Medicare Hospital Value-Based Purchasing Proposed Rule Reports and Analysis

1. Medicare Hospital Value-Based Purchasing Proposed RuleReports and Analysis February 15, 2011

2. Mandatory Medicare Delivery System Reform

3. Voluntary Medicare Delivery System Reform

4. Value-Based Purchasing Expansion to Other Payment Settings Implement VBP pilot programs for inpatient rehabilitation, inpatient psychiatric, LTC, cancer hospitals, and hospice Implement VBP for inpatient hospitals Submit plans for Ambulatory Surgical Centers VBP (Jan 1, 2011) Submit plans for SNF and Home Health VBP (Oct. 1, 2011/FFY 2012) FY 2011 2006 2012 2013 2015 2016 2017 2005 FY Implement physician VBP modifier for specific physicians and physician groups Physician payment modifier applied to all physicians, groups and other eligible practitioners Establish a CAH and small volume rural hospital VBP demonstration

5. VBP Provisions of the ACA

6. Goal of Value-Based Purchasing

7. ACA Section 3001: Hospital Inpatient Value-Based Purchasing Incentive Program

8. Funded by Medicare IPPS payment reductions: 1.0% reduction in FFY 2013, increasing each year by .25% to 2.0% for FFY 2017 and beyond Budget-neutral: each year’s pool fully distributed to hospitals in that same year Payment adjustments applied to base operating amount: excluding IME, DSH, low-volume adjustments, and outliers ACA – Funding of VBP

9. ACA – Required VBP Measures

10. ACA – VBP Performance Standards

11. ACA – VBP Incentive Payments

12. Proposed Baseline Period (reflects quality data from Dec. 2010 Hospital Compare release --most recent release) ACA – Timeline for First-Year Implementation of VBP Proposed Performance Period (will reflect quality data from Dec. 2012 Hospital Compare release) Release of Final Rule (by law, VBP performance standards must be published 60-days prior to start of performance period) Medicare IPPS payment adjusted based on hospital performance

13. CMSValue-Based Purchasing Proposed RuleProposed Quality Measures

14. Proposed VBP Quality Measures

15. Proposed Weighting of Measures SCORE VBP To be determined

16. Proposed FFY 2013 VBP – Process Measures

17. Measures Proposed for Exclusion from FFY 2013 VBP

18. Proposed FFY 2013 VBP – Patient Experience of Care Measures Measured using the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey • Modifications to HCAHPS on Hospital Compare: • “cleanliness and quietness” – combined • “would you recommend this hospital?”- not included

19. Proposed FFY 2014 VBP - Outcomes Measures

20. Possible Measures for Future Program Years

21. Proposed Process for Adding Measures to VBP Program

22. CMSValue-Based Purchasing Proposed RuleProposed Scoring Methodology

23. Proposed Timeframes for FFY 2013 VBP

24. Proposed Standards for Process Domain

25. Example of Process Domain Scoring Hospital score in performance period: 0.70 Hospital score in base period: 0.21 From CMS Proposed Rule

26. SampleHospitalVBP Process Domain Score Calculation

27. Sample Hospital VBP Process Score Calculation

28. Proposed Standards for Patient Satisfaction Domain

29. Example of Patient Satisfaction Domain Scoring Hospital score in performance period: 64th percentile Hospital score in base period: 42nd percentile From CMS Proposed Rule

30. HCAHPS Consistency Points

31. HCAHPS Consistency Examples

32. Sample Hospital VBP HCAHPS Calculation

33. Sample Hospital VBP HCAHPS Calculation

34. Exclusions

35. Calculation of VBP Score

36. CMS’ Proposed Payout Function

37. Sample Hospital VBP Payment Incentive Calculation

38. Issues for Comments

39. Contact Information: Contact your State Association or: Gloria Kupferman gkupferm@hanys.org (518) 431-7968 Kevin Krawiecki kkrawiec@hanys.org (518) 431-7710