The health care industry is increasingly facing payment pressures, especially from the shift to value-based medicine - high-quality care that is also cost effective.

DOTmed News recently had the opportunity to interview Jill Rathbun on this subject. She is a Managing Partner at Galileo Consulting Group, in Arlington, VA.

DOTmed News: The Medicare program recently released the data on individual hospital value-based payment and hospital-acquired condition scores, so why are so many hospitals facing decreased Medicare reimbursements in FY 2015?

JR: There are policies in the FY 2015 Final Medicare Inpatient Prospective Payment System Rule where there are penalties against a hospital's FY 2015 increase based on their performance. When these penalties are combined, together, it leads to larger reductions in overall Medicare payments to hospital for inpatient services than in previous years. First, the Affordable Care Act mandates a reduction of .2 percent to the market basket update for acute inpatient hospitals in FY 2015.

To adjust for coding intensity/documentation, the Centers for Medicare and Medicare Services (CMS) is taking a .8 percent reduction as part of the continuing process to recover $11 billion by 2017 to satisfy the requirements under the American Taxpayer Relief Act of 2012.

There is also the Hospital Readmissions Reduction Program where the maximum reduction is increasing 3 percent. Hospitals are going to receive those cuts if they have large numbers of readmissions for patients with heart attack, heart failure, pneumonia, chronic obstructive pulmonary disease, and hip/knee arthroplasty. The Centers for Medicare and Medicaid Services is also proposing to add another new readmission measure beginning in FY 2017: readmissions for coronary artery bypass graft (CABG) surgical procedures.

Then there's the Hospital-Acquired Condition (HAC) Reduction program, a financial incentive program for hospitals to improve patient safety by applying a one percent payment reduction to the Medicare allowables of hospitals that rank in the lowest performing quartile relative to a national average of HACs acquired during an applicable hospital stay.  HACs are conditions that patients did not have upon admission to a hospital, but that developed during the hospital stay. HACs that the hospitals are being measured on include: Pressure Ulcers; Iatrogenic Pneumothorax; Central Venous Catheter-related bloodstream infections; Postoperative Hip fracture; Postoperative Pulmonary Embolism or Deep Venous Thrombosis; Postoperative Sepsis; Postoperative Wound Dehiscence; Accidental Puncture or Laceration; Central Line-Associated Blood Stream Infection (CLABSI); and Catheter-Associated Urinary Tract Infection (CAUTI).

And, finally there is the hospital value-based purchasing (VBP) for FY 2015 with its increase to 1.5 percent of base operating DRG payment amounts to all participating hospitals that will go into the "pool," that hospitals can "win back," with delivery of high-quality, cost -care. The total estimated amount available for value-based incentive payments in FY 2015 is approximately $1.4 billion.  The measures that are part of this program can be found on the Centers for Medicare and Medicaid Services Website at http://www.cms.gov/hospital-value-based-purchasing.



DOTmed News: Is it all bad news for hospitals?

JR: For those hospitals that provide high-quality, cost-effective care per the requirements of the Value-Based Purchasing program, there is the opportunity to have more money come back to your institution versus the 1.5 percent of Medicare allowables that the hospital contributed to the pool.

Also, hospitals can institute new and additional clinical protocols and practices such that they are not in the bottom 25% regarding having the highest numbers of HACs that would mean a 1 percent reduction from that program. They can also creative collaborative relationships with other providers in their communities to help support patients in their homes, post an admission, to be more successful under the hospital readmissions program.

DOTmed News: Is there anything else in the 2015 Final IPPS rule or anything else coming down the pipeline, especially concerning imaging, that you think is important for people to know about?
 
JR: We see an enhanced focus in the FY 2015 IPPS rule regarding patient safety and there is a large role for imaging to play in providing better patient care. One of these areas is in regard to vascular access and the insertion of catheters into a patient's body. Three of the hospital acquired conditions that are also part of quality measures in the value-based purchasing program are Iatrogenic Pneumothorax; Central Venous Catheter-related bloodstream infections; and Central Line-Associated Blood Stream Infection (CLABSI) and they can be avoided with the adoption of a protocol that requires ultrasound guidance with all venous access procedures.
 
DOTmed News: In your opinion, what is one area where hospitals could easily focus to improve quality?
 
JR: CMS continues to accept nominations of additional conditions that met the requirements for the HAC program - high volume and high cost.

Iatrogenic Pneumothorax with thoracentesis is a condition in the Medicare acute care, inpatient setting that is both high cost and high volume. In a review of the FY 2011 MedPAR data, Direct Research, LLC found that more than 30,000 iatrogenic pneumothorax were caused by something other than venous catheterization. In addition, a study conducted by the United Biosource Corporation using the Premier Hospital Data Set and published in CHEST in 2013 demonstrated that an iatrogenic pneumothorax caused by a thoracentesis increased a patient's length of stay by 1.4 days and their cost by almost $2,800.

An iatrogenic pneumothorax caused during a thoracentesis procedure could be reasonably prevented through the application of evidence-based guidelines regarding the use of ultrasound guidance when performing a thoracentesis. The American College of Emergency Physicians in their criteria compendium for emergency ultrasound imaging, states that procedural ultrasound to evaluate for and/or drain with ultrasound guidance or localization pleural effusion (thoracentesis) is a standard practice.

Paracentesis, a common procedure used in the management of ascites in patients with cirrhosis, can cause hemorrhagic complications during the procedure, due to needle puncture of local vessels.

In a prospective, randomized clinical trial, emergency medicine physicians successfully performed paracentesis in 95% of patients under ultrasound guidance.1 While only 61% of patients were successfully managed using the traditional technique.

Adding these two conditions to the HAC Reduction Program would lead to higher quality, better patient care.
 
DOTmed News: What else is happening to hospitals?

JR: There are the CY 2015 Medicare Hospital Outpatient Prospective Payment System and the Medicare Physician Fee Schedule Final Rules that were released on October 31, 2014. Both rules have changes regarding increased emphasis on quality reporting and the hospital outpatient payment rule continues to expand packaging for procedures with costs less than $100 that are performed on the same day as another procedure in a hospital emergency room or a hospital outpatient clinic.


Jill Rathbun can be reached at jill_rathbun@galileogrp.com