June 1st, 2011 – Next year the US government’s Medicare program will start tracking how hospitals handle claims and reward hospitals that keep costs down and penalize those that are expensive.
In calculating Medicare spending per beneficiary, it will measure costs generated during a hospital stay, the three days before it and the 90 days afterward.
The desired result is to encourage hospitals to coordinate care “in an efficient manner over an extended time period.” Medicare will begin computing performance scores in July, for monetary rewards and penalties that start in October 2012.
Then, based on the Hospitals score, Medicare would pay a higher or lower percentage of each claim filed by the hospital. The idea is that this will reward high quality and efficient treatment and discourage behavior that can result in expensive “extra” treatment for things like infections.
Charles N. Kahn III, president of the Federation of American Hospitals, which represents investor-owned companies, said he supported efforts to pay hospitals according to their performance. But he said the Obama administration was “off track” in trying to hold hospitals accountable for what Medicare spends on patients two or three months after they leave the hospital.