Rise of Pay for Performance

Abstract

Many health care providers and policy makers believe that health care financing systems fail to reward high-quality care. In recent years, federal and private payers have begun to promote pay for performance, or value-based purchasing, initiatives to raise the quality of care. This report describes conceptual issues in the design and implementation of pay for performance for chronic kidney disease and ESRD care. It also considers the implications of recent ESRD payment policy changes on the broader goals of pay for performance. Congressionally mandated bundle payment demonstration for dialysis, newly implemented case-mix adjustment of the composite rate, and G codes for the monthly capitation payment are important opportunities to understand facility and provider behavior with particular attention to patient selection and treatment practices. Well-designed payment systems will reward quality care for patients while maintaining appropriate accountability and fairness for health care providers.

Early hospital readmission among hemodialysis patients in the United States is associated with subsequent mortality

“…15 It is also unlikely that complete discharge information, which may be more important than admission information for preventing c l i n i c a l i n v e s t i g a t i o n readmissions in the hemodialysis population, 10 will be available to the dialysis facilities within a few days. Smaller, independent dialysis providers who may experience greater penalizations with SRR for poor performance due to their relative inability to pool risks across large populations of patients 16,17 are probably also less likely to be able to afford a transition coordinator who could facilitate rapid communication of critical discharge information between multiple hospitals and dialysis facilities across different electronic medical record systems.…”

Is there “Cherry Picking” in the ESRD Program? Perceptions from a Dialysis Provider Survey

“…Future policies must emphasize adequate payment for dialysis and case-mix adjustment to ensure fairness and limit cherry picking practices (6,8,17). Cherry picking practices should be strongly discouraged.…”

“…Although some of these initiatives have shown promise in improving process-based measures, the long-term outcomes and economic effects of these policy changes remain uncertain (1)(2)(3)(4). Prior experiences with changes in reimbursement policy suggest that insufficient funding or poorly designed incentive mechanisms can result in unintended and unwanted consequences (5,6).…”

“…Moreover, CMS adopted a new case-mix adjustment system in 2005 based on age and body size (6). Under this system, Medicare modifies reimbursement on the basis of patient characteristics.…”

Performance Measurement in Chronic Kidney Disease

“…13,14 Moving forward, ESRD remains at the forefront of CMS's quality efforts with the proposed rollout of the Quality Incentive Program in January 2012, which will be the first pay-forperformance program in a Medicare feefor-service environment. 15,16 In many respects, these early efforts successfully increased quality and accountability within the ESRD Program, 17 but dialysis outcomes remain poor despite continued high costs, making a poor showing for value. 18,19,13,20 As a result, payers are now shifting their gaze to CKD in the hopes of limiting progression to ESRD and bending the curve on long-term costs.…”