Rural providers should be required to participate in federal pay-for-performance programs, says report

"Rural providers should be required to participate in federal pay-for-performance programs, but the measurements should reflect rural patient volume and demographics and practice size," says a report requested by the U.S. Department of Health and Human Services, Shannon Muchmore reports for Modern Healthcare. The report by the National Quality Forum was designed "to determine how to deal with the difficulties in using performance measures to judge rural practitioners for Centers for Medicare and Medicaid Services (CMS) pay-for-performance programs."

The report "recommended a two- to four-year phased-in approach for including rural providers in federal quality-improvement initiatives," writes Muchmore. "Programs such as Medicare's value-based purchasing and readmissions reduction programs generally exclude rural providers because they're limited to hospitals paid under the inpatient prospective-payment system. Similarly, the value-based payment modifier for physicians is limited to those in practices with at least 100 clinicians." Initiatives could include paying rural hospitals for "reporting quality data and transitioning to public reporting requirements before pay-for-performance implementation."

The report, which suggests that CMS should use performance-based payment incentives but not institute penalties, "recommends developing quality measures with rural providers in mind," Muchmore writes. "These measures would need to consider the small patient populations as well as the challenges posed by heterogeneous rural populations. The data would have to be easily gathered and reported by small staffs."

The report was met with mixed reviews. The American Hospital Association said "that mandatory participation in value-based performance programs is premature and developing a set of measures that examines the right issues in the right way will be difficult" and that "adopting payment incentives without penalties might be politically unfeasible," Muchmore writes. "The National Organization of State Offices of Rural Health said any measures would have to be adjusted to reflect the effects of the rural provider shortage on population health and that they should focus on assessing the quality of primary care and procedures actually conducted in rural settings."

Already 50 rural hospitals have closed this decade, and another 283 are in danger of closing, says an October report from iVantage Health Analytics. (Read more)