Summary
This memorandum provides an overview of key Medicare hospital quality reporting and payment programs, including their recent developments and significant upcoming changes. We begin with a brief outline of these programs, noting for example the Centers for Medicare and Medicaid Services’ (CMS) early experience with quality reporting-focused initiatives, such as the Hospital Inpatient Quality Reporting (IQR) Program. Building on the Hospital IQR Program, the Affordable Care Act (ACA) implemented a slate of reforms that incentivize value-based care via a number of hospital pay-for-performance programs. These include: the Hospital Readmissions Reduction Program (HRRP); the Hospital Value Based Purchasing (VBP) Program; and the Hospital Acquired Condition (HAC) Reduction Program, highlighted in this issue brief.
As detailed more fully in section III, CMS has taken a number of steps to instill greater transparency and accuracy with respect to hospital quality data. This is evidenced, in part, by the upcoming inclusion of overall hospital quality star ratings on the Hospital Compare website. Further, the Department of Health and Human Services (HHS) and collaborative partners are examining possible risk-adjustment of certain measures for socioeconomic status (SES) – a topic we will more thoroughly examine in an upcoming issue brief. The results of this work are sure to have profound implications on Medicare quality measurement and payment methodologies.