ObamaCare Program Rewards Low-Quality Hospitals That Cut Costs

ObamaCare Program Rewards Low-Quality Hospitals That Cut Costs – New American

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An ObamaCare program supposedly aimed at promoting high-quality, low-cost care has instead rewarded many hospitals for cutting costs regardless of the quality of their care, a recent Government Accountability Office (GAO) audit found.

The report, which was mandated by the healthcare law, reviewed the results of the Hospital Value-based Purchasing (HVBP) program, which rewards or penalizes about 3,000 participating hospitals for their performance on several quality and efficiency metrics. The program is budget-neutral; the Centers for Medicare and Medicaid Services (CMS) pays bonuses from a fund consisting of a small percentage withheld from each hospital’s Medicare reimbursements.

Although most hospitals have received a bonus or penalty of 0.5 percent each year since 2013, when the program began, over time an increasing percentage of hospitals has gotten even larger bonuses or penalties. According to the report, “Over the years, the median bonus has more than doubled, but the median penalty has nearly tripled.” Compared to all hospitals, a higher percentage of small urban and rural hospitals has received bonuses of more than 0.5 percent, while more safety-net hospitals—those that serve largely low-income Americans—have been penalized.

What is really noteworthy about the report, however, is the GAO’s finding that hospitals with poor or missing quality metrics can still snag significant bonuses if they cut costs. An efficiency metric, which simply measures Medicare reimbursements per beneficiary, was added to the program in 2015; it accounts for 25 percent of a hospital’s overall score. Since that time, noted the GAO, “about 20 percent of the hospitals that received bonuses each year had weighted composite quality scores below the median for all hospitals.” Furthermore, “For each fiscal year, a higher percentage of safety net and small rural hospitals received bonuses (between 26 and 36 percent) when compared to all hospitals, despite having quality scores below the median score for all hospitals.”

 

 

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