Pay-for-Performance and Quality Improvement in Rural Hospitals

Funder:	Office of Rural Health Policy (ORHP)
Research center:	Upper Midwest Rural Health Research Center Phone: 612.624.8618
Lead researcher:	Ira Moscovice, PhD
Contact:	Ira Moscovice, PhD, 612.624.8618, mosco001@umn.edu
Project funded:	September 2004
Project completed:	February 2007
Topics:	Health care financing Hospitals and clinics Quality

This project has three primary purposes:

• To estimate the impact on rural hospitals in the U.S. of a pay-for-performance (PFP) program similar to the CMS-sponsored Premier, Inc. Hospital Quality Incentive Demonstration
• To complete a synthesis of the major factors that will influence the inclusion of rural hospitals in PFP programs
• To make recommendations for the design of PFP programs that will appropriately reward rural hospitals for improving quality.

This project will empirically assess how rural hospitals in the U.S. would fare financially (i.e., receive bonus payments, be eligible for reduced DRG payments) if they participated in the CMS-sponsored Premier HQID; identify and thoroughly examine the key factors that facilitate or constrain rural hospital participation in pay for performance programs; and describe options for the design of pay for performance programs that are relevant for rural hospitals that seek quality improvement. This study will use data from several sources, including data on the CMS 7th Scope of Work measures and data from a telephone survey of key representatives from major stakeholders (e.g., CMS, Premier, AHA, rural hospitals, rural relevant physician associations) involved with pay-for-performance projects.

Publications

• Does Hospital Size Affect Our Ability to Accurately Identify High Quality Care in Pay-for-Performance Programs?
  Report Number: Policy Brief
  Date: 05 / 2007
  Discusses whether hospital size impacts the ability to identify hospitals' performance in a pay-for-performance demonstration project based on hospital rankings. A full report is also available.
• Hospital Size, Uncertainty and Pay-for-Performance
  Author(s): Gestur Davidson, Ira Moscovice, Denise Remus
  Report Number: Working Paper No. 3
  Date: 02 / 2007
  Examines whether hospital size impacts the ability to identify hospitals' performance in a pay-for-performance demonstration project based on hospital rankings. Using data from the Premier Hospital Quality Incentive Demonstration and the Centers for Medicare and Medicaid Services' Hospital Compare, the report found that the smallest hospitals would, on average, experience five to seven times more uncertainty than the largest hospitals concerning their true relative performance for heart failure, pneumonia, and acute myocardial infarction. The authors conclude that all estimates of rank need to include adequate measures of uncertainty of those estimates.
• Implementation of Pay-For-Performance in Rural Hospitals: Lessons from the Hospital Quality Incentive Demonstration Project (Brief)
  Author(s): Walter Gregg, Ira Moscovice, Denise Remus
  Report Number: Policy Brief No. 2
  Date: 11 / 2006
  Overview of findings of a national study to identify institutional, organizational, and environmental factors that influence the experience of rural hospitals in the Hospital Quality Incentive Demonstration (HQID) project.
• Implementation of Pay-For-Performance in Rural Hospitals: Lessons from the Hospital Quality Incentive Demonstration Project (Full Report)
  Author(s): Walter Gregg, Ira Moscovice, Denise Remus
  Report Number: Working Paper No. 2
  Date: 09 / 2006
  Reports the findings of a national study designed to identify institutional, organizational, and environmental factors that influence the experience of rural hospitals in the Hospital Quality Incentive Demonstration Project.