Medicare Pay Cuts for Poor Readmission Scores Begin

Cheryl Clark, for HealthLeaders Media , October 1, 2012

He adds that quality is maintained by allowing employees to see those results on a monthly basis.  "We know if we're doing things right, those scores take care of themselves."  He adds that Lincoln perhaps has an advantage because it is physician-owned, "and from a quality standpoint, it's easy for us to work with physicians because they have a vested interest in the outcome."

One element of note is that according to the "dry run" statistics listing the best performing VBP hospitals, nearly all are small hospitals or specialty hospitals, with no more than 30 beds. And that holds true for the top performing readmission hospitals too.

Weil says that new measures are being applied to the formula in coming years, and with those new measures will come a different lineup of winners and losers, especially as the formula that determines best and worst is adjusted.

"We believe the results are equitable in that about the same number of hospitals win versus lose," he says. "However, we need to watch carefully over time to determine if particular classes of hospitals, such as (those providing care as part of) the safety net, are disproportionately penalized."

Of course, for both the value-based purchasing incentive payments and readmissions penalties, stakes rise next year based on new, and more up-to-date, performance periods.  For readmissions, the penalty increases to up to 2%. And the value-based purchasing incentive pool grows from 1% of Medicare base DRG to 1.25%

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