Medicare is giving bonuses to a majority of hospitals that it graded on quality, but many of those rewards will be wiped out by penalties the government has issued for other shortcomings, federal data show.
As required by the 2010 health law, the government is taking performance into account when paying hospitals, one of the biggest changes in Medicare’s 50-year-history. This year 1,700 hospitals – 55 percent of those graded – earned higher payments for providing comparatively good care in the federal government’s most comprehensive review of quality. The government measured criteria such as patient satisfaction, lower death rates and how much patients cost Medicare. This incentive program, known as value-based purchasing, led to penalties for 1,360 hospitals.
However, fewer than 800 of the 1,700 hospitals that earned bonuses from this one program will actually receive extra money, according to a Kaiser Health News analysis. That’s because the others are being penalized through two other Medicare quality programs: one punishes hospitals for having too many patients readmitted for follow-up care and the other lowers payments to hospitals where too many patients developed infections during their stays or got hurt in other ways.
When all these incentive programs are combined, the average bonus for large hospitals — those with more than 400 beds — will be nearly $213,000, while the average penalty will be about $1.2 million, according to...
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