Nursing Home Value-Based Purchasing Demonstration

Under this demonstration, CMS assessed the performance of participating nursing homes based on selected quality measures. CMS made incentive payment awards to those nursing homes that performed the best or improved the most in terms of quality.

Background

The demonstration was open to free-standing and hospital-based facilities and included beneficiaries who were on a Part A stay as well as those with Part B coverage only. The demonstration was conducted in 3 states: Arizona, New York and Wisconsin.

Each year of the demonstration, CMS assessed each participating nursing home's quality performance based on four domains: staffing, appropriate hospitalizations, minimum data set (MDS) outcomes, and survey deficiencies. CMS awarded points to each nursing home based on how they performed on the measures within each of the domains. These points were summed to produce an overall quality score. For each State, nursing homes with scores in the top 20 percent and homes that were in the top 20 percent in terms of improvement in their scores were eligible for a share of that State's savings pool.

Initiative Details

A payment pool was determined each year for each State based on Medicare savings that resulted from reductions in the growth of Medicare expenditures, primarily from reductions in hospitalizations. CMS anticipated that higher quality of care would result in fewer avoidable hospitalizations and would result in decreases in Medicare-paid hospitalizations and subsequent skilled nursing home stays.

The demonstration began July 1, 2009. The number of participating nursing homes in each State was as follows: Arizona - 41 homes; New York - 79 homes; Wisconsin - 62 homes.

Evaluations

Latest Evaluation Report

Additional Information

Where Health Care Innovation is Happening