A proposed CMS pilot program that would pay more to participating hospitals for reaching certain quality thresholds may also have to pay somewhat less to hospitals that don't reach those thresholds, a CMS spokesperson says.
The CMS proposal, which would be Medicare's first pay-for-performance initiative and is limited to hospitals in the Premier group purchasing organization, was not intended to pay lower-performing hospitals less, the spokesperson says.
The spokesperson, who was confirming a report in the Wall Street Journal today, says the Bush administration's Office of Management and Budget, which must sign off on the plan, is insisting that that low-performing hospitals lose some funding in the third year of the project.
OMB's argument, he says, is that the project must be budget-neutral, so that extra spending is complemented by cuts somewhere else.
The spokesperson says CMS will have no formal announcement about the program unless and until it is approved.
Ken Inchausti, spokeperson for San Diego-based Premier, which represents more than 200 hospitals, says Premier is enthusiastic about the plan while also expressing concern about punishing low-performers with a loss of funds.
The Wall Street Journal reports that quality thresholds in the program might include how quickly patients with pneumonia get antibiotics or what percentage of heart-attack patients get beta blockers at discharge. It adds that hospitals that meet the thresholds would get 1% or 2% more in Medicare payments.
OMB officials did not return phone calls today.