Report: P4P boosts safety net hospital performance

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The performance gap between safety net and non-safety net hospitals continues to shrink as a result of hospital participation in value-based purchasing, according to an analysis of the HQID Hospital Quality Demonstration Project (HQDP), released last week by the Premier Healthcare Alliance.

About 250 hospitals across 36 states are participating in the value-based purchasing (VBP), or pay-for-performance (P4P), demonstration project, which is a collaboration between Premier and the Centers for Medicare & Medicaid Services (CMS). The facilities include small/large, urban/rural and teaching/non-teaching facilities, each of which report quality data for five high-volume conditions using national measures of quality care.

According to Premier, while at the beginning of the program hospitals serving a large percentage of disproportionate share patients were outperformed by other hospitals in the demonstration project, quality differences have decreased in clinical areas such as heart attack, heart failure and hip/knee replacement.

"The program creates a dynamic where the work is never done--quality goals keep getting more aggressive because as a group, HQID hospitals are improving rapidly over time," said Jack Garon, MD, chief medical officer at Sinai Health System of Chicago. "We focus on current performance, and our goal remains staying in the top 10 percent, which means we must continually improve. The program has incentivized us to chase the top levels of performance. It has also helped us develop quality improvement tools we use to address other quality issues. This program gives everyone the clear goals and the focus they need to eliminate care variations.”

According to Premier, information collected from project participants in the first three years and evaluated according to 30 evidence-based clinical quality measures shows that the programs' composite quality score has improved by an average of 15.8 percent. During that time, CMS also awarded more than $24.5 million to top performers.

“We believe that, properly structured, VBP is a powerful engine for performance improvement that will enhance quality, reduce variation and avoid unnecessary costs,” said Susan Devore, Premier's president and CEO.

To that end, Premier suggested that in implementing VBP or P4P, several policies should be followed, such as:

  • Gradually phasing in payment policy to give hospitals a chance to adjust; providing incentives for attainment and improvement;
  • Giving underperforming hospitals technical assistance and resources to improve, with priority to those facilities that have limited resources and are providing care to the underserved; and
  • Adjusting outcomes measures to account for socioeconomic, environmental and existing patient conditions.