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Hospitals begin to feel the impact of Obamacare

By on October 2, 2012

Sarah Kliff looks at two reforms to hospital payments in President Obama’s health care reform law that went into effect on Monday.

“The first one cuts payments to hospitals for preventable re-admissions in Medicare. That’s when a senior turns up at a hospital within one month of a previous visit with a problem that should have been dealt with on their first visit — or, perhaps, was caused by that first visit.”

“The second one, called Value Based Purchasing, also looks to nudge hospitals to delivering higher-quality care. It begins with the federal government withholding 1 percent of payments to about 3,000 hospitals that deliver acute care. That money goes into a sort of pool, with about $850 million at stake. The hospitals that do well on certain quality metrics will get paid even more out of the pool than they put in — in other words, they get a raise. Those that do poorly on quality may not get anything back out of the pool — they deserve a rate cut, the thinking goes, because they are not delivering high-enough-quality care.”

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