Better Health, Better Care, Lower Costs: Reforming Health Care Delivery
As our nation works to bring health care costs under control, much of the focus is on how to make changes to our health care system that will improve the quality and safety of care and provide measureable savings in the coming decade. The Affordable Care Act makes an historic investment in tools to help transform our health care delivery system over the long run—tools that will reduce and eliminate preventable injuries to patients, reward quality and innovation, and spur adoption of technology that improves care while better aligning payment incentives to reward providers who work to improve care.
The long-term savings from these reforms are not yet being fully realized, but they are setting the stage for a transformation of the way that health care is delivered in the United States, to put us on a path toward a patient-centered system that rewards the quality of care delivered, not just the quantity of services provided.
This fact sheet provides an update on implementations of some of the key reforms to our health care delivery system, through July 27, 2011.
PAYING FOR PERFORMANCE:
- Hospitals. The first large-scale Hospital Value-Based Purchasing Program—which will pay over 3,500 hospitals nationwide according to whether they meet performance standards and how much they improve—takes effect for hospitalizations on October 1, 2012. CMS also would strengthen its current pay-for-reporting program for hospital outpatient departments and—for the first time— extend pay-for-reporting to the ambulatory surgery center setting in 2014, as part of a July proposed payment rule. Data collection would begin as early as 2012.
- Physicians. CMS has proposed to continue to strengthen the Physician Quality Reporting System through the 2012 Physician Fee Schedule as part of CMS’ broader strategy to encourage health care providers to adopt practices that can improve patient care by providing physicians with incentives to voluntarily report quality measurement data to the Agency.
- Medicare Advantage Plans. CMS strengthened the Affordable Care Act’s “five-star” plan bonus system to accelerate and increase the incentives for improvement in the quality of care provided to nearly 12 million beneficiaries.
- Dialysis Facilities. A new End-Stage Renal Disease (ESRD) Quality Incentive Program will, for the first time, tie CMS payments directly to facility performance on quality measures, resulting in better care at a lower cost for nearly 500,000 enrollees with ESRD.
- Home Health Agencies. More than 100 Home Health Agencies that are part of the two-year Medicare Home Health Pay for Performance demonstration are getting nearly $15 million in shared savings from providing better care at lower cost.
PROMOTING BETTER CARE AND PROTECTING PATIENT SAFETY:
- Partnership for Patients. This nationwide initiative will help save 60,000 lives by stopping millions of preventable injuries and complications in patient care over the next three years. Over the next ten years, the Partnership for Patients could reduce costs to Medicare by about $50 billion and result in billions more in Medicaid and private sector savings. The Partnership was announced on April 12, and since then more than 4,500 organizations—including physician and nurses’ organizations, consumer groups, employers and over 2,000 hospitals—have pledged to help achieve the Partnership’s goals of reducing hospital complications and improving care transitions.
As part of the Partnership for Patients, CMS is soliciting applications for a new $500 million Community-Based Care Transitions Demonstration that would support partnerships between hospitals with high rates of readmissions and community-based organizations to help patients make more successful transitions from hospital to home or to another post-hospital setting.
The CMS Innovation Center has also posted a request for bids for state, regional, national, or hospital system organizations to spread best practices that have already been proven to prevent infections in hospitals.
- Accountable Care Organizations. Through the creation of voluntary Accountable Care Organizations (ACOs), health care providers can more easily work together to coordinate care for an individual patient across care settings—including doctors’ offices, hospitals, and long-term care facilities. Medicare will reward ACOs that meet quality performance standards and lower growth in health care costs. By putting patients first, the ACO initiative is estimated to generate $510 million in Medicare savings over three years.
- Expanding Electronic Health Records (EHR). Adoption of electronic health records will make it easier for physicians, hospitals, and others serving Medicare beneficiaries to assess a patient’s medical status and make sure that care is appropriate. They will also help eliminate redundant and costly procedures. Since registration for the EHR incentive programs opened on January 3, 2011, more than 68,000 eligible providers have registered and more than $273.2 million in incentives has been awarded.
