Association of the position of a hospital-acquired condition diagnosis code with changes in medicare severity diagnosis-related group assignment

CONTEXT

Incentives to improve quality include paying less for adverse events, including the Centers for Medicare and Medicaid Services' policy to not pay additionally for events classified as hospital-acquired conditions (HACs). This policy is controversial, as variable coding practices at hospitals may lead to differences in the inclusion and position of HACs in the list of codes used for Medicare Severity Diagnosis-Related Group (MS-DRG) assignment.

OBJECTIVE

Evaluate changes in MS-DRG assignment for patients with an HAC and test the association of the position of an HAC in the list of International Classification of Diseases, 9th Revision (ICD-9) diagnosis codes with change in MS-DRG assignment.

DESIGN AND SETTING

Retrospective analysis of patients discharged from hospital members of the University HealthSystem Consortium's Clinical Data Base between October 2007 and April 2008. Comparisons were made between the MS-DRG assigned when the HAC was not included in the list of ICD-9 diagnosis codes and the MS-DRG that would have been assigned had the HAC code been included in the assignment.

RESULTS

Of the 7027 patients with an HAC, 13.8% changed MS-DRG assignment when the HAC was removed. An HAC in the second position versus third position or lower was associated with a 40-fold increase in the likelihood of MS-DRG change.

CONCLUSIONS

The position of an HAC in the list of diagnosis codes, rather than the presence of an HAC, is associated with a change in MS-DRG assignment. HACs have little effect on reimbursement unless the HAC is in the second position and patients have minor severity of illness.

Medicare and Medicaid programs; modifications to the Medicare and Medicaid Electronic Health Record (EHR) Incentive Program for 2014 and other changes to EHR Incentive Program; and health information technology: revision to the certified EHR technology definition and EHR certification changes related to standards. Final rule

This final rule changes the meaningful use stage timeline and the definition of certified electronic health record technology (CEHRT) to allow options in the use of CEHRT for the EHR reporting period in 2014. It also sets the requirements for reporting on meaningful use objectives and measures as well as clinical quality measure (CQM) reporting in 2014 for providers who use one of the CEHRT options finalized in this rule for their EHR reporting period in 2014. In addition, it finalizes revisions to the Medicare and Medicaid EHR Incentive Programs to adopt an alternate measure for the Stage 2 meaningful use objective for hospitals to provide structured electronic laboratory results to ambulatory providers; to correct the regulation text for the measures associated with the objective for hospitals to provide patients the ability to view online, download, and transmit information about a hospital admission; and to set a case number threshold exemption for CQM reporting applicable for eligible hospitals and critical access hospitals (CAHs) beginning with FY 2013. Finally, this rule finalizes the provisionally adopted replacement of the Data Element Catalog (DEC) and the Quality Reporting Document Architecture (QRDA) Category III standards with updated versions of these standards.

Accountability and primary healthcare

This paper examines the accountability structures within primary healthcare (PHC) in Ontario; in particular, who is accountable for what and to whom, and the policy tools being used. Ontario has implemented a series of incremental reforms, using expenditure policy instruments, enforced through contractual agreements to provide a defined set of publicly financed services that are privately delivered, most often by family physicians. The findings indicate that reporting, funding, evaluation and governance accountability requirements vary across service provider models. Accountability to the funder and patients is most common. Agreements, incentives and compensation tools have been used but may be insufficient to ensure parties are being held responsible for their activities related to stated goals. Clear definitions of various governance structures, a cohesive approach to monitoring critical performance indicators and associated improvement strategies are important elements in operationalizing accountability and determining whether goals are being met.

Approaches to accountability in long-term care

This paper discusses the array of approaches to accountability in Ontario long-term care (LTC) homes. A focus group involving key informants from the LTC industry, including both for-profit and not-for-profit nursing home owners/operators, was used to identify stakeholders involved in formulating and implementing LTC accountability approaches and the relevant regulations, policies and initiatives relating to accountability in the LTC sector. These documents were then systematically reviewed. We found that the dominant mechanisms have been financial incentives and oversight, regulations and information; professionalism has played a minor role. More recently, measurement for accountability in LTC has grown to encompass an array of fiscal, clinical and public accountability measurement mechanisms. The goals of improved quality and accountability are likely more achievable using these historical regulatory approaches, but the recent rapid increase in data and measurability could also enable judicious application of market-based approaches.

