Hospital Value-based Purchasing and Quality

By June 15, 2017Commentary

It could be asked, as I ask myself, why am I so drawn to studies debunking the benefits of all the whiz-bang health system initiatives which are supposed to improve cost or quality.  Do I just delight in failure?  Probably partly that, but really it is a reaction to the excessive hype surrounding these programs.  They all get plenty of free press and puffery about how they will dramatically improve health and health care in the US.  They should not be promoted in that manner and I do take satisfaction in seeing their proponents get a comeuppance.  So it is with the hospital value-based purchasing program used by Medicare, which a new study carried in the New England Journal of Medicine finds to have had no impact on quality.   (NEJM Article)   The Medicare program began in 2013 and penalizes or rewards hospitals by up to 2% of revenue for their scores on process of care, patient satisfaction, outcomes and cost of care measures.  The researchers compared performance on the measures for hospitals which were in the program and a control group which wasn’t.

The baseline performance of the hospitals subject to the value-based purchasing program and the control group, largely critical access hospitals, was matched.  As might be expected, the intervention hospitals were larger, more likely to be teaching hospitals, more likely to participate in the meaningful use program and to have more Medicaid patients.  Both groups of hospitals showed improvement over the multi-year study period on the clinical process and experience of care measures, both before and after the VBP program started.  The rates of improvement were statistically similar.  30-day mortality rates for common admission reasons were also similar and showed slight improvement.  Characteristics of the hospital appeared to have little effect on performance, including having a greater proportion of Medicare patients.

The authors suggest that the essentially non-existent effect of the hospital value-based purchasing effort may result from its complexity, from the incentives and penalties being too small or other factors.  Or maybe just the whole concept is flawed.  You would think that the very limited impact of many of these cost-control and quality improvement ideas would make proponents more cautious about introducing them.  And they should be because the programs, when mandated, have real world effects.  It cost hospitals and other providers a lot of money to attempt to comply with the requirements and improve their scores.  And the effort they are devoting to this could be better spent on other initiatives that might do more to help patients.

Kevin Roche

Author Kevin Roche

The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry through Roche Consulting, LLC. Mr. Roche is available to assist health care companies through consulting arrangements and may be reached at khroche@healthy-skeptic.com.

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