Knowledge Base Article

“I’m late! I’m late! For a very important date!”- The White Rabbit in the 1951 Disney Classic Alice in Wonderland

Much like the White Rabbit, CMS was a day late in the release of the Fiscal Year (FY) 2017 Inpatient Prospective Payment System (IPPS) Final Rule. Late or not, CMS noted in a related Fact Sheet that this rule finalizes policies that continue their commitment to increasingly shift Medicare payments from volume to value. This article focuses on final revisions made to the general acute care hospital Quality Programs.

HOSPITAL INPATIENT QUALITY REPORTING (IQR) PROGRAM

The Hospital IQR Program is a pay-for-reporting program established by the Medicare Prescription Drug, Improvement, and Modernization Act. General acute care hospitals successfully participating in this program and are also meaningful electronic health record (EHR) users will receive approximately 0.95 percent increase in their operating payment rates. The Final Rule finalized changes to this program for FY 2018 and FY 2019 payment determinations.

FY 2018 Program Year: Two Claims Based Measure Refinements

PN Payment: Hospital-Level, Risk-Standardized 30-Day Episode-of-Care Payment Measure for Pneumonia (NQF #2579)

This measure cohort will be expanded to include hospitalizations for patients with

• Principal discharge diagnosis of pneumonia, including not only viral or bacterial pneumonia, but also aspiration pneumonia; and
• Principal discharge diagnosis of sepsis (but not severe sepsis) with a secondary diagnosis of pneumonia (including viral or bacterial pneumonia and aspiration pneumonia) coded as present on admission (POA).

PSI 90: Patient Safety and Adverse Events Composite Measure (NQF #0531): The modified PSI 90 composite was adopted for the IQR Program. See table 3 for further detail.

FY 2019 Program Year: 15 Measures Removed & Four New Measures Added

CMS finalized the proposal to remove 15 measures for the FY 2019 payment determination and subsequent years (see Table 1).

Table 1: Measures Finalized for Removal for the FY 2019 Payment Determination and Subsequent Years

‍Four New Measures to be added to the Hospital IQR Program for the FY 2019 Payment Determination and Subsequent Years.

Table 2: New Measures Finalized for FY 2019 Payment Determination and Subsequent Years

CMS notes that the new “measures capture Medicare payment for services related to the episode procedure and take into account beneficiaries’ clinical complexity as well as geographic payment differences. We proposed these clinical episode-based measures to supplement the Hospital IQR Program’s Medicare Spending per Beneficiary (MSPB) Measure….the measures also support our mission to provide better healthcare for individuals, better health for populations, and lower costs for healthcare.”

In response to stakeholder concerns that these measures overlap with the Medicare Spending Per Beneficiary (MSPB) Measure, CMS notes “that unlike the overall MSPB measure, the clinical episode-based payment measures assess payment variation at the procedure level and only include services that are clinically related to the named episode procedure (for example, the spinal fusion measure includes inpatient admissions for “medical back problems” that occur following the initial spinal fusion procedure since the admission is likely a result of complications from the initial procedure).”

HOSPITAL VALUE BASED PURCHASING (VBP) PROGRAM

The Act instructs the Secretary to reduce the base operating DRG payment amount for a hospital for each discharge in a fiscal year by an applicable percent to fund this budget neutral program. CMS indicates in Table 16A of the Final Rule that the estimated amount available for value-based incentive payments to hospitals for FY 2017 is approximately $1.8 billion. Actual amounts will be displayed in Table 16B that is expected to be posted in October of this year.

FY 2019 Program Year: New Domain Name and Expansion of location for CAUTI and CLABSI

The Patient-and-Caregiver-Centered Experience of Care/Care Coordination Domain will become simply the Person and Community Engagement Domain.

The NHSN (National Health Safety Network) CAUTI (Catheter-Associated Urinary Tract Infection) and CLABSI (Central Line-Associated Blood Stream Infections) outcome measures will include select ward (non-ICU) locations. “This expansion of the CAUTI and CLABSI measures aligns with the Hospital IQR Program. It also aligns with the HAC Reduction Program, which adopted the expansion of the CAUTI and CLABSI measures beginning with its FY 2018 program year (80 FR 49576 through 49578).”

FY 2021 Program Year: Two New Condition-Specific Payment Measures and Expansion of a 30-Day Mortality Measure Cohort

Two New Measures

Hospital-Level, Risk-Standardized Payment Associated with a 30-Day Episode-of-Care for Acute Myocardial Infarction (AMI) (NQF #2431), and

Hospital-Level, Risk-Standardized Payment Associated with a 30-Day Episode-of-Care for Heart Failure (HF) (NQF #2436).

