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Title III

So – we are moving into Title III of the PPACA. If you recall, we already did Title IX, and of course Titles I and II. They are not evenly distributed.

Title III is “Improving the Quality and Efficiency of Health Care”.

The first subtitle looks at the delivery system, and the first part of the first subtitle looks at “Linking Payment to Quality Outcomes in Medicare”. Look out olds!

Section 3001 sets up hospital value-based purchasing programs. Even though the name is confusing, it basically gives money to hospitals as an incentive to improve quality in a few key areas, namely acute myocardial infarction (heart attack), heart failure, pneumonia, surgeries, and healthcare-acquired infections. After 2014, these payments will include measures of efficiency, given by the spending per beneficiary.

Section 3002 creates improvements in the physician quality reporting system. The biggest improvement is that it goes from an incentive to participate, to a penalty if you don’t. Which, I suppose, is an improvement from the government’s point of view.

Section 3003 improves the physician feedback system, used to identify issues of quality with physicians. It should be noted that these are physicians that receive money from Medicare and/or Medicaid.

Section 3004 improves quality reporting for long term care facilities.

Section 3005 discusses quality reporting for PPS-exempt cancer hospitals. PPS is the prospective payment system, which reimburses hospitals based on diagnosis codes when the patient enters the hospital. PPS-exempt hospitals, are well, exempt from that – since cancer patients may develop many more diagnoses while in the hospital. There are 11 of these in the US.

Section 3006 sets up a plan similar to 3001, only for skilled nursing facilities and home-health care agencies. You have to remember that when Medicare was set up, most of the health care of the elderly took place in a hospital. So everything is sort of set up around that idea. But that has changed in the 50+ years since Medicare was set up.

Section 3007 establishes payment modifiers for physicians based on the quality of care.

Section 3008 adjusts payments for people who acquire infections in the hospital. It reduces them by 1%. I would be interested in some experimental economics study about whether a 1% reduction was enough incentive to alter behavior.


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