CMS issues draft of value-based purchasing rule

Value-based purchasing just took a step closer to becoming a reality on Friday when CMS issued a proposed rule that spells out how a new hospital value-based purchasing program will work.

Hospitals that do well on quality measures that relate to clinical processes and their patients' experience, as well as those that improve their performance on the measures, will get higher payments under the program mandated by the Affordable Care Act. The higher a hospital's performance or improvement during a performance period for a fiscal year, the higher the hospital's value-based incentive payment for the fiscal year.

The program applies to Medicare payments under the Inpatient Prospective Payment System for inpatient stays at more than 3,000 acute-care hospitals, and to payments for discharges from October 1, 2012 on, according to the press release.

The proposed rule includes proposed measures for the hospital value-based purchasing program, performance standards for the program, a scoring scheme and proposals for how scores will translate into value-based incentive payments for hospitals in FY 2013.

CMS proposes a "performance period" that begins July 1, 2011 and ends March 31, 2012 for the FY 2013 hospital value-based purchasing payment evaluation. In future years, CMS anticipates using a full year as the performance period. CMS will accept comments on the proposed rule until March 8, 2011, and will respond to them in a final rule to be issued later this year.

"Value-based purchasing repositions Medicare from an observer of nationwide hospital quality to a formidable force in shaping quality going forward," CMS Administrator Donald Berwick said in a statement.

To learn more:
- read the press release
- here's the fact sheet
- read the proposed rule, details and all

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