Hospital Value-Based Purchasing & Reimbursement Strategy

Hospital Value-Based Purchasing & Reimbursement Strategy

The CMS value-based purchasing landscape for hospitals encompasses four major programs that collectively affect Medicare reimbursement based on clinical quality, patient safety, patient experience, and efficiency performance. Understanding each program's specific performance domains, the methodology by which performance translates into payment adjustments, and the relationship between clinical operations and measured performance is the foundation of an effective VBP strategy.

Most hospitals approach VBP reactively — receiving their payment adjustments after the performance period has ended and then trying to understand what happened. A proactive VBP strategy uses real-time performance data, a clear understanding of each program's methodology, and targeted clinical improvement efforts to shift performance before the measurement period closes.

Service Areas

Hospital Value-Based Purchasing Program (VBP)

The VBP program adjusts Medicare DRG payments based on hospital performance across four domains: clinical outcomes, person and community engagement (HCAHPS), safety, and efficiency and cost reduction. We analyze your current VBP performance domain by domain, model the payment impact of specific performance improvements, and build a targeted improvement strategy that maximizes your VBP adjustment within realistic operational constraints.

Hospital-Acquired Condition Reduction Program (HACRP)

The HACRP imposes a 1% payment reduction on hospitals in the worst-performing quartile on a composite of HAC measures. We analyze your current HACRP performance and implement the infection prevention and patient safety programs needed to move your hospital out of penalty territory.

Hospital Readmissions Reduction Program (HRRP)

The HRRP reduces payments to hospitals with excess readmissions for six specified conditions. We conduct a detailed readmission analysis — by condition, by discharge destination, by patient population, and by time period — and implement readmission reduction programs that address your specific readmission drivers.

Merit-Based Incentive Payment System (MIPS) for Hospital-Based Physicians

Hospital-based physicians who participate in Medicare Part B are subject to MIPS — a value-based payment program that adjusts their Part B payments based on quality, improvement activities, promoting interoperability, and cost performance. We help hospitals understand their hospital-based physicians' MIPS participation status and build the data reporting and clinical improvement infrastructure needed to support strong MIPS performance.