- Quality Improvement Organization (QIO) Program. The national QIO network comprises organizations operating in each state, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, whose mission is to spread rapid, large-scale, health-system change. Under a new multi-year contract, QIOs will become key drivers of Affordable Care Act reforms, working with patients, providers, and practitioners across all health care settings and cultural and geographic boundaries to reconfigure the current delivery system into patient-centered care.
ENSURING ALL AMERICANS GET THE RIGHT CARE WHEN THEY NEED IT:
- Saving Lives by Focusing on Prevention. Harmful, costly disease can be prevented – or caught at the earliest, most treatable stages – by making sure more Americans get the routine services they need, when they need them. As a result of the Affordable Care Act, millions of seniors have already received free prevention services from their doctor, including millions of annual wellness visits this year alone.
- Improving Access to Primary Care Doctors and Surgeons. The Affordable Care Act gives most primary care physicians a 10 percent incentive payment for commonly-performed services, such as office visits, performed on or after January 1, 2011. It also gives general surgeons in rural and other shortage areas a 10 percent bonus for performing certain types of surgeries. The projected increases in 2011 from the incentives are $240 million for primary care providers and $10 million for surgeons in shortage areas.
- Coordinating Care for Patients with Medicare and Medicaid. Fifteen states are receiving $1 million each in new federal funding to develop better ways to coordinate care for people with both Medicare and Medicaid, who often have more complex and costly health care needs. Strategies include more flexibility for home and community-based services and improving health IT systems.
Two new grant programs are currently taking states’ applications to test the best ways to pay for care integration for dually-eligible beneficiaries and ways to improve nursing home care so they can stay out of the hospital. CMS is also establishing a technical resource center focusing exclusively on improving care for these high-need, high cost beneficiaries.
- Ensuring Greater Independence for Americans with Disabilities. CMS will distribute over $45 million in grants to states in 2011, and more than $621 million through 2016 to build Medicaid long-term care programs that will help keep people at home and out of institutions.
CRACKING DOWN ON FRAUD AND WASTE:
- Lowering the Cost of Health Care Equipment and Supplies. A stronger competitive bidding program sets new, lower payment rates for medical equipment and supplies. CMS estimates that Medicare and beneficiaries will pay 35 percent less on average for equipment and supplies. The program is expected to save Medicare and its beneficiaries approximately $30 billion over 10 years.
- Avoiding Unnecessary Radiation Exposure for Patients. A new Affordable Care Act demonstration is testing whether using decision support systems can promote appropriate use of imaging technology, to reduce unnecessary radiation exposure and utilization.
- Fighting Fraud. The Affordable Care Act takes landmark steps forward and invests $350 million to improve and enhance the Administration’s ongoing efforts to prevent and detect fraud, and crack down on individuals who attempt to defraud Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP) as well as private insurance, including:
- Tough New Rules and Sentences for Criminals: The Affordable Care Act increases the federal sentencing guidelines for health care fraud offenses by 20-50% for crimes that involve more than $1 million in losses. The law establishes penalties for obstructing a fraud investigation and makes it easier for the government to recapture any funds acquired through fraudulent practices.
- Cutting-Edge Technology: Starting July 1, CMS began using innovative predictive modeling technology to fight Medicare fraud. Similar to technology used by credit card companies, predictive modeling helps identify potentially fraudulent Medicare claims on a nationwide basis, and help stop fraudulent claims before they are paid.
- Enhanced Screening and Other Enrollment Requirements: New enrollment requirements for all Medicare, Medicaid, and CHIP providers and suppliers require some categories of providers and suppliers who have historically posed a higher risk of fraud or abuse to be screened before enrolling in the Medicare or Medicaid programs or CHIP, and allow the Secretary and CMS to take other steps to suspend payments or provider and supplier enrollment if fraud is suspected. This will move Medicare away from a “pay and chase” mode of having to track down fraudulent payments after the fact.
- Increased Coordination of Fraud Prevention Efforts: Many of the Affordable Care Act provisions increase coordination between states, CMS, and its law enforcement partners at OIG and DOJ. The law ensures that fraudulent providers and suppliers cannot move from state to state or between Medicare and Medicaid by requiring all states to terminate anyone who has been terminated by Medicare or by another state.
