The hot topic of value-based purchasing, or hospital pay-for-performance, is almost certain to be on Congress agenda next yearbut theres no guarantee that lawmakers will enact such a program.
Its expected that the House and Senate will hold hearings to examine and discuss the viability of value-based purchasingthe newest term for paying hospitals and other providers based on a series of performance measures, said Tom Nickels, senior vice president of federal relations at the American Hospital Association.
Whether that turns into legislation, is up in the air, Nickels said.
Thats certainly what CMS acting Administrator Kerry Weems wants. In a meeting with reporters last week, Weems said that value-based purchasing would be a top item for the agency in 2008, part of his aggressive push to improve quality and compliance measures in the Medicare program.
The hope is Congress will seriously consider the report that the agency submitted several months ago on hospital value-based purchasing, Weems said. Under such a program, a percentage of the hospitals base operating payment for each discharge or DRG payment would be contingent on the hospitals actual performance on a specific set of measures.
Hospitals would be scored on measures for clinical quality or process-of-care, outcomes and patient-centered care. Hospitals that are financially strapped are already wondering if they could afford the information technology needed to make such a program work (Dec. 3, p. 6). The program would build on the current hospital quality-reporting program begun in 2005 and would need congressional approval to be enacted.
Leaders on the Senate Finance Committee are likely to take a look at this issue, Nickels said. Finance Chairman Max Baucus (D-Mont.) and the panels ranking member, Chuck Grassley (R-Iowa), had introduced a value-based purchasing bill several years ago, so I dont think theyve backed off the issue.
An aide to Grassley confirmed that this was going to be a priority for the Iowa senator next year. Staff is currently reviewing the CMS value-based purchasing implementation plan, she said.
Even if such a system isnt put into place, Weems said, the agency might go ahead on its own and establish a value-based purchasing model or prototype. At least on paper, this would illustrate to hospitals what they would theoretically get paid if such a program were established, he said.
A former CMS administrator in the meantime said that value-based purchasing and any other type of pay-for-performance initiative will take time to establish. The CMS is in the early stages of implementing this, said Mark McClellan, director of the Engelberg Center for Health Care Reform at the Brookings Institution, in an interview last week. He said that value-based purchasing could work in hospitals, provided that the focus isnt so much on the measures themselves but whether patients are getting quality, cost-efficient care as a result of the program.
Weems said he expects to testify before Congress next year on the value-based purchasing report. In the meantime, the plan is to pilot-test the value-based purchasing concept in nursing homes in the spring, he said.
In other moves, Weems said the agency would continue its state-by-state expansion of the Recovery Audit Contractor program, where Medicare claims are reviewed to identify improper payments to hospitals, and work with Congress on the physician fee schedule fix.
Regarding the Medicare Part D drug benefit, the agency will focus on incorporating more low-income beneficiaries in the program, and improve consumer education for the benefit. In the event theres a problem or a policy change, the agency needs to more clearly communicate those actions to beneficiaries, Weems said.
When asked if he was ever going to be officially confirmed by Congress as the agencys administrator, Weems said he remained hopeful. No specific item has been brought to my attention on why I havent been confirmed.