3 ways hospitals can get most from value-based purchasing

By Steff Deschenes
10:15 AM

Organizations are beginning to recognize the importance of value-based purchasing. However, one misconception, of this mandatory program under the Patient Protection and Affordable Care Act is that it's something that can be worried about next year.

"Today we're actually in the measurement process for fiscal year 2014. Measurement and payments have already been determined for 2013," said Dave Rhew, MD, senior vice president and chief medical officer of Zynx Health, a company that provides evidence-based clinical decision support solutions to help improve patient outcomes and lower costs. What's being recognized is that what happens today is impacting payments two years down the road. That's the immediate connection not being made,"

The other thing organizations are just starting to get a grip on is how exactly the program works, said Rhew.

Measurement for fiscal year 2013 is broken into two domains: the 12 clinical process of care measures and the eight patient experience of care dimensions.

"What they've done for fiscal year 2014 - what we're measuring today - is that they've added an additional clinical process, totaling 13, and added three measures that assess mortality outcomes related to heart attack, heart failure and pneumonia," Rhew said.

For fiscal year 2015, CMS is looking to add another clinical process of care measure, two more outcomes (with a specific focus on patient safety events) and an additional metric under the new domain of efficiency. This new efficiency metric is defined as Medicare spend per beneficiary, starting three days prior to hospitalization and ending 30 days post-discharge. The lower the spend, the higher the efficiency score.

"Every hospital is then rated on a linear scale where top performers get the highest level of reimbursement and bottom performers do not earn back their payments," explained Rhew. "The program is set up so you have to put in money starting at 1 percent for 2013, 1.25 percent for 2014, 1.50 percent for 2015, 1.75 percent for 2016, and 2 percent for 2017 and subsequent years. For fiscal year 2013, you need to score higher than 41.6 percent to break even, while those folks under the mark will not."

Rhew shared with Healthcare IT News three key ways hospitals can ensure a positive financial impact of value-based purchasing.

1. Create a strategy. Some hospital leaders have a clear strategy of how they're going to approach implementing a successful VBP program, track VBP performance period timelines for each reimbursement year and understand the key clinical processes that determine the VBP quality metrics. Others rely on existing processes, which may not be the best option. Because it's such a competitive program, healthcare organizations need to achieve the best performance possible. "Hospitals will need a plan-do-study-act (PDSA) to better understand how to tweak their processes," commented Rhew.

2. Standardize care delivery. Standardizing care through the use of clinical decision support is imperative. "There's a significant opportunity for improvement in clinical outcomes and efficiency of care if we can start understanding what are all the key clinical processes that have been shown to reduce mortality, cost and readmissions and targeting these process metrics as new goals for standardization," Rhew said.

3. Leverage the investment in your EHR. A major focus continues to be on how healthcare organizations can leverage EHRs to drive down their costs and create the best possible outcomes for the patient. "If we implement EHRs in both hospital and ambulatory settings, we can save upwards of $42 billion a year as a nation," remarked Rhew. "Approximately 80 percent of these savings can be attributed to implementing clinical decision support systems that directly impact hospitalization rates, reduce length of stay and improve  appropriate prescribing of medications and labs." Under VBP, hospitals are now looking at EHRs not only as a means to earn meaningful use dollars, but also as one of the most effective tools that will allow them to perform exceptionally well on VBP metrics, he said.

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