Expansion of 30-Day-PN Mortality Cohort

Also for the FY 2021 Program Year, CMS finalized expansion of the cohort used for the 30-Day-PN Mortality measure to include patients with a principal discharge diagnosis of pneumonia, patients with a principal diagnosis of aspiration pneumonia and patients with a principal diagnosis of sepsis with a secondary diagnosis of pneumonia coded as present on admission (POA).

FY 2022 Program Year: CMS finalized the addition of Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate (RSMR) Following CABG Surgery (NQF #2554) (MORT-30-CABG) measure.

HOSPITAL ACQUIRED CONDITIONS (HAC) REDUCTION PROGRAM

This program creates an incentive for reducing the incidence of HACs by adjusting payments to hospitals in the worst performing quartile for HACs. CMS finalized the following five changes to the existing HAC Reduction Program policies:

• Clarified data requirements for Domain 1 (PSI-90),
• Established National Health Safety Network (NHSN) Centers for Disease Control and Prevention (CDC) Healthcare Associated Infection (HAI) data submission requirements for newly opened hospitals,
• Established performance periods for the FY 2018 and 2019 HAC Reduction Program,
• Adopted the refined Patient Safety Indicator (PSI) 90: Patient Safety for Selected Indicators Composite Measure (NQF #0531) beginning with the FY 2018 payment determination.
• Changed the Program scoring methodology from the current decile-based scoring to a continuous scoring methodology.

FY 2018 Program Year: Finalized Refinements to PSI 90

• First, the name of the PSI 90 measure will change to “Patient Safety and Adverse Events Composite: (NQF #0531).
• Second, the modified PSI 90 measure will include three new indicators (PSI-09, PSI-10 and PSI-11),
• Third, two Indicators will be re-specified in the modified PSI 90.
• PSI-12 Perioperative Pulmonary Embolism (PE) or Deep Vein Thrombosis (DVT) Rate no longer includes ECMO procedures in the denominator or isolated deep vein thrombosis (DVT) of the calf veins in the numerator.
• PSI 15 Accidental Puncture and Laceration Rate is now limited to discharges with an abdominal/pelvic operation, rather than including all medical and surgical discharges.
• Fourth, PSI-07 Central venous catheter-related blood stream infections rate will be removed in the modified PSI 90.
• Fifth, weighting of component indicators will be based not only on volume of each patient safety and adverse events, but also the harms associated with the events.

PSI 90: To Expand from 8 to 10 Indicators for FY 2018 Program

Table 3: PSI 90: Patient Safety and Adverse Events Composite (NQF #0531) for FY 2018

‍HOSPITAL READMISSIONS REDUCTION PROGRAM (HRRP)

This program requires a reduction to a hospital’s based operating DRG payment to account for excess readmissions associated with the applicable conditions. For FY 2017 and subsequent years, a hospital’s potential reduction will be based on a risk-adjusted readmission rate during a three-year period for the following six conditions:

• Acute Myocardial Infarction (AMI),
• Heart Failure (HF),
• Pneumonia (PN),
• Chronic Obstructive Pulmonary Disease (COPD),
• Total Hip Arthroplasty/Total Knee Arthroplasty (THA/TKA), and
• New Condition for FY 2017 (pursuant to prior rulemaking): All-Cause, Unplanned Readmission Following Coronary Artery Bypass Graft (CABG) Surgery (inclusion of this condition was finalized in the FY 2015 IPPS/LTCH Final Rule).

CMS is updating the public reporting policy so that excess readmission rates will be posted to the Hospital Compare website as soon as feasible following the hospitals’ preview period.

More Than Half a Billion Dollars in Readmission Penalties for FY 2017

Set to begin October 1, 2016, Jordan Rau of Kaiser Health News (KHN)reports that readmission penalties are set to reach a new high of more than half a billion dollars in payments being withheld in the coming fiscal year. To see if and how much your hospital will be penalized you can get the data in KHN’s Article Medicare's Readmission Penalties Hit New High.

Resources

CMS Fact Sheet Announcing release of 2017 IPPS Final Rule: https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2016-Fact-sheets-items/2016-08-02.html

2017 IPPS Final Rule (Display copy): https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2017-IPPS-Final-Rule-Home-Page-Items/FY2017-IPPS-Final-Rule-Regulations.html?DLPage=1&DLEntries=10&DLSort=0&DLSortDir=ascending