals – will be included. By early in the next decade, 9% of the payments Medicare makes to doctors and other professionals would be at risk under a bill that the House of Representatives passed in March.
The quality metrics used to judge doctors vary by specialty. One test looks at how consistently doctors keep an accurate list of all the drugs patients were taking. Others track the rate of complications after cataract surgery or whether patients received recommended treatments for particular cancers.
There are more than 250 quality measures. Groups and doctors must report a selection – generally nine, which they choose – or else be automatically penalized. This year, 319 large medical groups are having their reimbursements reduced by 1% because they did not meet Medicare’s reporting standards.
Physicians who do report their quality data fear the measures are sometimes misguided, usually a hassle and may encourage doctors to avoid poorer and sicker patients, who tend to have more trouble controlling asthma or staying on antidepressants, for instance.
Dr. Leanne Chrisman-Khawam, a family physician in Cleveland, said many of her patients have difficulty just getting to follow-up appointments, since they must take two or three buses. She said those battling obesity or diabetes are less likely to reform their diets to emphasize fresh foods, which are expensive and less available in poor neighborhoods. “You’re going to link that physician’s payment to that life?” she asked.
Dr. Hamilton Lempert, an emergency physician in Cincinnati, criticized one measure that requires him to track how often he follows up with patients with high blood pressure.
“Most everyone’s blood pressure is elevated in the emergency department because they’re anxious,” Dr. Lempert said. Another metric encourages testing the heart’s electrical impulses in patients with nontraumatic chest pain, which Lempert said has led emergency rooms to give priority to these cases over more serious ones.
“It’s just very frustrating, the things we have to do to jump through the hoops,” he said.
In the first year that doctors are affected by the program, they can choose to forgo bonuses or penalties based on their performance. After that, the program is mandatory. This year, 564 groups opted out, but even if all of them had been included, only 3% would have gotten increases and 38% would have seen lower payments, mostly for not satisfactorily reporting quality measures, Medicare data show.
Smaller groups and solo practitioners are even less likely to report quality to the government. “The participation rates, even though it’s mandated, are just really low,” said Dr. Alyna Chien, an assistant professor at Harvard Medical School. It’s “a level of analytics that just is not typically built into a doctor’s office.”
Dr. Lisa Bielamowicz, chief medical officer of The Advisory Board, a consulting group, predicted more doctors will start reporting their quality scores when the prospect of fines is greater. “They are not going to motivate until it is absolutely necessary,” she said. “If you look at these small practices, a lot of them just run on a shoestring.”
This year’s assessments of big groups were based on patients seen in 2013. A total of $11 million of the $1.2 billion Medicare pays doctors is being given out as bonuses, which translates to a 5% payment increase for those 14 groups getting payment increases this year. That money came from low performers and those that did not report quality measures to Medicare’s satisfaction; they are losing up to 1%.
The exact amount any of these groups lose will depend on the number and nature of the services they provide over the year. This year, 268 medical groups were exempted because at least one of their doctors was participating in one of the government’s experiments in providing care differently.
Officials at the Centers for Medicare & Medicaid Services declined to be interviewed about the program but said in a prepared statement that they have been providing all doctors with reports showing their quality and costs. “We hope that this information will provide meaningful and actionable information to physicians so that they may improve the coordination and integration of the health care provided to beneficiaries,” the statement said.
Kaiser Health News (KHN) is a nonprofit national health policy news service. KHN’s coverage of aging and long-term-care issues is supported in part by a grant from The SCAN Foundation.