10 Quality Provisions in the FY 2014 IPPS Rule to Know

CMS' final rule for the Hospital Inpatient Prospective Payment System in fiscal year 2014 includes several changes related to quality and patient safety.

Here are some of the major quality- and safety-related provisions in the final rule, based on a CMS fact sheet:

1. CMS will implement the Hospital-Acquired Condition Reduction Program in FY 2015. Under this program, hospitals in the lowest quartile for medical errors or hospital-acquired infections will receive a 1 percent penalty on reimbursement.

Performance will be based on two domains included in the Inpatient Quality Reporting program. The first is a composite that includes eight individual measures, including pressure ulcer rate, postoperative hip fracture rate and postoperative sepsis rate. The second domain will include central line-associated blood stream infections and catheter-associated urinary tract infections for FY 2015. CMS will add surgical site infections to this domain in FY 2016 and methicillin-resistant Staphylococcus aureus and Clostridium difficile in FY 2017.

2. The maximum penalty under the Hospital Readmissions Reduction Program will be increased from 1 percent to 2 percent for FY 2014.

3. CMS developed an expanded "planned readmission algorithm" to exclude more planned readmissions from the penalty calculation under the Readmissions Reduction Program, beginning in FY 2014. In addition, penalty calculations will not include unplanned readmissions that occur within 30 days of a planned readmission.

4. In FY 2015, the Readmissions Reduction Program will add readmissions for hip/knee arthroplasty and chronic obstructive pulmonary disease patients to the three current conditions used to calculate hospitals' penalties.

5. Hospitals that do not participate in the IQR program will lose one-quarter of the percentage increase in their payment updates beginning in FY 2015.

6. CMS will remove six chart-abstracted measures and one structural measure, suspend one chart-abstracted measure and validate two measures (MRSA bacteremia and Clostridium difficile) in the IQR program for payment determination beginning in FY 2016. CMS will also adopt five new claims-based measures:

•    30-day risk-standardized COPD readmission
•    30 day risk standardized COPD mortality
•    30-day risk standardized stroke readmission
•    30-day risk standardized stroke mortality
•    Acute myocardial infarction payment per episode of care

7. In calendar year 2014 for FY 2016 payment determination, hospitals participating in the IQR program will be able to submit data on up to 16 selected measures across four measure sets electronically. This submission may allow hospitals to meet reporting requirements for both clinical quality measures under the Medicare EHR Incentive Program and measures under the IQR program.

8. The applicable percent reduction to base operating diagnosis-related group payments under the Hospital Value-Based Purchasing Program will increase from 1 percent in FY 2013 to 1.25 percent in FY 2014. CMS estimates this reduction will make approximately $1.1 billion available for value-based incentive payments to hospitals.

9. CMS is readopting most of the fiscal year 2015 clinical process of care measures in the VBP program for FY 2016. It is also adopting new measures for FY 2016, including influenza immunization, CAUTIs and surgical site infections.

10. CMS created a disaster/extraordinary circumstance exception process for hospitals struck by a natural disaster to request exception from the VBP program.

Editor's note: This article originally stated that domain 1 for the HAC Reduction Program was a composite of 11 measures, which were listed in the CMS fact sheet. While the full AHRQ PSI-90 composite includes 11 measures, CMS is adopting eight for the HAC Reduction Program, as proposed, as this was the version reviewed by the Measures Application Partnership and endorsed by the National Quality Forum. Both the CMS fact sheet and this article have been updated to reflect this fact.

More Articles on the Federal Quality Programs:

CMS to Fine Hospitals $227M for High Readmissions
AHA Tells Hospitals to Slow Quality Data Generation
House Coalition Calls for CMS to Revise 2 Stroke Measures

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