One of the many ways the Patient Protection and Affordable Care Act (PPACA) aims to improve the quality and affordability of the care hospitals and health systems provide is through the Hospital Value-Based Purchasing (VBP) program.
The Hospital VBP program is the Centers for Medicare and Medicaid Services’ (CMS) approach to paying more for high-quality care, and less for low-quality care. Under this program, Medicare will reward hospitals that deliver high-quality care with incentive payments.
For some hospitals, improving clinical performance in the areas covered by the Hospital VBP program will be an extension of their ongoing quality improvement work. However, according to Huron Healthcare experts, clinical performance improvement may be more difficult to implement and sustain – particularly if improvement requires changes in patient care management structures and processes.
To help prepare healthcare providers, Huron Healthcare released Key Healthcare Reform Initiatives: Hospital Value-Based Purchasing Program, which is one in a multi-part briefing series aimed at providing hospitals and health systems with best practices for success in a post-healthcare reform reality. The full briefing is available at: http://www.huronconsultinggroup.com/researchdetails.aspx?articleId=2730
Huron Healthcare executives offered the following insights and recommendations regarding VBP programs:
“Hospitals and health systems which perform well on clinical performance measures usually have clinical organizations with engaged leaders, use their clinical information systems to identify improvement opportunities, and implement patient care management processes based on best practices. Hospitals which exceed benchmarks for quality and safety will be rewarded by value-based purchasing,” said Dr. John T. Kelly, managing director, Huron Healthcare.
“From a nursing perspective, this is a very exciting time in healthcare. Nurses will step up and play key roles as direct care providers, patient advocates, and quality improvement participants to assure their patients receive better care and the organizations where they work thrive. Efforts to provide effective and efficient care are synergistic with nursing clinical ladders and excellence programs such as the American Nurses Credentialing Center’s Magnet Recognition Program,” said Ann Kirby, managing director, Huron Healthcare.
“Most hospitals have at least some resources devoted to improving clinical performance. But in the past, healthcare executives have struggled to link clinical improvements to financial outcomes. They may have crunched the numbers and concluded that reducing their infection rates by a few points wasn’t likely to save them much money. What’s shifting now is that there will be a real cause-and-effect economic impact. If you don’t perform well, Medicare pays you less,” said George Whetsell, managing director, Huron Healthcare.
Huron Healthcare experts say the bottom line is that hospitals and hospital systems must effectively manage clinical performance and patients’ perceptions of care or risk their reputations and financial stability. While reductions in Medicare payments under the Value-Based Purchasing program may appear nominal, given the razor-thin margins on Medicare services, the payment reductions may be significant for some organizations. If the program is effective in reducing Medicare costs and increasing quality, it will be expanded to more medical conditions, putting more and more dollars at risk for low-performing hospitals. Hospitals must begin planning now, as implementation of the new Medicare programs and payment rules are being put into action quickly and will be expanding rapidly.
To receive a copy of Huron Healthcare’s reform briefing series or to speak with one of the Huron Healthcare experts about healthcare reform initiatives or other issues affecting hospitals and health systems, please contact:
About Huron Healthcare
Huron Healthcare partners with clients to provide comprehensive performance improvement solutions that improve quality, increase revenue, reduce expenses, and increase physician, patient, and employee satisfaction across the healthcare enterprise. Clients include national and regional integrated healthcare systems, leading academic medical centers, community hospitals and physician practices. Modern Healthcare ranked Huron Healthcare third on its 2010 list of the top 15 largest healthcare management consulting firms.
About Huron Consulting Group
Huron Consulting Group helps clients in diverse industries improve performance, comply with complex regulations, resolve disputes, recover from distress, leverage technology, and stimulate growth. The Company teams with its clients to deliver sustainable and measurable results. Huron provides services to a wide variety of both financially sound and distressed organizations, including leading academic institutions, healthcare organizations, Fortune 500 companies, medium-sized businesses, and the law firms that represent these various organizations. Learn more at www.huronconsultinggroup.com.
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