Payment Matters: Hospital Pay-for-Quality Has Arrived: Final Value-Based Purchasing Rule Released


On May 6, 2011, the Centers for Medicare and Medicaid Services (CMS) published its Hospital Inpatient Value-Based Purchasing (VBP) program Final Rule in the Federal Register with some modifications from the Proposed Rule. CMS estimates that it will redistribute an estimated $850 million in hospital DRG payments to reward acute care hospitals based on their overall performance on designated quality measures in the VBP program’s first year, fiscal year (FY) 2013. Hospitals should be aware that the performance period for the FY 2013 VBP program begins on July 1, 2011 and ends on March 31, 2012. CMS will notify hospitals of their estimated performance scores and estimated value based incentive adjustment amounts for FY 2013 discharges at least 60 days prior to October 1, 2012. However, CMS will not provide notification to hospitals of the exact amount of their value-based incentive adjustments until November 1, 2012. CMS acknowledged that certain quality measures that CMS initially proposed were “topped out” and such measures were excluded from the Final Rule. Below is a summary of the quality measures, performance scores and VBP incentive payments.

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