The Center for Medicare & Medicaid Services’ (CMS) Pay for Performance programs seek to improve patient safety and experience by basing Medicare payments on the quality of care provided, rather than on the quantity of services performed. These “Pay for Performance” programs are broken down into three categories: Value Based Purchasing (VBP), Readmission Rates, and Hospital Acquired Conditions. 

VBP affects payment for inpatient stays based on approximately 2,700 hospitals' performance scores on quality and patient experience measures. Under this program, Medicare rewards hospitals with payments based on either how well they perform on certain quality measures and cost relative to their peers or how much they improve their performance over time. The highest-performing hospitals can earn back bonuses greater than the 2% payment withhold CMS uses to fund this program, while others may not earn back any of the withheld amount.

DKH is proud to rank among the top half of hospitals across the country and is receiving the fourth highest incentive payment percentage in Connecticut out of only 11 hospitals in the state to receive a bonus payment. DKH will receive a .32% value-based incentive payment that will be applied to each Medicare fee-for-service patient discharge in FY20.

Under the Readmission Reduction program, CMS may withhold up to 3% of inpatient reimbursement if hospitals have higher than expected 30 day readmission rates for certain conditions including heart failure, pneumonia, hip and knee replacements, and chronic lung disease. 83% of hospitals nationally will receive a readmission rate penalty. While DKH is among them, the size of our readmission rate penalty (.15%) is significantly lower than the national average of .71% and is also the 6th lowest out of 27 hospitals in Connecticut.

Under the Hospital Acquired Condition (HAC) program, hospitals are evaluated based on their rates of several avoidable complications including bed sores, central line infections, blood clots, and other infections. Hospitals could lose 1% of their Medicare payments if they are in the worst performing quartile (bottom 25%). DKH performed well in this measure and did not receive this penalty, although 786 hospitals nationally did as well as 13 Connecticut hospitals.

When all three of these “Pay for Performance” programs are combined for this year, DKH was one of only 3 hospitals in the state to receive a net incentive payment. All other hospitals had a net withhold of payments from CMS.

This is a testament to the quality of care we provide across our health system on a daily basis and our ongoing commitment to improving patient safety and experience.

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