Yet another Obamacare incentive program crashes and burns

posted at 11:21 am on August 8, 2014 by Noah Rothman

It seems as though yet another of Obamacare’s many “nudging” efforts, aimed at creating incentives for the population to behave in ways deemed by technocrats to be of maximum public benefit, has failed dismally.

The Hospital value-based purchasing program (HVBP), established by the Affordable Care Act, was designed to link the payments hospitals received with the quality of care they provided.

“CMS took back 1.25 percent of Medicare reimbursement at hospitals paid under the IPPS in fiscal year 2014,” a report in Becker’s Hospital Review read. “The resulting $1.1 billion was dispersed to hospitals based on how well they performed on healthcare quality measures, like treatment of heart attack and congestive heart failure, as well as patient satisfaction.”

In fiscal year 2014, 778 hospitals lost more than 0.2 percent of their Medicare pay, while 630 hospitals received a bonus of more than 0.2 percent.

For 2015, CMS is increasing the applicable percent reduction, the portion of Medicare payments available to fund the value-based incentive payments under the program, to 1.5 percent of Medicare reimbursements, resulting in about $1.4 billion in value-based incentives.

In short, the program was designed to “nudge” those hospitals deemed to be underperforming to increase the standards of the care they provided. However, a report in Vox.com noted that a study of hospitals was recently conducted by Cornell University’s Andrew Ryan and a team of researchers with the intention of determining whether or not that program was effective. They found no noticeable change in the care provided by the hospitals that were punished under the HVBP program.

“It’s possible that the incentives in this particular program might be too small to encourage hospital administrators to make big investments,” Vox’s Sarah Kliff wrote. “They could be making a calculation: it would be more work than its worth to do better.”

In order to address that issue, she suggests that the British National Health Service, which ties 20 percent of a doctor’s pay to the quality of care they provide based on government evaluations, seems like the way to go.

In other words, the only solution to the problems of government “nudging” is more “nudging.”

But here is the true rub in Kliff’s report:

One other possibility: Ryan and his colleagues noticed, in the data, is that when you look back at 2008, there is some evidence that hospitals were improving back then at a faster rate than the non-participants. This suggests that hospitals may have begun improving quality in preparation for these policy changes a few years in advance, and are now reaping the benefits of that advance planning.

So, hospitals were increasing the standards of care well before a massive health care overhaul was passed and that rate of improvement stalled in the wake of the implementation of this new law. Whatever could that mean…

“This would have meant the hospitals were preparing for the program two years prior to the Affordable Care Act passing, and would have had a sense whether they would fall in the bonus pool or not,” Kliff writes. She notes that, while it was not federal policy until the passage of the ACA in 2010, people had been talking about an incentive program like this since at least 2003.

One would have to assume then that she is suggesting that hospital administrators were adjusting their behavior according to a law which had not passed. Which is… positively baffling.


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But these Obamacare posts are about whistling past the graveyard, by next Novemeber Democrats will be openly running on the ACA. Mark my words.

libfreeordie on December 20, 2013 at 10:14 AM

Schadenfreude on August 8, 2014 at 11:25 AM

“It’s possible that the incentives in this particular program might be too small to encourage hospital administrators to make big investments,” Vox’s Sarah Kliff wrote. “They could be making a calculation: it would be more work than its worth to do better.”

A health care professional consider saving lives as “more work?” Vox and it’s writing staff are a bunch of grammar school essay writers.

Walter L. Newton on August 8, 2014 at 11:26 AM

Those who plan ahead = punished

Those who don’t plan ahead = rewarded

Yup, sounds like normal for this administration

NapaConservative on August 8, 2014 at 11:32 AM

IPPS

Schadenfreude on August 8, 2014 at 11:33 AM

Cue Ned Pepper to plagiarize something completely irrelevant from the Daily Kos.

Chuck Schick on August 8, 2014 at 11:35 AM

Ned Pepper’s pajamas are getting tight from all the cocoa he’s drinking.

NapaConservative on August 8, 2014 at 11:37 AM

Ned Pepper’s pajamas are getting tight from all the cocoa he’s drinking.

NapaConservative on August 8, 2014 at 11:37 AM

Um, it might be brown but it ain’t cocoa…………….

VegasRick on August 8, 2014 at 11:38 AM

Um, it might be brown but it ain’t cocoa…………….

