The ACA Is Hitting Hospitals Hard
ACA is hitting hospitals hard when it comes to the Affordable Care Act, also referred to as Obamacare or ACA, some hospital organizations are already feeling the pinch. Today we will examine the specific provisions which are impacting hospitals, and why some organizations are already worried about the changes.
Hospital Value Based Purchasing Program – Reimbursement Hit 1% in 2013; 2% by 2017
Section 3001 of the Affordable Care Act addresses value rather than volume based payments to hospitals, and measures hospitals according to certain quality measures. Some of these measures are clinical and related to patient outcomes, while others are less tangible such as patient satisfaction. Hospitals which perform well could receive incentives, but for those who are poor performing in regard to attainment and improvement it could mean a cut to payments. For under-performers, Medicare payments will be reduced this year by 1%, with additional cuts in payments equaling up to a 2% reduction in Medicare payments by 2017. This value over volume approach is really targeted toward ensuring that hospitals are providing optimal care, and to drive those who are under-performing to make changes through financial incentives and penalties.
Hospital Readmissions Reduction Program – Reimbursement Hit 1%-3%
Section 3025 of the Affordable care act which was effective beginning on Oct. 2012 penalizes hospitals which have higher than standard readmission rates. This year was the first year that cuts in reimbursement went into place, and only took into account three measures which were reported on including readmissions for Heart Attack, Heart Failure, and Pneumonia. The policy will be expanding in subsequent years to track additional conditions, and hospitals will be responsible for diligently tracking readmissions and providing appropriate reporting to CMS. Beginning in 2014 the reimbursement reduction for hospitals which have a significant readmission rate will increase to a maximum of 2%, and in 2015 it will be increased to a reimbursement reduction rate that will max out at 3%.
The Shift in Payments Related to Acquired Conditions – Reimbursement Hit 1%
Section 3008 of the Affordable Care Act is the most recent section of the Act that will begin to impact some hospitals in FY 2015. This section relates to Hospital Acquired Conditions, such as infection, and creates a numerical score for hospitals. Those hospitals which are shown to have a score in the highest quartile compared to the national average will receive a reduction in their reimbursement rates of up to 1%. This measure has been set forth to drive quality of care by targeting several hospital acquired conditions which are considered preventable is best practices are utilized. A sample of these conditions is as follows:
- Blood incompatibility
- Urinary tract infection
- Falls or other injuries while at the facility (burns, dislocations, fractures, ect.)
- Catheter Infection
- Air Embolism
Total Hits and Disproportionate Share Hospital Payments
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