This is a rewrite of a CQ article published in Aug. 8, 2016, intended to make this piece more accessible to a general audience. This original story also appeared in the Aug. 15 issue of Commonwealth Fund’s Washington Health Policy Week in Review.
CMS Faces Continued Pushback on Judging Care of Poor Patients
By Kerry Dooley Young
August 8, 2016— Federal efforts to create consumer-friendly ratings for hospitals renewed debate about whether to adjust these measures to reflect dire poverty seen in many communities. It’s an issue that’s certain to pervade fights over health care payments for many years.
Three major medical groups last month said that the Centers for Medicare and Medicaid Services’ new simplified star ratings are unfair to hospitals that treat many people who are homeless or struggling financially. The American Hospital Association, the Federation of American Hospitals and the Association of American Medical Colleges asked CMS to consider making allowances in the star ratings system for hospitals that have large numbers of patients with little or no income. These patients often struggle to get transportation for follow-up medical visits and to buy food and medicine, resulting in more frequent readmissions, even if the quality of care provided within hospitals’ walls was quite good, according to the groups.
So far, CMS officials aren’t ready to heed these requests and factor in socioeconomic status in its rating system. The agency says it wants to avoid making changes that would “mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations.” CMS repeated this exact phrase in three of its most significant annual documents, its massive payment rules for Medicare. These are used to routinely tweaks hundreds of CMS policies each year, while also establishing how much doctors and other providers of medical care can collect from Medicare for their services. CMS rebuffed bids for adjustments to the new star ratings in the fiscal 2017 rules covering services provided to patients in hospitals as well as those covering care provided at skilled nursing and inpatient rehabilitation centers.
Given CMS’ stance, medical groups will appeal again to members of Congress after the August recess to try to force a change in Medicare policy and obtain more leniency for results seen in poor communities. The Senate Finance Committee will face pressure to move a House-passed Medicare package (HR 5273), which includes a bid to address concerns about readmission penalties for hospitals. The bill proposes a comparison that would group hospitals that serve significant populations of low-income elderly patients who qualify for both the Medicare and Medicaid program.
Ashish K. Jha, a Harvard University researcher and doctor who has published widely on the question of socioeconomic differences and quality measures, said he’s sympathetic to CMS’s aim of spurring improvements by keeping its current standards in place. The agency has said this approach aids in tracking and comparing outcomes. Still, Jha argues for a need to make allowances for hospitals that serve many poor people.
“I get it. I like it,” Jha said of CMS’s goal. “But we need to acknowledge that the job of the hospital is very different when you have lots of poor people and homeless people versus wealthy, well-to-do patients. And if you agree that the job is very different, then you should be held responsible in different ways.”
In recent payment rules, CMS has acknowledged that treating large numbers of poor people may affect quality ratings. Agency officials said they are monitoring a two-year test by the National Quality Forum to determine if risk adjusting for patient income may be appropriate. Separately, an in-house policy shop for the Department of Health and Human Services (HHS) is conducting its own research.
This same debate over judging quality of care provided to the poor is likely to arise with the implementation of another major Medicare payment change, last year’s overhaul of the giant health program’s reimbursements for doctors (PL 114-10), said David Nerenz, a researcher at Detroit’s Henry Ford Health System. CMS is in the midst of establishing an initial framework, known as the merit-based incentive payment system, or MIPS. It’s intended to peg Medicare reimbursement to judgments about the quality of care delivered.
Doctors in poor areas might find it more difficult in the future to obtain the kinds of scores needed to prevent cuts in their Medicare pay, due to circumstances they perceive to be beyond their control, Nerenz said. The stakes may be higher for patients if federal officials discourage doctors from treating poor patients through the design of the MIPS system than if they don’t heed the hospitals’ concerns, Nerenz said.
“It’s hard to pick up and move a hospital that’s been for a hundred years in an inner-city area, but doctors are more mobile,” Nerenz said. “You may find a real problem in finding physicians willing to go or stay in underserved areas.”