Value Based Purchasing Hinges on Patient Experience

What Is VBP?

One of the most positively received elements of the Patient Protection and Affordable Care Act (PPACA) has been the newly launched Value Based Purchasing (VBP) program. The main goal of VBP is to compensate hospitals according to their ability to deliver quality healthcare across various care measures. By rewarding the best performers and penalizing the worst, this modified Medicare reimbursement formula should encourage improved care and decreased waste. No one argues that these are admirable goals. Determining the optimal formula is a more controversial matter. And understanding even the basics of VBP can be challenging.

How Will Reimbursement Change?

Only about half of all U.S. hospitals are required to participate. VBP includes about 3,100 acute care hospitals throughout the country, excluding psychiatric, rehab, children’s, and cancer hospitals. For FY 2013, 1% of Medicare reimbursement for all included hospitals will be automatically withheld and pooled by CMS. These hospitals’ performance will be compared to benchmarks and ranked. The pool will then be redistributed, with top performers receiving up to 2% back (twice their withholding), and the worst losing up to 1% (their entire withholding). The amount withheld will gradually increase to a maximum of 2% by FY 2017.

How Is “Performance” Calculated?

For FY 2013, performance will be based on the following two domains. 1. Process of Care Measures indicate how care for certain conditions is delivered (for example, % of heart attack patients given aspirin at arrival). For each measure, hospitals can earn points by exceeding achievement thresholds,1 up to a maximum 10 points by meeting the national benchmark.2 Alternatively, hospitals can earn up to 9 improvement points by exceeding their previous baseline scores. This “either/or” methodology for earning points gives an incentive for lower-performing hospitals to improve, while keeping pressure on top-performers.

2. Experience of Care Dimensions measure patients’ perception of care or satisfaction. Scores are determined through the HCAHPS (Hospital Consumer Assessment of Healthcare Providers and Systems) survey, sent to patients following discharge. Similar to the Process of Care domain, Experience of Care is scored relative to achievement vs. threshold or improvement from baseline. Additionally, up to 20 “bonus” consistency points can be earned (or lost) by maintaining all Experience of Care scores sufficiently above the “floor.”3

For FY 2013, a hospital’s Total Performance Score (TPS) is calculated by combining scores for Process of Care Measures (given 70% weight) and Experience of Care Dimensions (30% weight). For FY 2014, an additional domain will be added for Outcomes Measures (based on mortality statistics), and the TPS will be calculated as 45% Process, 30% Experience, and 25% Outcomes.

Patient Experience

Notice that in 2014, Experience of Care will be given more weight than Outcomes Measures. This has created some controversy. Because all hospitals are compared in a single database, with no accounting for size, type of facility, demographics, patient mix, or complexity, often large, prestigious academic medical centers perform poorly compared to small, rural community hospitals. Critics argue that patient satisfaction is unrelated to clinical outcomes and is therefore a poor measure of quality. In the era of VBP, hospitals will have to tackle the dual challenge of driving clinical success and patient satisfaction.

Experience of Care is broken out into eight equally-weighted dimensions:

• Communication with Nurses
• Communication about Medicines
• Communication with Doctors
• Pain Management
• Cleanliness and Quietness of Hospital Environment
• Responsiveness of Hospital Staff
• Discharge Information
• Overall Rating of Hospital

Cleanliness and Quietness are combined into a single measure, although they appear as two separate questions on the survey, and they are very different aspects of the hospital environment. This could have important implications as hospitals work to improve scores. For example, using multiple workers to clean in a “team approach,” or using loud devices such as vacuums in patient areas can negatively impact quietness with no payoff in improved cleanliness.

Improvement through Understanding

Any plan to address patient experience must be multi-faceted. Patients rarely discriminate between types of caregivers when recalling who communicated well or treated them compassionately. And a bad experience with one aspect of patient experience can have ripple effects on a patient’s memory of the entire hospital stay. A hospital needs to understand its specific challenges as part of the big picture to create meaningful and lasting change.

Crothall Healthcare has designed a holistic approach to improving patient experience that goes beyond the single HCAHPS question directly tied to cleaning quality. Once implemented, these strategies have positive effects that reach beyond the walls of the EVS department and help create engaged patients.

Defining Moments addresses verbal and non-verbal interactions between patients and associates to create lasting positive experiences. Engagement focuses on developing an engaged, motivated team, partnered with Nursing to deliver great patient care. Tailored to Fit leverages Crothall’s analytics tools to create targeted action plans with unit-level specificity to drive ongoing improvement. Finally, Expertise connects our diverse subject matter experts to deliver training, best practices, and support to our nationwide network of managers.

Crothall can help our hospital partners calculate the specific financial impact VBP will have on their reimbursement in 2013. A comprehensive strategy to address patient experience is critical to protect revenues in the age of enhanced pay-for-performance.

 

Source: Medicare Payment Strategy: Dissecting CMS’s Hospital Inpatient Value Based Purchasing and Readmissions Programs. The Advisory Board Company, November 2011

1 Achievement threshold for each measure is the 50th percentile score for all hospitals in the VBP database.
2 National benchmark for each measure is the 95th percentile score for all hospitals in the VBP database.
3 Floor for each dimension is defined as the lowest score in the VBP database (0th percentile).