A tale of two cities? The heterogeneous impact of Medicaid managed care

Evaluating Accountable Care Organizations is difficult because there is a great deal of heterogeneity in terms of their reimbursement incentives and other programmatic features. We examine how variation in reimbursement incentives and administration among two Medicaid managed care plans impacts utilization and spending. We use a quasi-experimental approach exploiting the timing and county-specific implementation of Medicaid managed care mandates in two contiguous regions of Kentucky. We find large differences in the relative success of each plan in reducing utilization and spending that are likely driven by important differences in plan design. The plan that capitated primary care physicians and contracted out many administrative responsibilities to an experienced managed care organization achieved significant reductions in outpatient and professional utilization. The plan that opted for a fee-for-service reimbursement scheme with a group withhold and handled administration internally saw a much more modest reduction in outpatient utilization and an increase in professional utilization.

The Patient-Centered Medical Home and Meaningful Use: a challenge for better care

This article discusses and illustrates the alignment between the National Committee for Quality Assurance's Patient-Centered Medical Home and Meaningful Use. In addition to the various overlaps, there is also significant discussion about Patient-Centered Medical Home and Meaningful Use as well as their distinct requirements. With impending deadlines for Meaningful Use and potential penalties being imposed, this article provides a layout of dates, stages, and incentive payments and penalties for Meaningful Use, and discusses how obtaining Patient-Centered Medical Home recognition could be beneficial to achieving Meaningful Use.

[Lump sum payment system in psychiatry and psychosomatics: concomitant research - quo vadis?]

The new lump sum payment scheme for psychiatric and psychosomatic services is coming into force in 2013. This constitutes another step on the way to performance-based financial compensation of inpatient and day hospital treatment in psychiatric and psychosomatic hospitals in Germany. This fundamental change needs to be accompanied by scientific evaluation with regards to its effects. This article reflects on the legal foundations of such evaluations and the current progress of preparation. Furthermore, own approaches for analysing the effects of the new finance scheme are presented.

Medicare and Medicaid programs: hospital outpatient prospective payment and ambulatory surgical center payment systems and quality reporting programs; Hospital Value-Based Purchasing Program; organ procurement organizations; quality improvement organizations; Electronic Health Records (EHR) Incentive Program; provider reimbursement determinations and appeals. Final rule with comment period and final rules

: This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2014 to implement applicable statutory requirements and changes arising from our continuing experience with these systems. In this final rule with comment period, we describe the changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. In addition, this final rule with comment period updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program, the ASC Quality Reporting (ASCQR) Program, and the Hospital Value-Based Purchasing (VBP) Program. In the final rules in this document, we are finalizing changes to the conditions for coverage (CfCs) for organ procurement organizations (OPOs); revisions to the Quality Improvement Organization (QIO) regulations; changes to the Medicare fee-for-service Electronic Health Record (EHR) Incentive Program; and changes relating to provider reimbursement determinations and appeals.

Assessing the impact of rural provider services mix on the Primary Care Incentive Payment Program

Key Findings. (1) Based on analysis of 2009 Medicare claims data, more than 70% of rural primary care physicians (PCP) and non-physician practitioners (NPP) qualify for payments under the Primary Care Incentive Payment Program (PCIP) threshold (i.e., meet the > 60% of allowable Medicare charges). (2) The average incentive payment for qualifying rural PCPs would result in an additional $8,000 in Medicare patient revenue per year. For qualifying NPPs, the result is an additional $3,000 in Medicare patient revenue per year. (3) Only 9% of non-qualifying rural primary care providers were within 10 percentage points of the minimum threshold (60%) of Medicare allowed charges to qualify for PCIP payments.

Funding alternatives in EHR adoption: beyond HITECH incentives and traditional approaches

The meaningful use incentives under HITECH may be inadequate to address the financial challenges many hospitals face in implementing electronic health records (EHRs). Hospitals can fill the capital gap between EHR costs and available funds by exploring other potential funding sources. These sources include additional grants, funding permissible under EHR regulations, vendor financing, and tax benefits under IRS Section 179.

Accountable care organizations: benefits and barriers as perceived by Rural Health Clinic management

INTRODUCTION

Rural Health Clinics (RHCs) have served the primary healthcare needs of the medically underserved in US rural areas for more than 30 years. As a new model of healthcare delivery, the Accountable Care Organization (ACO) offers potential opportunities for addressing the healthcare needs of rural populations, yet little is known about how the ACO model will meet the needs of RHCs. This article reports on the results of a survey, focus groups, and phone interviews with RHC management personnel on the subject of benefits of and barriers to RHC participation in ACOs.