VegasRick on August 8, 2014 at 11:38 AM

RASIST!!! :)

NapaConservative on August 8, 2014 at 11:41 AM

Chuck Schick on August 8, 2014 at 11:35 AM

Beat me to it and said it better than I would.

Closet Optimist on August 8, 2014 at 11:41 AM

How does Ned Pepper think this is remotely functional?? Yes I think it’s goal was to fail for single payer or at least have them try at it. But this is just pathetic it has blown up on the launch pad catching fire to every other part of the law along with questionable legalities in the courts. Who the hell writes this crap?? It’s a unfunctional foo boondoggle that is turning people off to single payer because this retarted meth baby of a law can’t even function well on its best days let alone on a time crunch….

sorrowen on August 8, 2014 at 11:43 AM

Ned’s head has exploded.

Schadenfreude on August 8, 2014 at 11:47 AM

Worked at the VA didn’t it? Look at all the bonus they paid out for superior care…

Oh, wait.

Snowblind on August 8, 2014 at 11:51 AM

So Noah is getting his information from Vox? What’s next, Voxsplaining?

Barred on August 8, 2014 at 11:51 AM

Where’s Ned Pecker on this?

docflash on August 8, 2014 at 11:59 AM

Where’s Ned Pecker on this?

docflash on August 8, 2014 at 11:59 AM

Stuck in obaME!’s azz as Shad says.

VegasRick on August 8, 2014 at 12:06 PM

I’m flummoxed….yes I said flummoxed…as to how the greatest liberal minds ever assembled could get legislation so wrong.

I mean Dick Durbin, Nancy Pelosi, Maxine Waters, that’s got to be a combined IQ measured in four digits maybe even five, what the hell happened?

Bishop on August 8, 2014 at 12:06 PM

I mean Dick Durbin, Nancy Pelosi, Maxine Waters, that’s got to be a combined IQ measured in four digits maybe even five, what the hell happened?

Bishop on August 8, 2014 at 12:06 PM

Four digits and move the decimal point two places left.

partsnlabor on August 8, 2014 at 12:19 PM

But these Obamacare posts are about whistling past the graveyard, by next November Democrats will be openly running on the ACA. Mark my words.

libfreeordie on December 20, 2013 at 10:14 AM

Schadenfreude on August 8, 2014 at 11:25 AM

..timeless classic! It never gets old, does it, my brother?

The War Planner on August 8, 2014 at 12:23 PM

OT, somewhat.

Hubby went to the VA clinic today to get an appointment for the audiologist for new hearing aids.

Last year, a similar errand took almost 3 hours of waiting at the clinic before he could see someone to make an appointment. The appointment itself was scheduled for 4 months later, IIRC. Maybe longer.

Today, he was able to walk up and make the appointment immediately with a friendly helpful person, and the appointment is for the middle of September.

In Jivin’ Joe’s phraseology, this is a big effing change.

Dolce Far Niente on August 8, 2014 at 12:26 PM

Four digits and move the decimal point two places left.

partsnlabor on August 8, 2014 at 12:19 PM

You’re being too kind. It’s more likely three or four places to the left. I doubt if they all pooled their ‘brains’ together, they still couldn’t get two synapses to fire together.

ZeusGoose on August 8, 2014 at 12:33 PM

I mean Dick Durbin, Nancy Pelosi, Maxine Waters, that’s got to be a combined IQ measured in four digits maybe even five, what the hell happened?

Bishop on August 8, 2014 at 12:06 PM

Four digits – to the right of the decimal point.

AJsDaddie on August 8, 2014 at 12:35 PM

Dolce Far Niente on August 8, 2014 at 12:26 PM

meanwhile I have been calling every day over last 3 weeks to make an appt to be seen by a primary so I can then be seen for eyecare issue.
not once have I been able to get through.
this has never happened to me since I got out in 89.

dmacleo on August 8, 2014 at 12:41 PM

Today, he was able to walk up and make the appointment immediately with a friendly helpful person, and the appointment is for the middle of September.

In Jivin’ Joe’s phraseology, this is a big effing change.

Dolce Far Niente on August 8, 2014 at 12:26 PM

Pls report back with an update slightly after the middle of September.

Tsar of Earth on August 8, 2014 at 12:41 PM

Cue Ned Pepper to plagiarize something completely irrelevant from the Daily Kos.

Chuck Schick on August 8, 2014 at 11:35 AM

That or from HuffPoo.

I think we should call him “Dr. Pepper,” since he’s so smart and all–and full of gas.

