PAY-FOR-PERFORMANCE: IMPLICATIONS FOR PROVIDERS

In our last article we discussed where and how P4P is being implemented, and key issues that it raises. In this article we focus on the implications for your organization. Hospitals and health systems need to start preparing now for pay-for-performance (P4P), even if they are not immediately facing P4P initiatives. The federal government has made it clear that a significant amount of Medicare and Medicaid payments will fall under P4P over the next five to 10 years. As P4P becomes more common, it will increasingly have implications that extend beyond reimbursement. Quality data is already being made public on the DHHS “Hospital Compare” website www.hospitalcompare.hhs.gov. Eventually this kind of public report may influence both patient and physician choices, as well as payers’ purchasing decisions. In addition, P4P standards, especially those from CMS, may be read by the courts as establishing an accepted standard of care, creating a new challenge for risk management. Here are some steps you can take to prepare your organization for P4P.

ESTABLISH A CROSS-DISCIPLINARY STRUCTURE FOR ADDRESSING PAYMENT AND QUALITY ISSUES

Under P4P, hospital and health system finance become increasingly dependent on clinical data to maximize reimbursement. Finance will have to understand and monitor the progress of efforts to meet and/or improve performance on quality criteria, which will require a continuous and interdisciplinary approach throughout the organization. A structure should be created to bring together nursing and medical leadership, finance and the medical records department on a consistent basis to design, implement and track initiatives geared toward meeting quality goals.

BE READY FOR NEW DATA COLLECTION EFFORTS

When DRG-based reimbursement was initiated, many hospitals took several years to maximize reimbursement for their Medicare patients because they lacked a rigorous system to code all diagnoses. To prevent a repeat of that experience, hospitals and health systems should be putting the appropriate infrastructure in place now to be ready to capture clinical treatment details. To document performance, even organizations with electronic medical records (EMRs) need to verify the completeness of data in the records, well before P4P payment systems go into effect. If there is no EMR, chart audit must be used for data collection. Unlike typical audit situations, P4P requires capturing data from 100% of the relevant records. With the limited range of diagnoses and conditions that are now the focus of P4P, DGA experience suggests that chart audit will require hiring one or two full-time people per hospital. A simple database, such as an Access system, can meet the need for recording data.

BUILD INFRASTRUCTURE TO SUPPORT QUALITY INITIATIVES

Whether electronic or manual, record systems can be part of the effort to improve quality performance. EMR systems can prompt clinician response and recording of data relevant to specified criteria. If data entered into an emergency room EMR indicates a possible MI, the system can ask clinicians whether the patient has received a thrombolytic and/or aspirin. Manual data collection forms and workflow can raise awareness of quality criteria, prompt appropriate action and simplify subsequent manual data collection.

SUPPORT PHYSICIANS IN HANDLING QUALITY INITIATIVES

Your physicians may be facing commercial P4P initiatives such as the Integrated Healthcare Initiative in California. Even if they are not, they do face CMS initiatives, and their ability to handle these initiatives matters to your organization. CMS recently announced it will be gathering quality data from physicians through the Physician Voluntary Reporting Program.