Value-based purchasing demo had little impact on Medicare spending, quality: study

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The demonstration failed to make a real impact on savings or quality, researchers said
The demonstration failed to make a real impact on savings or quality, researchers said

The Centers for Medicare & Medicaid Services' Nursing Home Value-Based Purchasing demonstration had little effect on participating facilities' Medicare spending or quality, a new study has found.

The study analyzed administrative and qualitative data from nursing homes in Arizona, New York and Wisconsin, where the demonstration was conducted. Researchers used data from 2008 (before the demonstration began) and from the demonstration period lasting from 2009 to 2012.

Results, which were published on Thursday, showed that Medicare savings were realized in Arizona only over the first year and in Wisconsin only over the first two years. New York facilities, meanwhile, reported no savings.  

Those reported savings were likely a “regression toward the mean,” researchers concluded, reflecting higher baseline spending in Arizona and Wisconsin facilities that moved closer to the average upon later measurements.

Discussions among facility administrators and the research team — which includes investigators from Harvard Medical School, Vanderbilt University and Dartmouth College — showed that few nursing homes engaged in activities to lower expenditures and improve quality as part of the demonstration.

Some also suggested that the quality areas targeted in the demonstration were already being improved as a result of other initiatives or external pressures.

“Most nursing homes did not change their actions because of the demonstration; rather, some hoped to be rewarded for things that they were already doing or thought their involvement in the demonstration would just be an opportunity to learn from other nursing homes, or prepare for what is to come from CMS, moving forward,” the study authors wrote.

Many administrators shared that while they felt the demonstration was a good idea, it lacked the communication, direction and leadership to make a real impact on quality measures.

“One stakeholder summed up the feelings of many demonstration participants saying, ‘This was an absolute missed opportunity,'” researchers wrote. “This stakeholder felt that their nursing home association had a lot to offer in terms of leadership but was only enlisted to help recruit nursing homes and was not consistently invited to listen in on the quarterly demonstration calls.”

Policies related to the Affordable Care Act, such as alternative payment methods and an increased emphasis on the Five-Star Quality Rating System, also may have “swamped any changes” linked to value-based purchasing and led to the reported lack of savings and quality improvement, researchers noted.

The full study was published online in Health Services Research.