"These forms of problems in quality cost money and increase suffering. Medicare spent an estimated $4.4 billion in 2009 to care for patients who had been harmed in hospitals. And readmissions, many of which are unnecessary, cost another $26 billion. So this is one of those areas where improvement of quality and reduction in cost go hand in hand."
CMS administrator Don Berwick said that the many comments from providers received in recent months were taken into account, including concerns about the weight given to patient experience. However, administration officials said that they wanted to give appropriate weight to the patient's input.
CMS will reward or penalize 3,500 hospitals paid under the Inpatient Prospective Payment System on the basis of their ability to provide higher quality care starting in October, 2012.
The new rules were required under section 3001 of the Patient Protection and Affordable Care Act, although details awaited a final review by CMS.
The final rules call for the first year's measurement to be based on 12 clinical process of care measures and scores recorded under the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS). In Fiscal 2014, CMS will include three mortality outcome measures, eight hospital acquired condition measures and two composite measures set by the Agency for Healthcare Research and Quality.
Scores will be assessed for hospitals' achievement as well as improvement.
In a fact sheet released Friday, CMS said that for scoring on achievement, "hospitals will be measured based on how much their current performance differs from all other hospitals' baseline period performance.
Points will then be awarded based on the hospital's performance compared to the threshold and benchmark scores for all hospitals. Points will only be awarded for achievement if the hospital's performance during the performance period exceeds a minimum rate called the 'threshold,' which is defined by CMS as the 50th percentile of hospital scores during the baseline period.