In pay-for-performance, are hospitals unfairly penalized for patient hardships?

Many pay-for-performance models have yet to account for the role of race, ethnicity, language and income rate in a patient's ability to access care and avoid readmissions — and so are financially penalizing hospitals for circumstances out of its control, reports MPR.  

In a national study, conducted by Children's Hospitals and Clinics of Minnesota of Minneapolis and published in JAMA Pediatrics,researchers examined 179,400 preventable hospital readmissions cases at 43 free-standing children's hospitals across the country from 2013.

The study showed existing pay-for-performance measures would negatively affect some facilities, not necessarily due to poor quality care, but because of the disproportionate hardships experienced by their patient population. Excessive readmissions at these hospitals may be caused, in part, by patients inability to afford medications or coordinate transport for follow-up visits, Gretchen Cutler, scientific investigator at Children's Hospitals of Minnesota and co-author of the study, told MPR.

"The financial effect of P4P penalties is substantial, can worsen the financial challenges already facing safety-net hospitals and can lead to unintended consequences such as hospital closures," wrote Marion Sills, MD, associate professor of pediatrics at the University of Colorado School of Medicine and study co-author, in the report. 

Some healthcare experts have expressed concern over adjusting federal quality payments for social determinants in healthcare, fearful the practice of adjusting for social disparities could accidentally mask poor quality care.  

Hospital and policy leaders nationally are considering new quality reporting solutions for hospitals serving these demographics. Helen Burstin, MD, chief scientific officer for the National Quality Forum in Washington, D.C., said one proposal would pay providers based on progress made at improving patient health over time, according to MPR. Another proposal would pay providers based on a performance comparison with similarly matched peer organizations.

The full report can be accessed here.

More articles on revenue cycle management: 

CHS reports surprising $83M loss as admissions fall
Highmark Health's GPO turns $42M profit on $1B in purchases
Central Peninsula Hospital, Moda Health developing alternate payment model: 5 things to know


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