October 2006

CMS Releases Quality Measures for Use in Physician Reporting Program

Majority of the Nation’s Eligible Hospitals Report Quality of Care Data

Medicare Adds Performance-Based Payments for Physicians

Feds Help Pave Way for E-Health Technology

CMS Releases Quality Measures for Use in Physician Reporting Program

CMS has published a list of 86 quality measures that the agency expects to have available at the beginning of 2007 for its Physician Voluntary Reporting Program (PVRP).

CMS said it plans to select a subset of the measures for use in the reporting program for 2007 "in order to achieve an appropriate balance in measures to be reported by different specialties." The list of measures to be used in the program will be posted before Jan. 1, 2007, the agency said in a fact sheet released Oct. 17.

The list of quality measures released Oct. 17 covers 32 of 39 physician specialties, CMS said, adding that it continues working with specialties that have yet to develop quality measures.

The measures include such actions as providing a beta blocker for a prior myocardial infarction, assessment of elderly individuals for falls, prescribing antidepressant medication during the acute phase for patients with a new episode of major depression, and use of anticoagulant for patients with atrial fibrillation.

Initial Measures Set

The PVRP began earlier this year with an initial set of 16 measures to determine quality of service provided in primary care, surgery, nephrology, and emergency medicine. The intent is to furnish doctors with confidential feedback on their data accuracy, reporting rates, and quality of care.

CMS announced the pilot program in October 2005 as a way to measure quality of services provided in primary care, surgery, nephrology, and emergency medicine, and furnish doctors with confidential feedback.

The agency said it would use five parameters to expand the PVRP measure set in 2007. Measures will be expanded to cover as many medical specialties as feasible, using evidence-based, valid measures, with preference given to measures that are adopted by the Ambulatory Quality Care Alliance, the fact sheet said.

Preference also will be given to measures that are endorsed by the National Quality Forum, CMS said. In the case of measures for which an endorsement by these two quality groups is not available, CMS will consider input from relevant professional associations and stakeholders, according to the fact sheet.

Preference also will be given to measures for which electronic data collection exists as an alternative to reporting on claims, CMS said.

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Majority of the Nation’s Eligible Hospitals Report Quality of Care Data

CMS announced that nearly all of the nation’s eligible hospitals reported data on the quality of care they deliver, providing transparency in information for consumers on quality performance measures linked to payments hospitals receive for treating Medicare beneficiaries.

“Improving the quality of the nation’s health care is a major goal for the Medicare program,” said CMS Administrator Mark B. McClellan. “With more complete and extensive information on quality of care to help with their decision making, we have more opportunities than ever to improve hospital care.”

Out of the nation’s 3,490 acute care hospitals eligible to participate, 99 percent of those chose to report quality data.  Out of those hospitals eligible to receive a 2 percent annual payment update from Medicare for participating, 171 failed to meet the FY 2007 reporting requirements (143 failed the submission requirements and 28 chose not to participate).

“This is more evidence that paying for reporting and improving quality can help patients get better care,” said McClellan.  “Consumers can use this information to evaluate care and doctors and hospitals can use it to help improve their performance.” 

Under the Medicare Modernization Act of 2003 (MMA), and later revised under the Deficit Reduction Act of 2005 (DRA), hospitals that submit quality information to CMS are eligible to receive the full Medicare payment update for inpatient services in 2007.  Although reporting is voluntary, those inpatient acute care hospitals that do not report will get a 2 percent reduction in their annual Medicare fee schedule update, a much greater impact than last year’s 0.4 percentage point reduction.

“This unprecedented, consistent information on the quality of hospital care is possible because of the collaboration of hospitals, consumers, insurers, and employers working together to achieve a more transparent health care system,” said McClellan.  “We will continue to work together to provide even better information to help create a system that keeps people healthy, avoids complications and ensures the right care for every patient, every time.”

For 2007, an additional 11 measures were added to the 10-measure starter set. The measures relate to conditions that commonly result in hospital stays among people with Medicare, including heart attack, heart failure and pneumonia, as well as measures related to surgical care improvement.  The measures in each condition address key aspects of appropriate care. 

In the Outpatient Prospective Payment System Proposed Rule, CMS proposes to expand the set of measures for FY 2008 to include additional SCIP measures, mortality measures, and patient satisfaction using the HCAHPS Survey, also known as Hospital CAHPS or the CAHPS Hospital Survey.  Details on the proposed measures can be found on the CMS website at: http://www.cms.hhs.gov/HospitalOutpatientPPS/HORD/itemdetail.asp?filterType=none&filterByDID=-99&sortByDID=3&sortOrder=descending&itemID=CMS1185569.

Hospitals not meeting the quality data requirements for FY 2007 may exercise its right to appeal and submit a letter to CMS outlining its reasons for requesting reconsideration by no later than November 1, 2006.  

For more information on Hospital Quality Data for Annual Payment Update, visit http://www.cms.hhs.gov/HospitalQualityInits.  For a full list of hospitals eligible for FY 2007, please see: http://www.qualitynet.org.

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Medicare Adds Performance-Based Payments for Physicians

CMS announced a new initiative to pay physicians for the quality of the care they provide to seniors and disabled beneficiaries with chronic conditions, reflecting the Administration’s ongoing commitment to reward innovative approaches to get better patient outcomes for the health dollar.

We intend to provide better financial support for quality care,” said CMS Administrator Mark B. McClellan, “Through this demonstration and the rest of our set of value-based payment demonstrations, we are finding better approaches to doing that than ever before.  This is another important step toward paying for what we really want:  better care at a lower cost, not simply the amount of care provided.”

