ACA, ACOs, HCAHPS and VBP: What Does It All Mean?

In the current healthcare economy the alphabet soup of acronyms are flying around worse than ever. While we in EMS are no strangers to acronyms, in order to have a meaningful conversation with our community partners—especially those in hospitals, where there are serious reimbursement implications—we must educate ourselves to stay relevant.

ACA

Let’s start with the most important one: the ACA or Affordable Care Act, otherwise known as Obamacare. Known formally as the Patient Protection and Affordable Care Act, it was signed into law March 23, 2010 by President Obama. Many of the other acronyms discussed in this article will refer back to the ACA. The ACA created the ACOs.

ACO

What’s an ACO? ACO stands for Accountable Care Organizations. They are groups of doctors, hospitals and other health care providers that coordinate to decrease costs and increase the quality of healthcare they provide to patients. Primary care physicians are the only essential component of an ACO, but many hospitals are trying to become ACOs. In a nutshell, the ACO receives a bundled payment for all services provided for a patient. This includes transport by EMS (if warranted), the ED visit, any diagnostic/radiographic tests, treatments, physician payments, hospital stay, surgery, etc. If the ACO can provide care for less than the bundled payment amount for that patient, they make a profit. If they can’t, they financially lose and should work on creating better efficiency within their system.

VBP

Value Based Purchasing, also known as VBP, is a methodology the federal government is using to amend payments to hospitals, and the schedule of payments gets more severe every year. In 2013, 1% of the Medicare payments to all hospitals were impacted, and in 2014 it is now 1.25%. This may not seem like much, but it is a substantial amount of money for hospitals that already operate on thin margins. VBP is calculated by taking into account the hospital’s HCAHPS scores and Core Measures (defined below). VBP is a zero sum gain within all the hospitals in the country; this means it was created to be cost-neutral. Essentially, hospitals that perform well are incentivized with better payments, whereas poorly performing hospitals lose money. In order to receive the full 1.25% back, hospitals must perform at or above the average level (50^th percentile). If they perform at or above the 95^th percentile, they are guaranteed to make their 1.25% and more as a financial bonus. If they are between the two, there are calculations to determine how much they make. Remember that 1.25% increases every year; in 2015 it will be 1.50%.

Core Measures

Core Measures are clinical measures that hospitals must track and report out publicly as part of the VBP calculation. There are multiple Core Measures—too many to list in detail in this article. They initially focused on care surrounding pneumonia, heart failure, acute myocardial infarction and surgical processes. The hospital’s performance on these indicators is one piece of VBP.

HCAHPS

The other major piece of VBP is HCAHPS, which stands for Hospital Consumer Assessment of Healthcare Providers and Systems. It is a required patient experience measurement that surveys patients’ perceptions of care at a hospital. There are eight domains within HCAHPS: communication with nurses; communication with physicians; discharge information; cleanliness and quietness; responsiveness of staff; pain management; communication about medications; hospital rating and whether they would recommend. These surveys are administered after the patient is discharged from the hospital and handled in most cases by a third-party vendor. To view any hospital in the country’s performance on these metrics go to: https://www.medicare.gov/hospitalcompare/search.html.

This is not an exhaustive list, as there are many things keeping hospital administrators up at night. These include things like thirty re-admission penalties and hospital-acquired infection rates, which all fall into the quality purview. To view a hospital's readmission rate see www.medicare.gov/hospitalcompare.

Healthcare constantly changes, and as a profession, medicine continues to evolve and to set the bar higher than it was in the past. It is imperative that the EMS leaders stay abreast of the new terminology and trends affecting hospitals and the community to create stronger partnerships through better communication and understanding.

Patrick Pianezza, MHA, NREMT-P, is a consultant experienced with Studer, HCAPS, Gallup and Press Ganey principles. Along with nearly a decade of experience in the prehospital arena, he has worked for Johns Hopkins Hospital and Studer Group. He is currently the manager of service excellence for San Joaquin Community Hospital in Bakersfield, CA. E-mail ppianezza@gmail.com.