METHODS

Survey research, focus groups, and phone interviews were used to gather and analyze the opinions of RHCs' management about the benefits of and barriers to ACO participation. The study population consisted of all 2011 RHCs in Region 4 (Southeastern USA; as designated by the Department of Health and Human Services). California RHCs were used for comparison. Themes and concepts for the survey questionnaire were developed from recent literature. The survey data were analyzed in two stages: (1) analyses of the characteristics of the RHCs and their responses; and (2) bivariate analyses of several relationships using a variety of statistics including analysis of variance, Pearson's χ² and likelihood χ². Relationships were examined between the RHCs' willingness to join ACOs and the respondent clinic's classification (as provider-based or independent). In addition, willingness to join ACOs among Region 4 RHCs was compared with those in California. Finally, in order to gain a broader understanding of the results of the survey, focus groups and phone interviews were conducted with RHC personnel.

RESULTS

It was found that the ACO model is generally unfamiliar to RHCs. Approximately 48% of the survey respondents reported having little knowledge of ACOs; the focus group participants and interviewees likewise reported a lack of knowledge. Among respondents who were knowledgeable about ACOs, the most frequently citied potential benefit of ACOs (58%) was improved patient quality of care, followed by a focus on the patient (54%). More than half of the respondents (53%) cited 'financing' as a deterrent to RHC participating in ACOs. Many (43%) reported that their clinic had inadequate capital to improve their information technology systems. Another 51% cited legal and regulatory barriers.

CONCLUSIONS

While the ACO model was unfamiliar to many of the RHC study participants, many suggested that ACOs may promote the quality of health care for RHC patients and their communities. If, on the other hand, RHCs are not provided the necessary technical assistance or not valued as ACO partners, ACOs may not improve the services that RHCs provide. As the ACO model evolves, the authors will determine whether it will benefit RHCs and their patients, or how the ACO must be modified to accommodate the unique needs of RHCs.

Readmission reduction has begun and the penalties will escalate

Two-thirds of hospitals in the United States are losing reimbursement on each Medicare discharge as a result of their performance on the Centers for Medicare & Medicaid readmission reduction program--and the penalties and diagnoses included will only escalate. Hospitals and case managers have to make a paradigm change and focus not only on moving patients through the continuum but keeping them from returning to the hospital, some experts say. Reach out to post-acute providers and make sure that they have the information they need to care for patients at the next level of care and that patients aren't receiving follow-up calls from multiple sources. Analyze all readmissions to determine why patients came back and take steps to improve your processes.

How Colorado, Minnesota, and Vermont are reforming care delivery and payment to improve health and lower costs

Colorado, Minnesota, and Vermont are pioneering innovative health care pay­ment and delivery system reforms. While the states are pursuing different models, all three are working to align incentives between health care payers and providers to better coordi­nate care, enhance prevention and disease management, reduce avoidable utilization and total costs, and improve health outcomes. Colorado and Minnesota are implementing accountable care models for Medicaid beneficiaries, while Vermont is pursuing multipayer approaches and moving toward a unified health care budget. This synthesis describes the common drivers of reform across the states, lessons learned, and opportunities for federal administrators to help shape, support, and promote expansion of promising state initiatives. It also synthesizes strategies and lessons for other states considering payment and delivery reforms. The accompanying case studies describe the states' efforts in greater detail.

Hospital reimbursement incentives: is there a more effective option?--Part II

As discussed in Part I of this article, hospital executives in Canada, Germany, and the United States manage their facilities' resources to maximize the incentives inherent in their respective reimbursement system and thereby increase their bottom line. It was also discussed that an additional supply of available hospitals, physicians, and other services will generate increased utilization. Part II discusses how the Patient Protection and Affordable Care Act of 2010 will eventually fail since it neither controls prices nor utilization (e.g., imaging, procedures, ambulatory surgery, discretionary spending). This article concludes with the discussion of the German multipayer approach with universal access and global budgets that might well be a model for U.S. healthcare in the future. Although the German healthcare system has a number of shortfalls, its paradigm could offer the most appropriate compromise when selecting the economic incentives to reduce the percentage of the U.S. gross domestic product expenditure for healthcare from 17.4% to roughly 12.0%.

Understanding how the Physician Quality Reporting System affects primary care physicians

The Physician Quality Reporting System (PQRS) uses a combination of payment incentives and adjustments to promote reporting of quality information by eligible professionals who satisfactorily report data on quality measures for covered Physician Fee Schedule services furnished to Medicare Part B Fee-for-Service beneficiaries. Physicians should become familiar with the PQRS core measures to maintain compliance with the Centers for Medicare & Medicaid Services. Adherence to these basic guidelines will allow physicians to not only maximize their income, but also increase quality of care, decrease complications, and decrease healthcare expenditures.

