In a new demonstration project with Premier hospitals, CMS officials say they will pay a total of $7 million a year in bonuses to hospitals that score well on 35 quality measures in five clinical areas.
The three-year demonstration will involve 300 of the hospitals participating in Premier, a nationwide organization of not-for-profit hospitals based in San Diego, according to a Thursday release from HHS.
HHS says CMS will award a 2% bonus in Medicare payments to hospitals that perform in the top 10% in quality in five clinical areas--heart attack, heart failure, pneumonia, coronary artery bypass surgery, and hip and knee replacements.
Hospitals in the next 10% will get a 1% bonus, HHS says.
The release says specific measures within the heart attack field, for example, include dispensing aspirin on arrival, smoking cessation counseling and beta-blocker medications. And it says one measure in the pneumonia field is timely administration of antibiotics.
"The costs of this demonstration will be partly offset by reductions in medical costs, especially in reductions of unnecessary hospital readmissions because of better care in the initial inpatient stay," CMS Administrator Tom Scully says in the release.
In a separate release, Richard Norling, chairman and CEO of Premier, says participating hospitals are ready for the project.
"At Premier, we have spent years building databases and the related reporting systems that allow our members to accomplish the first of these tasks," he says.
"Financially rewarding superior outcomes is beyond the reach of Premier and its members. Yet, that is what's necessary to complete the performance improvement process," he adds. "The ability to reward superior outcomes truly closes the loop."