But the HAL moniker is hysterical, as well. I laugh every time someone commands him to sing “Daisy.”

MisterElephant on August 8, 2014 at 12:42 PM

… 630 hospitals received a bonus of more than 0.2 percent.

Wow. So, to bring these numbers into the scale of a typical income of $50,000 a year, that’s the equivalent of a $100 bonus. I’m shocked that the efforts elicited by such titanic sums didn’t measurably improve the hospitals’ work.

Fabozz on August 8, 2014 at 12:44 PM

meanwhile I have been calling every day over last 3 weeks to make an appt to be seen by a primary so I can then be seen for eyecare issue.
not once have I been able to get through.
this has never happened to me since I got out in 89.

dmacleo on August 8, 2014 at 12:41 PM

You have my sympathy. Didn’t even occur to us to call for an appointment like an ordinary medical clinic- that has never worked in the past. He’s always had to actually go to the clinic to get an appointment (often it turned out to be an appointment for an appointment).

Things were remarkably better this time (I am here remarking upon it, in fact).

This is the Corpus Christi, TX clinic, btw.

Dolce Far Niente on August 8, 2014 at 12:58 PM

These incentives, of any amount, are dangerous. A study was done a few years ago in New York, I believe, of cardiologists who had been incented for better outcomes because so many patients die during a certain procedure (catheterization as I remember). The upshot was that patients who were seriously bad off often weren’t treated at all for fear they might die on the table. Many of whom could have been saved.

MaggiePoo on August 8, 2014 at 1:00 PM

It’s possible thatthe incentives in this particular program might be too small to encourage hospital administrators to make big investments,” Vox’s Sarah Kliff wrote. “They could be making a calculation: it would be more work than its worth to do better.”

In order to address that issue, she suggests that the British National Health Service, which ties 20 percent of a doctor’s pay to the quality of care they provide based on government evaluations, seems like the way to go.

What she actually means. Single payer.

Patriot Vet on August 8, 2014 at 1:06 PM

“This would have meant the hospitals were preparing for the program two years prior to the Affordable Care Act passing….”

But how would they have known what was in it before it passed?

PersonFromPorlock on August 8, 2014 at 1:09 PM

What she actually means. Single payer.

Patriot Vet on August 8, 2014 at 1:06 PM

After all, it works so well with the VA….

Athos on August 8, 2014 at 1:16 PM

Dolce Far Niente on August 8, 2014 at 12:26 PM

Too bad it took all hell breaking loose for this improvement to happen! What you described as a big effin deal should be S.O.P. for our vets

rhbandsp on August 8, 2014 at 1:20 PM

But how would they have known what was in it before it passed?

PersonFromPorlock on August 8, 2014 at 1:09 PM

They have ESPN or something. :-)

They are rated, under this scheme, on how a patient ‘feels’ they were treated. How scientific of them.

This year, 45 percent of a hospital’s score is based on how frequently it followed basic clinical standards of care, such as removing urinary catheters from surgery patients within two days to decrease the chance of infections. Thirty percent of the score is based on how patients rate the way they felt they were treated in the hospital, such as whether the doctors and nurses communicated well.

In 2015, 20% (Efficiency) is based on Medicare spending per beneficiary member.

Only the government could make healthcare more f-ed up.

Patriot Vet on August 8, 2014 at 1:29 PM

After all, it works so well with the VA….

Athos on August 8, 2014 at 1:16 PM

Tell me about it. I know from experience.

Patriot Vet on August 8, 2014 at 1:54 PM

Commie-crats don’t seem tho think that basic economics or economic self-interest apply to anyone outside of themselves, even though they do the exact same things everyone else does when their ox gets gored. Are they insane or just F’ing stupid? A combination of both? In denial? What? A thinking person just cannot understand this.

earlgrey on August 8, 2014 at 2:38 PM

Bet they each have a death panel now.

formwiz on August 8, 2014 at 4:38 PM

In order to address that issue, she suggests that the British National Health Service, which ties 20 percent of a doctor’s pay to the quality of care they provide based on government evaluations, seems like the way to go.

And we all know how well the British National Health Service has worked out for them.

As long as you don’t get sick.

GarandFan on August 8, 2014 at 6:19 PM

And we all know how well the British National Health Service has worked out for them.

As long as you don’t get sick.

GarandFan on August 8, 2014 at 6:19 PM

The British NHS has been very successful at getting rid of those troublesome old folks.

slickwillie2001 on August 8, 2014 at 7:11 PM