Nursing Home Quality Based Purchasing Demonstration

1
Nursing Home Quality Based Purchasing
Demonstration

• Mark Wynn
• Director of the Division of Payment Policy
  Demonstrations, CMS
• June 8, 2006

2
Overview

• Objective To improve quality of care for
  Medicare beneficiaries residing in nursing homes
• Purpose of demonstration to test nursing home
  pay for performance
• Monitor, modify and evaluate the demo
• Develop for potential national implementation

3
Approach

• Assess the performance of participating nursing
  homes based on selected measures of quality of
  care
• Award incentive payments to those nursing homes
  that achieve either
• High performance
• Substantial improvement in quality

4
Plans are Tentative

• New contractor will refine design
• Plans for public meetings with stakeholders and
  revisions
• All demonstrations must get cleared by CMS, HHS,
  OMB

5
Basic Principles

• Beneficiaries
• Include All Medicare beneficiaries residing in
  nursing homes
• Both Part A and Part B stays
• Participating facilities
• Include both hospital-based and free-standing
  facilities

6
Demonstration Design

• CMS plans to conduct a 3-year demonstration
• Start about Oct. 2007
• Draft design report will be posted on CMS
  website www.cms.hhs.gov/demoprojectsevalrpts/md/l
  ist.asp

7
State/Medicaid Participation

• Most funding to nursing homes comes from Medicaid
• CMS seeks enthusiastic state participation
• CMS plans to select 4 to 5 states
• State assistance
• Annual surveys, data collection
• Potential for simultaneous Medicaid demonstrations

8
Selection of Nursing Homes

• Seek applicant nursing homes in the selected
  states
• Stratify applicants by quality and other
  characteristics
• Random selection of experimental and control
  groups
• About 50 homes in experimental group in each state

9
Key Issues

• How should nursing home quality performance be
  measured?
• How should the payment pool be determined?
• How should performance be linked to payment?

10
Linking Performance to Payment

• Performance measures will be scored in domains of
  care
• Staffing 30 points
• Avoid Hospitalizations 30 points
• MDS Outcomes 20 points
• Survey Deficiencies 20 points

11
Determining the Incentive Pool

• Demonstration is designed to be budget neutral to
  Medicare
• A savings pool will be determined each year for
  each State
• We anticipate that improvements in quality will
  yield savings to Medicare
• Reductions in avoidable hospitalizations

12
Conclusion

• Demonstration encompasses all Medicare
  beneficiaries
• The performance measures reflect various
  dimensions of quality
• By rewarding both performers and improvers, all
  demonstration nursing homes can potentially
  qualify for a performance award

13
Thank You

• Contacts
• Project Officer Ron Lambert
• Ronald.lambert_at_cms.hhs.gov
• [phone]
• Director, Division of Payment Policy
  Demonstrations Mark Wynn
• Mark.wynn_at_cms.hhs.gov
• [phone]