On August 17, researchers in the Waltham, Mass.-based Global Institute for Emerging Healthcare Practices, a division of the Falls Church, Va.-based CSC, released a white paper entitled “The Hospital Agenda for Accountability.” As Jane Metzger, Caitlin Lorincz, and Marta Arthur, explain in that document, “Accountability for care is already here for any hospital that treats Medicare Inpatient Prospective Payment System (IPPS) patients, regardless of whether the hospital is planning to be part of an Accountable Care Organization” (ACO), under the shared savings program launched earlier this year by the Department of Health and Human Services (HHS) and Centers for Medicare and Medicaid Services (CMS).
In fact, the authors note in their report, three healthcare reform-related programs under Medicare—the Value-Based Purchasing (VBP) Program; the hospital readmissions reduction program; and the hospital-acquired conditions program—will all begin to require that hospital-based organizations provide a very broad range of quality, patient safety, and administrative data that over time could result in significant positive or negative impacts to individual hospitals’ bottom lines. Some of the data points being demanded match those being required under the ACO shared savings program, while others harmonize closely with the meaningful use-related data requirements under the American Recovery and Reinvestment Act/Health Information Technology for Clinical and Economic Health (ARRA-HITECH) program created in February 2009.
What many hospital leaders will find confusing and challenging will be the overlaps in the data demands involved in these various programs, as well as their overall breadth of scope. Such diverse areas as mortality statistics, infections, patient falls, the administration of certain types of drugs, the provision of patient discharge summaries, and patient experience measures. Not surprisingly also, each of these programs involves its own particular complexities, including around the fact that some of the data regimes are based on calendar years and others on fiscal years.
Principal researcher Jane Metzger spoke recently with HCI Editor-in-Chief Mark Hagland regarding the white paper’s findings and the challenges facing healthcare IT leaders in all these areas. Below are excerpts from that interview.
What are the broadest themes in the white paper that you and your team have written?
The paper is really about “accountable care,” in lower-case letters, versus the formal ACO concept under the shared savings program. The thing is that, ever since the passage of the ACA [Accountable Care Act], most of what you read about healthcare reform has been about the ACO program; and that’s pretty understandable, because it requires new organizational structures or partnerships, and really doing things in a different way, and additional IT infrastructures, and it’s really a big deal. But we really think that’s distracted people from a lot of other elements in the Accountable Care Act; because there are three other programs in the ACA. So that was one observation. And the other thing we noted was that when people were writing about healthcare reform, they kept using the future tense. And we noticed that some of the dates didn’t seem all that far in the future.
For example, probably the most significant element is data collection for chart-abstracted measures for the first year of value-based purchasing, one of those three programs, which started on July 1, 2011. So we decided that some of these elements weren’t well-understood. And the ACA is over 1,000 pages and is very complex. These programs under the ACA are on separate timetables, and have different elements to them; and it’s a very complex subject, and a very moving target. So we said we think these three programs—value-based purchasing, the readmissions reduction program, and the hospital-acquired infections penalty program—need to be looked at. So we put together the performance measures for all three programs, and we decided also to sort them by timeframe, by looking at the first year in which measurement for a measure will actually influence reimbursement. That cuts through all these many different applicable dates.
And when we did that, it turned out, as we suspected, that the future is now; and regardless of what happens with the ACO rule and whether hospitals participate in the shared-savings program or not, there is this pretty significant accountability agenda hitting the industry. And none of these other programs are voluntary.
The overlap of the different measures appears significant. They don’t conflict, broadly, do they?
No, they don’t. and there are sort of four parts to the accountability agenda. One is familiar process measures; and they all come from the IQR (inpatient quality reporting) program [the Hospital Inpatient Quality Reporting program, mandated by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003]. And that’s good news, because people have been measuring those things, and they’re familiar measures, and most organizations have been trying to improve those. There are a bunch of claims-based measures focused on readmissions and hospital-acquired conditions involved in that program, for example.
And we’ve had QIO [quality improvement organization] review of Medicare admissions, including some non-payment going on. Then another bucket is the patient experience of care, which also pops up in ACO, though it’s ambulatory, not inpatient. But that whole category is extremely difficult for hospitals to address. It’s very, very hard to move the dial on those measures.
And they’re given a very big weight both under the ACOs proposed rule and under value-based purchasing, right?
