Understanding The Role Played By Medicare’s Patient Experience Points System In Hospital Reimbursement

TLDR

In 2015, the Medicare Hospital Value‑Based Purchasing program allocated $1.4 billion in incentives, with 30 % of a hospital’s score tied to HCAHPS patient‑experience measures that are awarded based on achievement, improvement, and consistency. The study examined how achievement, improvement, and consistency components influenced reimbursement for 3,152 hospitals, focusing on low‑performing and high‑minority institutions. Using 2015 data, the authors analyzed the relationship between the three patient‑experience components and hospital reimbursement across 3,152 facilities. Achievement explained 96 % of the variation in HCAHPS points, yet improvement and consistency payments were more advantageous for low‑performing, minority‑serving hospitals, indicating that incentivizing improvement can motivate these institutions and reduce resource disparities.

Abstract

In 2015 the Medicare Hospital Value-Based Purchasing (VBP) program paid hospitals $1.4 billion in performance-based incentives; 30 percent of a hospital's VBP Total Performance Score was based on performance on Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) measures of the patient experience of care. Hospitals receive patient experience points based on three components: achievement, improvement, and consistency. For 2015 we examined how the three components affected reimbursement for 3,152 hospitals, including their impact on low-performing and high-minority hospitals. Achievement accounted for 96 percent of the differences among hospitals in total HCAHPS points. Although achievement had the biggest influence on payments, payments related to improvement and consistency were more beneficial for low-performing hospitals that disproportionately served minority patients. The findings highlight the important inducement that paying for improvement provides to initially low-performing hospitals to improve care and the role this incentive structure plays in minimizing resource redistributions away from hospitals serving minority populations. Additional emphasis on improvement points could benefit hospitals serving disadvantaged patients.