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Value-Based Purchasing (VBP) is a CMS program which aims to improve the quality of care through financial rewards and penalties. The quality of care provided by a hospital, rather than the quantity of services provided, determine the incentive payments.

Performance in four quality measurement domains, as compared to their peers, dictate a hospital’s score:

  • Clinical Care (25%)
  • Safety (25%)
  • Person and Community Engagement (25%)
  • Efficiency and Cost Reduction (25%)

Hospitals with a final score that ranks above the national median receive a percentage bonus to their Medicare reimbursements in the following fiscal year. The incentive payments to hospitals are paid for by penalizing hospitals with scores below the median. So far in 2019, 21 states scored higher than the national average of 39.5.

Nationwide, Average VBP scores ranged from a low of 32.4 to a high of 51.3. North Dakota had the lowest median score at 32.4, and Minnesota had the highest score with 51.3 out of 100. Utah scored closest to the overall average, with a score of 39.4. Case mix index (CMI) does not appear to strongly influence VBP performance, with all states reporting between a 1.0 and 1.5 CMI.

The top 5 states with the highest VBP scores — Minnesota, Oregon, Alaska, Wyoming, and Montana — reported average CMIs between 1.1 and 1.4.

Average State Value-Based Purchasing Score & Selected Metrics by Score

  State Performance Score Net Patient Revenue (M) Case Mix Index Staffed Beds Discharges

1.

MN

51.38

$290,394,000

1.28

168.80

7,119

2.

OR

50.80

$334,179,708

1.45

201.54

8,963

3.

AK

49.76

$161,567,983

1.26

83.18

3,164

4.

WY

49.42

$73,513,392

1.27

61.24

1,848

5.

MT

47.51

$92,696,618

1.13

65.86

2,157

6.

WI

44.95

$250,464,944

1.38

150.92

6,235

7.

HI

44.94

$231,748,184

1.36

153.30

6,878

8.

ME

44.00

$254,612,960

1.28

137.57

5,652

9.

SD

43.85

$175,450,398

1.18

115.99

3,820

10.

VT

43.11

$274,018,752

1.22

115.00

5,691

11.

IA

43.01

$145,526,536

1.20

122.55

5,003

12.

MI

42.18

$420,740,575

1.42

292.20

14,627

13.

OK

42.09

$122,714,892

1.36

124.30

4,658

14.

NM

41.42

$172,182,520

1.30

133.93

5,145

15.

KS

41.10

$94,324,215

1.24

86.56

3,243

16.

CO

40.96

$290,691,320

1.44

171.56

7,709

17.

VA

40.84

$307,359,257

1.43

269.62

10,705

18.

WV

40.35

$177,235,806.90

1.27

158.50

5,935

19.

NC

40.21

$426,390,381

1.43

285.21

13,823

20.

MO

40.17

$424,171,223.73

1.34

346.03

15,074

21.

UT

39.44

$262,985,848

1.48

145.64

7,275

22.

SC

39.12

$321,134,896

1.42

243.10

11,312

23.

DE

39.05

$436,854,520

1.47

234.37

12,680

24.

ID

39.03

$167,920,535

1.38

94.74

4,263

25.

AZ

38.94

$264,669,700

1.46

197.80

9,451

26

LA

38.83

$111,199,676

1.32

125.74

4,280

27.

WA

38.63

$486,286,406

1.44

264.45

13,741

28.

OH

38.56

$361,895,541

1.43

236.06

11,089

29.

IL

37.87

$495,210,688

1.37

367.32

15,932

30.

IN

37.86

$238,330,441

1.40

172.25

7,204

31.

GA

37.48

$256,916,622

1.37

211.57

9,387

32.

CA

37.38

$499,595,343

1.54

320.73

15,313

33.

MA

37.02

$509,076,945

1.34

282.39

12,826

34.

CT

36.89

$546,164,983

1.39

296.57

14,726

35.

KY

36.69

$212,393,380

1.30

232.71

8,189

36.

NE

36.54

$105,942,444

1.27

94.22

3,374

37.

NY

36.41

$609,451,711

1.40

359.38

17,206

38.

PA

36.13

$420,450,974

1.42

363.10

14,605

39.

AL

35.81

$175,986,121

1.31

240.86

9,274

40.

MS

35.26

$99,807,855

1.20

148.37

4,149

41.

RI

35.12

$421,065,967

1.33

359.90

12,364

42.

NH

34.81

$233,511,108.20

1.35

118.38

5,371

43.

TX

34.62

$236,996,763

1.39

228.68

9,731

44.

TN

34.56

$632,160,067

1.38

608.69

28,471

45.

NJ

33.47

$392,876,973

1.48

337.27

14,403

46.

FL

33.21

$347,829,267

1.44

312.86

16,093

47.

AR

32.97

$106,283,066

1.30

129.03

5,117

48.

NV

32.88

$211,823,248

1.34

177.32

9,811

49.

ND

32.44

$110,308,291

1.07

85.19

2,996

50.

MD

N/A

$533,847,684

1.44

323.13

17,110

 

Average

39.57

$290,579,215

1.35

211.11

9,304

Fig 1. Data from Definitive Healthcare based on CMS Quality Metrics Update as of April 2019.