American College Of Surgeons - Inspiring Quality: Highest Standards, Better Outcomes

Hospital Value-Based Purchasing

Under the Patient Protection and Affordable Care Act (ACA), the Secretary of the Department of Health and Human Services is required to establish a hospital value-based purchasing (VBP) program under which value-based incentive payments are made to hospitals that meet certain performance standards in each fiscal year (FY). The program will apply to payments for discharges occurring on or after October 1, 2012. This program applies to most hospitals with the exception of psychiatric hospitals, rehabilitation hospitals, children’s hospitals, long-term hospitals, and certain cancer treatment and research facilities. Under this program, payment to hospitals will be reduced by 1 percent, and hospitals who achieve the quality measures specified for the program will receive a higher payment. The program was implemented via a Hospital VPB rule in 2011 (see below). Updates to the program are found in the FY 2013 Inpatient Prospective Payment System (IPPS) rule released in April 2012 (also below). Because a large percentage of surgical care takes place in the inpatient hospital environment, the American College of Surgeons (ACS) has an interest in the CMS Hospital VBP Program.

Hospital Value-Based Purchasing Rules