SIDEBAR G Paying for Quality

In 2003, CMS began a project that

The CMS–Premier, Inc. (CMS 2003) project is organized as follows:
■ Financial bonuses to hospitals are based on specific quality measures
for certain clinical conditions—heart attack, heart failure, hip and knee
replacements, pneumonia, and coronary artery bypass grafts.
■ Proposed measures are derived from the Leapfrog Group, AHRQ patient
safety indicators, Core Measures of JCAHO, CMS’s 7th Scope of Work,
NQF indicators, and the National Voluntary Hospital Reporting Initiative.
■ Hospitals in the top 20 percent for quality receive a bonus.
■ Hospitals in the top decile for a given diagnosis receive a 2 percent
bonus of their Medicare payments for the condition.
■ Hospitals in the second decile receive a 1 percent bonus.
■ Hospitals participating in the project receive previously collected quality
data from the Premier Perspective database as a historical reference.
Results of the project’s first year should be reported on the CMS web site
in early 2005. The report will recognize those hospitals that achieved the
highest quality and those that received bonuses.
■ A payment structure does not exist
that rewards investment in programs
that benefit patients years into the
future (e.g., smoking cessation,
diabetes management).
■ Patients do not have the option of
purchasing more customized
healthcare benefits that focus on
quality or better chronic-disease
management.
■ Many proven quality interventions
are not routinely employed because
information about them is not easily
available or is not well appreciated
by providers. This may require more
investment in improved clinical
information and decision support
systems.
would, in fact, reimburse hospitals at
a higher rate if they can show
evidence of quality outcomes in a
number of acute care areas. CMS’s
partner in this effort is Premier, Inc., a
nationwide organization of not-for-
profit hospitals that could track and
report quality data for 34 measures at
its member hospitals. See Sidebar G.
The Leapfrog Group Standards
The Leapfrog Group is sponsored by
the Business Roundtable, a national
association of Fortune 500 CEOs. This
voluntary program mobilizes large
purchasers to alert the healthcare
industry about the major
improvements in patient safety and
customer value that need to be
recognized and rewarded with
preferential use and other intensified
market reinforcements.
The Leapfrog Group aims to
enhance the dialog among healthcare
purchasers, providers, and consumers.
It also seeks to significantly influence
the efforts to address the yearly death
toll from preventable medical mistakes.
The Leapfrog Group has identified
three safety measures or standards
that inform comparisons of healthcare
provider performance, recognition,
and reward:

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