CMS posts final Hospital VBP Program adjustment factors for FY 2016

The Centers for Medicare & Medicaid Services today posted the final incentive payment adjustment factors for the fiscal year 2016 Hospital Value-Based Purchasing Program, which are being used to adjust base operating Medicare Severity Diagnosis-Related Group payments to eligible hospitals for discharges this year. As required by law, base operating MS-DRG payments to eligible inpatient prospective payment system hospitals are being reduced by 1.75% in FY 2016 to fund an estimated $1.5 billion in incentive payments for the VBP program. The actual VBP amount earned by each hospital depends on its Total Performance Score and incentive payment percentage. “The highest performing hospital in FY 2016 will receive a net change in payments of slightly more than 3% after 1.75% is withheld,” CMS said. “The worst performing hospital, receiving a Total Performance Score of 0, will see the maximum reduction of 1.75% and will not receive an incentive payment.” To view the final FY 2016 adjustment factors, see Table 16B at www.cms.gov.