As the next step in its efforts to make higher payments for better quality, CMS announced the implementation of a new demonstration aimed at physicians practicing in solo or small to medium sized group practices. CMS has already implemented several other “pay-for- performance” demonstrations, including the Premier Hospital Quality Incentives Demonstration which involves acute care hospitals and the Physician Group Practice demonstration which involves 10 large multi-specialty group practices across the country.

“We know that most patients receive care in smaller medical practices,” said McClellan, “which is why it’s so important to have an approach that works for making the link between payment and quality of care in these settings.”

The Medicare Care Management Performance (MCMP) Demonstration was authorized under section 649 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA).  It will be implemented in four states: Arkansas, California, Massachusetts, and Utah in 2007.

These four states served as the pilot states for the Doctor’s Office Quality – Information Technology (DOQ-IT) project which was implemented by CMS in conjunction with the Quality Improvement Organizations to promote the adoption of electronic health record systems and information technology in small to medium-sized physician practices and to help enhance quality of care.

Approximately 800 practices in the four states will be recruited to participate in this three-year demonstration.  In order to be eligible to participate, physicians must be the main provider of primary care to at least 50 fee-for-service Medicare beneficiaries in a solo or small to medium-sized group practice.

Under this demonstration, physician groups will continue to be paid on a fee-for-service basis.  Participating physicians will submit data annually on up to 26 quality measures related to the care of patients with diabetes, congestive heart failure, and coronary artery disease, as well as the provision of preventive health services such as immunizations and cancer screenings to high risk patients with a range of chronic diseases. In its first year, the program will be a “pay-for- reporting” initiative to provide baseline information on quality and to help physicians become familiar with the quality measurement process.  In subsequent years, based on their performance on the quality measures, practices will be eligible to earn an annual incentive of up to $10,000 per physician and up to $50,000 per practice year. 

The quality measures being used are similar to those being used in other CMS pay-for-performance demonstrations, and have been endorsed or are in the process of endorsement by the National Quality Forum and the AQA (formerly the Ambulatory Care Quality Alliance), and are consistent with the measures being used in Medicare’s Physician Voluntary Reporting Program.

Included among them are the percentage of diabetic patients whose cholesterol is under control and who are getting appropriate foot and eye exams, the percentage of congestive heart failure and coronary artery disease patients receiving appropriate medication therapy, and the percentage of high risk patients with chronic diseases getting appropriate immunizations and cancer screenings.  A complete list of the measures is available on the demonstration web site: http://www.cms.hhs.gov/DemoProjectsEvalRpts/MD/list.asp.

Based on the actuarial analysis underlying the demonstration program, improved performance on these clinical quality measures and the better quality of care that they reflect is expected to result in overall savings to the Medicare program owing to reduced admissions to hospitals and emergency rooms as well as delayed onset or avoidance of complications from these serious chronic conditions.

Further information on all of these demonstrations and Medicare’s collaborations to improve quality of care is available at: http://www.cms.hhs.gov/DemoProjectsEvalRpts/MD/list.asp.

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Feds Help Pave Way for E-Health Technology

CMS and the Office of the Inspector General (OIG) recently issued a final rule to create two new exceptions to the Stark Law and two new safe harbors to the Anti-Kickback Statute (AKS) that will permit, under certain circumstances, the donation of health information technology items and services for the purpose of improving electronic prescribing and electronic health records (EHR) capabilities. The new safe harbors and exceptions are intended to promote the use of health information technology in the interests of quality of care, patient safety, and health care efficiency, while also maintaining security and privacy.

Electronic Health Records

The Safe Harbor/Stark Exception for EHR is designed to further the goal of "open, interconnected, interoperable, electronic health records systems" that can enhance health care delivery. The regulatory requirements are intended to minimize the potential that the donation of EHR technology will induce referral or self-referral of federal health care business, contrary to the Stark and AKS laws, but be broad enough to encourage potential donors and recipients to establish EHR capabilities to enhance safety, quality and efficiency in the health care industry.

Software may be donated by an individual or entity that directly or through reassignment bills Medicare, or a health plan. Recipients may include any individual or entity engaged in the delivery of health care. However, pharmaceutical, device or DME manufacturers are not eligible donors.

Donated software must be interoperable at the time it is provided to the recipient. The term "interoperable" is defined as "able to communicate and exchange data accurately, effectively, securely and consistently with different information technology systems, software applications, and networks, in various settings, and exchange data such that the clinical or operational purpose and meaning of the data are preserved and unaltered." Software will not be considered interoperable if it is capable of communicating or exchanging data only within a limited health care system or community.

Under the final rules, the physician must pay 15 percent of the donor's costs for the donated items and services before receiving such items and services, and the donor is not permitted to finance the physician's payment or loan the physician the money. The final rules do not state explicitly whether the physicians' 15 percent contribution is a minimum (i.e., they can be required to pay more than 15 percent of the donor's costs) or an absolute benchmark, that may not be lowered or raised. However, since the Final rules were published, the OIG and CMS have indicated informally that the 15 percent is intended as a floor.

It is too early to know whether the new Safe Harbor/Stark Exceptions will be widely used, or whether the adoption of EHR or e-prescribing technology will be effective to improve the quality and efficiency of heath care delivery. A number of commentators suggest that, while these regulations are helpful, they do not go far enough to effectively move forward HIT adoption by the health care industry. Without addressing multi-functional systems or health information network participation, efforts to electronically share health information will continue to be less than optimal. Time will tell whether this concern can perhaps be addressed in a later set of safe harbors. Proposed federal legislation (H.R. 4157) may further expand the protections for the rollout of EHR and e-prescribing technology.

These regulations are effective October 10, 2006. The final rule was published in the August 8, 2006 Federal Register (Vol. 71, Issue 152). To read the final rule, click HERE.