Healthcare Insights

Top 20 hospitals in value-based purchasing

The Hospital Value-Based Purchasing (VBP) Program is one of several value-based care programs introduced by the Affordable Care Act. Value-based care links provider reimbursement to the quality of care they provide.

The Hospital VBP Program rewards hospitals that provide high-quality care to Medicare patients. Under the program, hospitals receive payment adjustments based on the quality of care the hospitals deliver to patients during inpatient stays.

The payments are supported through a 2% reduction of Diagnosis-Related Group funding for participating hospitals. The money that is withheld is then distributed between eligible facilities according to performance.

The performance measurement domains for the 2021 Hospital VBP Program are:

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

Hospitals may earn an increase, decrease, or no change to their Medicare reimbursements for the following fiscal year. The actual amount of incentive payments a hospital earns is also linked to the total amount available under the program.

Top 20 hospitals by revenue adjustment due to value-based purchasing adjustment

Rank Hospital name  Definitive ID  Est FY 2021 revenue adjustment   Medicare FY 2021 VBP adjustment  Net patient revenue  Staffed beds  Explore dataset
Mayo Clinic Hospital - Saint Marys Campus (MN)   2191  $5,236,286   1.69%  $3,317,828,896   1,143  Explore
 AdventHealth Orlando (FL)  873  $3,200,929   0.90%  $5,004,081,001   2,247  Explore
Hospital for Special Surgery (NY)  2840  $2,378,354   1.95%  $1,026,986,404   205  Explore
Mayo Clinic Hospital – Arizona (AZ)  178  $2,292,448   1.91%  $2,066,052,128   302  Explore
St Francis Hospital & Heart Center (NY)  2830  $2,110,018   1.18%  $884,418,262   364  Explore
Cleveland Clinic Main Campus (OH)  3120  $1,970,337   0.82%  $6,037,196,525   1,326  Explore
Tisch Hospital (NY)  2843  $1,961,907   0.63%  $6,273,707,636   725  Explore
Evanston Hospital (IL)  1154  $1,792,858   0.94%  $1,730,812,209   354  Explore
Oroville Hospital (CA)  309  $1,495,204   2.22%  $347,274,293   153  Explore
10 FirstHealth Moore Regional Hospital (NC)  3011  $1,480,053   1.37%  $777,631,182   412  Explore
11 Virginia Mason Seattle Medical Center (WA)  4381  $1,348,702   1.64%  $1,166,266,808   231  Explore
12 Massachusetts General Hospital (MA)  1973  $1,237,804   0.41%  $3,376,488,407   995  Explore
13 Rush University Medical Center (IL)  1149  $1,215,931   0.85%  $1,992,372,740   592  Explore
14 Providence St Patrick Hospital (MT)  2475  $1,199,687   1.90%  $385,409,968   209  Explore
15 UNC Rex Hospital ((NC)  3039  $1,194,304   1.00%  $1,216,062,000   439  Explore
16  John Muir Health - Walnut Creek Medical Center (CA)  320  $1,103,312   1.00%  $1,082,908,598   506  Explore
17 University Hospital (WI)  4493  $1,082,060   0.69%  $2,324,088,319   606  Explore
18 Mercy Hospital (MN)  2119  $1,047,689   1.11%  $763,638,199   461  Explore
19 Munson Medical Center (MI)  2018  $1,002,779   1.13%  $669,547,434   399  Explore
20 Mayo Clinic Hospital – Florida (FL)  2119  $992,203  1.03%  $986,907,022  304  Explore

Fig 1. Data is from the Definitive Healthcare HospitalView product. Revenue adjustment is estimated 2021 data. Net patient revenue and staffed beds are 2020 data. Based on the most recent CMS data update.

Which hospitals had the highest positive revenue adjustment due to VBP?

Overall, more than half of hospitals received positive adjustments in fiscal year 2021. For hospitals receiving bonuses, the average adjustment rate was 0.69%, with an average estimated increase in revenue of about $155,015.

Hospitals with high positive adjustment rates tended to be smaller. Most facilities that earned rates over 1% had fewer than 70 beds.

Among penalized hospitals, the average adjustment was -0.45%, with an average estimated revenue decrease of nearly $191,992. Compared to hospitals with positive rate adjustments, the facilities were usually larger, averaging 265 staffed beds compared with 176.

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