Corporate Compliance

CMS: Pay for performance improves quality

Compliance Monitor, November 16, 2005

CMS is reporting that quality of care has improved significantly in hospitals participating in the Premier Hospital Quality Incentive program, a Medicare pay-for-performance demonstration project.

"We are seeing that pay-for-performance works," said CMS Administrator Mark B. McClellan, MD, PhD. "We are seeing increased quality of care for patients, which will mean fewer costly complications--exactly what we should be paying for in Medicare."

Medicare is awarding $8.8 million to hospitals that showed measurable improvements in care during the first year of the program.

Improvement in these evidence-based quality measures is expected to provide long-term savings, because of their demonstrated relationship to improved patient health, fewer complications, and fewer hospital readmissions. Composite quality scores improved between the first and last quarters of the first year of the demonstration

  • from 87% to 91% for patients with acute myocardial infarction (heart attack)

  • from 65% to 74% for patients with heart failure

  • from 69% to 79% for patients with pneumonia

  • from 85% to 90% for patients with coronary artery bypass graft

  • from 85% to 90% for patients with hip and knee replacement