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How to Use CMS' Value-Based Programs' Data

Don’t wait for Kaiser Health News to tell you CMS dinged your hospital for having too many readmissions. Start thinking like a mathematician, so you can start doing something about it today.

In January, Kaiser Health News reported that CMS identified 786 hospitals whose Medicare payments will be cut in fiscal 2020 under the Hospital-Acquired Condition Reduction Program (HACRP). Was your hospital on the list? If so, was it a surprise?

If you start thinking more like a mathematician and less like a clinician, you might be able to avoid being on the list again. How, you might ask? The secret to reducing your financial risk is in the data you collect for CMS to use in its three value-based programs, sometimes referred to as revenue-at-risk programs. More importantly, the data also holds the secret to improving the quality and safety of patient care at your hospital, health system or medical practice.

Medisolv is launching a new product that can use that data to forecast your performance and consequent penalties under the three programs. We’ll tell you about that a little later. First, here’s how to unlock the secrets your data holds and win at value-based reimbursement.

Your Medicare dollars depend on your CMS quality measures data

Expand the boxes for a quick refresher on the three value-based programs:

The Hospital-Acquired Condition Reduction Program (HACRP)

CMS launched HACRP in fiscal 2015. Under HACRP, CMS can reduce payments by 1 percent to the 25 percent of eligible hospitals that do the worst on the program’s quality measures, which include safety indicators like pressure ulcers, patient falls and infections. This payment cut occurs in the fiscal year after the performance year. How your hospital performs in calendar year 2020 may affect your payment rate in fiscal 2021.

The Hospital Readmissions Reduction Program (HRRP)

CMS launched HRRP in fiscal 2013. Under HRRP, CMS can reduce payments to any eligible hospital that has an excessive 30-day unplanned readmission rate for six different medical conditions, including heart attacks, heart failure and pneumonia. The payment cut happens in the fiscal year following hospitals’ collective performance over the previous three calendar years. How your hospital performs in 2020 may affect your payment rate in fiscal years 2021, 2022 and 2023. In fiscal 2020, CMS cut payments to nearly 2,600 hospitals by a total of $563 million for having excessive readmission rates the previous three calendar years, according to Kaiser Health News.

The Hospital Value-Based Purchasing Program (HVBPP)

CMS launched HVBPP in fiscal 2013. Under HVBPP, CMS can increase or decrease payments by up to 2 percent to hospitals depending on how well they performed on performance measures in four domains: clinical outcomes; person and community engagement; safety; and efficiency and cost reduction. The financial bonus or penalty comes the fiscal year after the performance year. How your hospital performs in calendar year 2020 may affect your payment rate in fiscal 2021. This past year, more than 1,500 hospitals got a bonus of $1.9 billion in Medicare payments at the expense of other hospitals that missed their HVBPP targets in calendar year 2019, according to CMS.


Why it pays to harness your quality measures data

  • There’s a lot of money at stake. With many hospitals and health systems across the country under tremendous margin pressure, how well you fare in the three CMS value-based programs can make all the difference in how well you do fiscally.
  • You can’t do anything retroactively with your patients that will affect how much CMS is paying you today. That ship sailed one to three fiscal years ago, as those patients have long been discharged.
  • You can, however, change things today that will affect how much CMS will pay you in the future. That ship is still in port. Those patients have yet to arrive in your emergency room or on your floors. Spend time on prospective reviews like predictive and prescriptive analytics. (Predictive analytics tell you what will happen, and prescriptive analytics tell you what should.)

It’s time to do the math on CMS value-based program data

Everything CMS evaluates from all three value-based programs—HACRP, HRRP and HVBPP—is based on math. CMS takes your data, does some calculations and decides whether the results merit a penalty or a bonus, depending on the program. Why let CMS have all the fun while you wait to find out your results? You could take the same data and do the math to know what you need to change to affect the outcome. The data is all publicly available through CMS’ Hospital Compare site, QualityNet, and its latest set of inpatient prospective payment system regulations. 

Or, you could let Medisolv help. We’ve built a brand-new product called Value Maximizer that uses machine learning and predictive modeling to forecast your future years’ payments in these CMS quality programs. The tool inputs the same 29 quality measures that CMS uses across the three programs and combines them with other measures that are unique to each hospital.

The tool also has a dashboard that can tell a hospital how it’s performing and how much it can expect to gain or lose based on current performance in any of the three programs. Additionally, the tool can predict what change will have the biggest impact on a hospital’s revenue gains or losses two years (or more) after the performance year.

Take HACRP, for example. When you do the math, you know what your surgical site infection rate is and how much you need to reduce that rate to lower your penalty. You also know how many hospitals stand between you and making a dent in your numbers, because just like CMS, you calculate your performance relative to the performance of your peers. You know the most efficient route to take to get the best result.

You can do that same exercise for each of the 29 quality measures in the three programs. In essence, you have 29 levers to play with by themselves or in various combinations unique to your own hospital to see what will affect your revenue the most in the future.

Sustainable quality improvement through predictive analytics

Clearly, being able to forecast your revenue-at-risk two or more years into the future based on your current clinical performance is beneficial from a budgeting and financial performance standpoint. If you know you’re projected to lose several hundred thousand dollars in fiscal 2023, you can figure out how to compensate for that—or avoid the loss altogether.

The numbers tell you where you’re deficient and pinpoint opportunities to improve quality and safety, which benefits both your staff and your patients.

The numbers also enable you to assign dollar figures to those deficiencies and opportunities. Those figures set targets for individual quality or safety improvements—such as lowering central line-associated bloodstream infections—and attach specific dollar incentives to each of the improvements for individual executives, departments and clinicians.

Every hospital is challenged with creating a culture of patient safety and quality and, most importantly, sustaining it over time. One of the most effective ways to sustain quality improvement is by aligning it with the right financial incentives.

It’s all there in the numbers. You just have to do the math.   

We were excited to announce the launch of Medisolv’s Value Maximizer Software. It puts the power to predict your performance under CMS’ three revenue-at-risk programs at your fingertips. Change your future and make care safer for patients with the Value Maximizer Software’s predictive analysis.  Request a demo for your hospital


Stay Ahead of the Quality Curve 

Medisolv Can Help

Medisolv’s Value Maximizer software, uses machine learning and predictive modeling to forecast your future years payments in the CMS hospital quality programs (HAC, HVBP, HRRP). Our simulation guides your team on how to optimize your performance to maximize your reimbursements.

Here are some resources you may find useful.



Vicky Mahn-DiNicola, RN, MS, CPHQ

Vicky is the Vice President of Clinical Analytics and Research at Medisolv. She has over 20 years of clinical analytics and product management experience, as well as a strong clinical background in Cardiovascular and Critical Care Nursing, Case Management and Quality Improvement. She has been successful at partnering with innovative thought leaders and executing strategy for new models of care delivery, case and quality management programs, performance measurement and benchmarking.

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