Yes, that’s right. And then the fourth area, which starts being measured in FY [fiscal year] 2012 and then affects 2013 reimbursement, is per-beneficiary spending under Medicare, for value-based purchasing. It’s from three days pre-admission to 30 days post-admission, and it’s the first time that per-beneficiary spending is being addressed. And of course, the value-based purchasing program is mandatory. So this is significant. And so, because it’s mandatory, any hospital that takes care of Medicare fee-for-service patients now needs to address this. And these programs affect the overall DRG [diagnosis-related group] payment rate; and they’re designed to be budget-neutral for CMS. And in order to do that, a lot of hospitals are going to be losers—this is all designed that way. And value-based purchasing starts with a 1-percent, across-the-board reduction in every hospital’s DRG payment rate; and then through value-based purchasing, some hospitals will get some of it back.
If you look at page 2 of the report, you’ll see that the three programs all work differently. Under value-based purchasing, everyone starts out with 1 percent down. There are two timelines on this chart; one is the measurement timeline, and one is the reimbursement timeline. The first year of measurement started on July 1 for chart-based measures, and goes until March 2012. So that will give CMS several months’ worth of data, to determine how that will translate into rate changes. So potentially, hospitals are up or down 1 percent; if they earn nothing back from value-based purchasing, they’re down 1 percent; and they can possibly gain back all of what they’re losing. But the ante rises in the next fiscal year, to plus or minus 1.2 percent, and so on. And we’re up to 2 percent in 2017.
Now, things work differently under the hospital readmission reduction program. And if a hospital is unlucky enough to be in the bottom quartile for measured performance, they’re going to lose another 1 percent. And this is guaranteed to be about 25 percent of hospitals.
And won’t many of the hospitals losing 1 percent under value-based purchasing also be likely to lose 1 percent under value-based purchasing?
Correct. We know the most about value-based purchasing, and the least about hospital-acquired conditions (HACs). By 2015, when the HAC program kicks in, low-performing hospitals could potentially lose 3 percent of their Medicare reimbursement because of HACs, on top of 1.5 percent under the value-based purchasing program. In fiscal year 2015, the bottom-performing hospitals will lose 1.5 percent from VBP, 3 percent from the readmissions reduction program, and a further percentage from the HAC program; so it starts adding up; it’s a big deal. So we thought it was important to know what the agenda is, because there’s a lot at stake.
So hospitals really need to very quickly get a handle on all these measures, right?
Yes, and they also have to recognize that the private payers are piling on, in all these areas. This really is only a piece of the accountability agenda that many hospitals are already facing. And this isn’t the kind of situation where you can have quality nurses running around after the fact, sorting through folders full of paper. And we talk about in the white paper, the traditional way that quality improvement has been done in many hospitals is just not going to cut it. So one of the core points of the paper is that “accountable care,” in lower-case letters, is here, and it’s got big implications.
What do you see as the main strategic IT implications of all this?
Probably the best example around IT is around data capture, because data capture is the foundation not just for informed care—that you have a medical record that’s complete—but it’s having the data that you need for measurement, and bringing that measurement into real time, so you can track patients, and if there are gaps in care, take care of those in real time. And all these hospital-acquired conditions—and there are some composite patient safety measures that are pretty wild—you also need IT to set up totally reliable processes to help minimize the occurrence of hospital-acquired conditions.
And right now, most hospitals can’t truly track their readmissions situations, correct?
That’s right; and CMS tracks it based on claims, and it’s for any readmission for any patient in any hospital. And now, if you’re in the lowest-performing quartile across the industry, it’s going to hit your DRG payment rate for all conditions. So the financial impact is potentially huge, and it’s a tough thing, especially for the Medicare population—you’ve got older people, people with lots of conditions. So absolutely—that’s why we say this is a very tough agenda. Not only is a lot of items, but we think the agenda itself is tough.
So getting back to IT, we think that HITECH meaningful use points in the right direction, but that the measures, at least in stage 1, fall short of building truly accountable care. In stage 1 of MU, 80 percent of your patients need an electronic problem list with at least one problem. But in these quality measures, that meaningful use definition of a problem list won’t cut it; it’s got to be all current and relevant problems for all patients. So if this isn’t a wake-up call, I don’t know what is.