- Sharing Data to Fight Fraud: Building on the Obama Administration initiatives to improve coordination across the agencies charged with stopping fraud, the law requires certain claims data to be centralized, making it easier for agency and law enforcement officials to identify criminals and prevent fraud on a system-wide basis.
- New Tools to Target High Risk Entities: The Affordable Care Act strengthens the government’s authority to require certain high-risk providers and suppliers to undergo a higher level of scrutiny before enrolling in the program based on the risk of fraud, waste, or abuse they pose to the program.
For a full list of new Affordable Care Act tools to fight fraud, visit www.HealthCare.gov/news/factsheets/2011/03/fraud03152011a.html.
- Reducing the Deficit. The Congressional Budget Office estimated that the Affordable Care Act would reduce the deficit by $143 billion over its first 10 years, while the Medicare Trustees Report for 2010 projected that the new law would extend the life of the Medicare Trust Fund by 12 years, from 2017 to 2029.
HELPING AMERICANS TAKE CONTROL OF THEIR HEALTH:
- Beneficiaries get Written Notice of their Right to Quality Care. Under a proposed rule, issued February 2, 2011, most providers and suppliers would need to inform beneficiaries of their rights to contact state survey agencies and to complain about health-care quality to one of Medicare’s Quality Improvement Organizations. Currently only beneficiaries who are hospital inpatients get information about QIOs.
- Hospital-acquired Conditions. Now—along with other data that’s available on Hospital Compare—beneficiaries can find information on the incidence of serious Hospital-Acquired Conditions (HACs) in individual hospitals. In FY 2015, hospitals with high rates of HACs will see their payments reduced.
- Access to Quality Information. Qualified organizations would have access to Medicare performance reports on hospitals, physicians, and other health care providers, helping consumers and employers make better health care decisions, promoting competition and driving down costs, under a proposed regulation issued in June.
DEVELOPING MEASURES OF HEALTH CARE QUALITY:
- Hospitals. The recent proposed rule for acute care hospital inpatient payment includes proposed measures for the new Readmissions Reduction Program required by the Affordable Care Act and proposes new measures for hospital quality reporting.
- Inpatient Rehabilitation Facilities. Under a proposed rule, IRFs would report in 2012 on two of the nine conditions that are included in the Partnership for Patients initiative, and a third measure under development would address readmissions within 30 days.
- Hospices. As part of Medicare’s 2012 hospice wage index regulation, hospices would begin reporting on quality measures—including a measure on pain management—or face a two percent reduction in their inflation update if they did not submit their reports in 2013.
OTHER SYSTEM-WIDE REFORMS GOING ON NOW:
- System-wide Quality Improvement. Critical reforms already underway include reducing adverse drug events and reducing bed sores in nursing homes; improving cardiac care and outcomes; reducing health disparities; and emphasizing to providers the importance of engaging patients in decisions about their care.
- Physician Quality Reporting and ePrescribing. Nearly 120,000 physicians and other eligible professionals in nearly 12,650 practices reported quality-related data satisfactorily in 2009 through the Physician Quality Reporting System. They received incentive payments totaling more than $234 million. CMS paid $148 million to 48,354 physicians and other eligible professionals under the e-Prescribing Incentive Program in 2009 to promote the adoption of ePrescribing to reduce medication-related errors and identify options for treatment that can lower costs to beneficiaries while producing the desired outcomes.
- New State Authority to Tie Payment to Quality in Medicaid. Under a new Affordable Care Act regulation, state Medicaid programs can reduce or prohibit payments to doctors, hospitals and other health care providers for services that result from certain preventable healthcare acquired illnesses or injuries, just as Medicare is able to do.
- Medicare and Medicaid Innovation Center. The Innovation Center is charged with identifying, testing and ultimately spreading new ways of delivering and paying for care. The new center, which opened its doors on November 17, 2010, is authorized to invest up to $10 billion in initiatives that will have a high “return on investment,” more than paying for itself according to the Congressional Budget Office.
Posted on: July 27, 2011