Medicare unveiled rules late last week for how federal officials plan to reallocate 1% of hospital spending to pay for performance rather than sheer volume. That sliver of spending amounts to $850 million that Medicare will pay out based on quality and patient satisfaction criteria completed last week.
It's quality time
My colleague, Maureen McKinney, with contributions from Rich Daly and Andis Robeznieks, noted in a story published Monday the quality payouts won praise from patient advocates but received a more mixed response from the industry.
Christine Bechtel, who spoke during a press conference as the rules were released, called the rules a much-needed attack on a problem widely acknowledged by health policy experts as the budget-breaking flaw in healthcare finance.
“Today's payment system is riddled with perverse incentives that reward high volume and high profit-margin services, regardless of value, outcomes or appropriateness,” said Bechtel, who represented the Campaign for Better Care during a press conference to announce the criteria.
Dr. Donald Berwick, who leads the agency that oversees Medicare and Medicaid, told reporters Medicare paid $4.4 billion in 2009 on care for patients harmed in hospitals and another $26 billion on patients who returned to hospitals within a month of their release.
“And my feeling continues to be that the best way for us to arrive at sustainable costs for the healthcare system is precisely through the improvement in quality of care.” Berwick said. “It's the modern and best approach to the sustainability of healthcare.”
Berwick said federal officials need to start buying quality if the nation wants to control healthcare spending.
“One of the tools for doing that is to foster higher quality care by shifting the payment emphasis from paying for how much you do, to paying for how well you do, or more importantly even, how well your patient does,” he said.
Recent research suggests avoidable harm to patients may be more prevalent than previously believed.
Medicare will cut its Medicare hospital spending by 1% across the board in 2013 to pay bonuses based on 13 measures released last week. As McKinney noted, that will increase within four years to 2%.
Medicare will also soon stop paying for some heart attack, heart failure and pneumonia patients who return to the hospital shortly after leaving, Berwick said. Hospitals also face penalties should they fail to adopt information technology and prevent healthcare associated infections.
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