Health information technology: revisions to the 2014 edition electronic health record certification criteria; and Medicare and Medicaid programs; revisions to the Electronic Health Record Incentive Program. Interim final rule with comment period

The Department of Health and Human Services (HHS) is issuing this interim final rule with comment period to replace the Data Element Catalog (DEC) standard and the Quality Reporting Document Architecture (QRDA) Category III standard adopted in the final rule published on September 4, 2012 in the Federal Register with updated versions of those standards. This interim final rule with comment period also revises the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs by adding an alternative measure for the Stage 2 meaningful use (MU) objective for hospitals to provide structured electronic laboratory results to ambulatory providers, correcting the regulation text for the measures associated with the objective for hospitals to provide patients the ability to view online, download, and transmit information about a hospital admission, and making the case number threshold exemption for clinical quality measure (CQM) reporting applicable for eligible hospitals and critical access hospitals (CAHs) beginning with FY 2013. This rule also provides notice of CMS's intention to issue technical corrections to the electronic specifications for CQMs released on October 25, 2012.

Medicare program; end-stage renal disease prospective payment system, quality incentive program, and bad debt reductions for all Medicare providers. Final rule

This final rule updates and makes revisions to the end-stage renal disease (ESRD) prospective payment system (PPS) for calendar year (CY) 2013. This rule also sets forth requirements for the ESRD quality incentive program (QIP), including for payment year (PY) 2015 and beyond. In addition, this rule implements changes to bad debt reimbursement for all Medicare providers, suppliers, and other entities eligible to receive Medicare payment for bad debt and removes the cap on bad debt reimbursement to ESRD facilities. (See the Table of Contents for a listing of the specific issues addressed in this final rule.)

Payer mix and EHR adoption in hospitals

Payers are known to influence the adoption of health information technology (HIT) among hospitals. However, previous studies examining the relationship between payer mix and HIT have not focused specifically on electronic health record systems (EHRs). Using data from the Nationwide Inpatient Sample and the American Hospital Association Annual Survey, we examine how Medicare, Medicaid, commercial insurance, and managed care caseloads are associated with EHR adoption in hospitals. Overall, we found a weak relationship between payer mix and EHR adoption. Medicare and, separately, Medicaid volumes were not associated with EHR adoption. Furthermore, commercial insurance volume was not associated with EHR adoption; however, a hospital located in the third quartile of managed care caseloads had a decreased likelihood of EHR adoption. We did not find empirical evidence to support the hypothesis that payer generosity and other indirect mechanisms influence EHR adoption in hospitals. The direct incentives embedded in the Health Information Technology for Economic and Clinical Health Act may have a positive influence on EHR adoption--especially for hospitals with high Medicare and/or Medicaid caseloads. However, it is still uncertain whether the available incentives will offset the barriers many hospitals face in achieving meaningful use of EHRs.

Preparing for impact. Many hospitals will struggle to escape or absorb penalty for readmissions

October brings the beginning of a program hospitals around the country have been anxiously awaiting--a program that will penalize them for too-high readmission rates. Many fear the economics of the program will drive independent, community hospitals to join systems. "We are the hospitals that are least able to effect change, and we're being asked to do the most," says Stephen Estes, of Rockcastle Regional Hospital and Respiratory Care Center.

The impact of health reform on the Medicare Advantage program: realigning payment with performance

The Affordable Care Act enacts a new payment system for private health plans available to Medicare beneficiaries through the Medicare Advantage (MA) program. The system, which is being phased in through 2017, aims to (1) reduce the excess pay­ments received by private plans relative to per capita spending in traditional Medicare, and (2) reward plans that earn high performance ratings. Using 2009 data, this issue brief pres­ents analysis of the distributional impact on MA plan payments of these new policies as if they had been fully implemented in that year. We find that, when the polices [sic] are in place, they will bring overall MA plan payments nationwide down from 114 percent to 102 per­cent of what spending would have been for the same enrollees if they had been enrolled in traditional Medicare. While payments will vary across the nation, high-performing MA plans stand to benefit from this new arrangement.

Medicare and Medicaid programs; electronic health record incentive program--stage 2. Final rule

This final rule specifies the Stage 2 criteria that eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs) must meet in order to qualify for Medicare and/or Medicaid electronic health record (EHR) incentive payments. In addition, it specifies payment adjustments under Medicare for covered professional services and hospital services provided by EPs, eligible hospitals, and CAHs failing to demonstrate meaningful use of certified EHR technology (CEHRT) and other program participation requirements. This final rule revises certain Stage 1 criteria, as finalized in the July 28, 2010 final rule, as well as criteria that apply regardless of Stage.