Good, bad, and surprising news regarding VBP.

By now, most people are aware of the Value-Based Purchasing provisions in the Patient Protection and Affordability Act that was signed into law last March.

The good news is that there will be financial incentives for improvement of HCAHPS scores (achievement or attainment).

The bad news is that there's no new money to pay for the incentives.

Through a somewhat complex model, most hospitals will see their base DRG reduced by 1% on October 1, 2012, to fund the incentive payments described in the legislation. This amount will increase in 2014 to 1.25%, 2015 to 1.5%, etc.

Now here's the surprise to many people: while the incentive payments begin (funded by the base DRG reductions ) in 2012, they'll actually be paying the incentives for HCAHPS performance earned in 2011.

This means that effective Oct 1, 2011, your HCAHPS scores will actually start to 'mean something', as the baseline measurement period begins. So, in less than 13 months, the HCAHPS clock really begins ticking.

It'll be more important than ever to have a coherent strategy to manage the patient experience through the involvement of every frontline associate in your building.

My challenge - questions today are:

1. How effective is your current strategy at really improving your HCAHPS scores through enhancing the patient experience?
2. Do your frontline caregivers 'own HCAHPS'?
3. Who is the executive responsible for championing changes and initiating performance improvement?
4. Where do you stand relative to your competitors - have you done a gap-analysis?
5. Have you assessed the dollars at stake for your hospital under VBP?