By Linda Rouse O’Neill
What it means for your acute care customers.
A sales rep’s guide to hospital reimbursements
Last month, we discussed several reimbursement regulations and changes the Centers for Medicare & Medicaid Services (CMS) released for post-acute care customers. Since then, CMS released its final payment rule for hospitals and we want to take this opportunity to cover everything you’ll need to know to help your acute care customers respond to new changes and challenges in the coming year.
CMS continues to raise the quality standards that hospitals must meet to attain Medicare incentives or avoid Medicare penalties related to reduced readmissions, reduced costs, and improved care and outcomes. Hospitals on average will receive a 1.4 percent Medicare payment update for FY 2015 – double the rate that CMS allocated for FY 2014 – but this could be significantly less if customers fail to meet quality and performance program goals mentioned above or meaningful use criteria for electronic health records.
Readmissions
Hospitals exceeding readmission benchmarks for five conditions – heart attack, heart failure, pneumonia, hip or knee arthroplasty, and chronic obstructive pulmonary disease (COPD) – will receive up to a 3 percent reimbursement cut for all Medicare base payments starting Oct. 1, 2014 (FY 2015). The 3% penalty – up from 2% in FY 2014 – is the maximum penalty CMS has planned for the remainder of its readmissions reduction program. However, the agency can continue to add conditions.
CMS plans to add one condition to its program for FY 2017 (October 1, 2016): coronary artery bypass grafts (CABG) readmissions. Now might be a good time to start thinking of whether or not this is a priority area to discuss with your customers.
Value Based Purchasing (VBP)
Starting October 1, 1.5 percent of a hospital’s base Medicare reimbursement is tied to meeting established value based purchasing benchmarks. Depending on whether a hospital outperforms or underperforms the benchmarks, they can earn back their full 1.5 percent or potentially slightly more or less. Outperforming the benchmarks has its rewards for customers: it is estimated that $1.4 billion is available for FY 2015 VBP incentive payments.
Currently 18 measures are used to determine a hospital’s VBP score: seven clinical process of care measures, eight patient satisfaction measures, and three mortality rates. Sales reps should already be looking for creative ways to help customers prepare for and address the new FY 2015 measures: one efficiency measure (Medicare spending per beneficiary), one patient experience of care measure, and two new outcomes measures (blood stream infection and AHRQ Patient Safety Indicator (PSI) composite).
It’s also never too soon to start preparing for 2015 (FY 2016), so make sure that your provider customers are already thinking about CMS’s future VBP plans: adding one process measure on influenza immunizations, and two new healthcare-associated infections measures – catheter-associated urinary tract infection (CAUTI) and surgical site infection (SSI).
Infections
Speaking of infections, starting October 1, hospitals that fall within the top quartile of national infection rates will trigger a 1 percent reduction of their total Medicare reimbursement, separate from potential readmissions and VBP cuts. CMS adopted two infection measurement categories for hospitals: Domain 1 is a composite of eight measurements covering pressure ulcer, accidental injury, and postoperative infection rates, while Domain 2 consists of two healthcare-associated infection (HAC) measures.
Domain 2 is weighted 65 percent of a hospital’s total HAC score, while Domain 1 is weighted 35 percent. You may also want to be sure that your customers are aware of the additional Domain 2 infections to be implemented in FY2016 and FY2017 – surgical site infections, MRSA, and C-Difficile.
The CMS final rule is effective this month, and includes several other details in addition to these highlights. You can learn more about this and other reimbursement rulings by contacting us at HIDAGovAffairs@hida.org or visiting www.HIDA.org.
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