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CMS Offers Pay-for-Performance to Nursing Homes

April 28, 2009:

The Centers for Medicare & Medicaid Services (CMS) is soliciting nursing homes and skilled nursing facilities in New York, Arizona, Mississippi, and Wisconsin to participate in a three-year, pay-for-performance demonstration program beginning in summer 2009.

Under the Nursing Home Value-Based Purchasing Demonstration, CMS will provide financial incentives to nursing homes that meet certain criteria for providing high-quality care. Improved quality of care also results in savings for the Medicare program.

Each year of the demonstration, CMS will score participating facilities on certain quality measures, and facilities with the highest scores or the greatest improvement in score are eligible to receive the performance payment. A set of MDS 2.0-based quality measures will be used as performance measures initially. When MDS 3.0 is implemented, CMS will consider revising the measures and scoring method. Participating facilities will be scored on quality measures related to nurse staffing, avoidable hospitalizations, patient outcomes, and deficiency citations received during inspections. The scoring rules were developed purposely to minimize any incentive for facilities to avoid appropriate hospitalizations.

Research studies indicate that a substantial portion of hospital admissions of nursing home residents may be avoidable through careful management of patients with certain conditions. CMS believes these hospitalizations may be reduced as a result of quality-of-care improvements. The intent of these performance measures is to give facilities a direct incentive to reduce the rate of potentially avoidable hospitalizations, such as those with principal diagnoses of CHF, respiratory infection, electrolyte imbalance, sepsis, or urinary tract infection. Separate measures were developed for short- and long-stay residents; for example, anemia is included for long-term residents only. Progressive anemia is not included for the short-stay measures because it is considered unlikely that a short nursing home stay would be sufficient to affect the anemia.

Medicare-certified nursing homes and skilled nursing facilities (SNFs) interested in participating must submit an application by May 1, 2009, to be considered for the Nursing Home Value-Based Purchasing Demonstration.

Sarah Serling, CPC, CPC-H, CPC-I, CCS-P, CCS
Clinical/Technical Editor


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