Section
705(a) of the NDAA for FY 2017 authorizes the development and implementation
of value-based incentive programs to encourage health care providers
to improve the quality and delivery of services to TRICARE beneficiaries.
The statute further allows the Secretary to adopt value-based incentive
programs conducted by CMS or any other Federal Government, State
Government, or commercial health care program in fulfillment of
the statutory authority granted under this section. In addition,
Title 10, United States Code, Section 1079(i)(2), requires that
the amount to be paid to hospitals, Skilled Nursing Facilities (SNFs),
and other institutional providers under the TRICARE program, “shall
be determined to the extent practicable in accordance with the same
reimbursement rules as apply to payments to providers of services
of the same type under Medicare”. These statutory provisions have
been implemented through an Interim Final Rule (IFR) with Request
for Comment, published in the Federal Register on September 3, 2020,
amending the TRICARE regulation by adding
32 CFR 199.14(a)(1)(iii)(E)(6) to allow adoption
of Medicare's value-based incentive program as required under Section
3001(a) of PL 111–148 (Patient Protection and Affordable Care Act),
which provides for the establishment of the Hospital Value-Based
Purchasing Program (HVBP) described in Section 1886(o) of the Social
Security Act. In adopting the Medicare HVBP adjustments to TRICARE
DRGs, the regulation authorizes the Director, DHA, to provide notice
of the issuance of policies and guidelines adopting such adjustments
together with any variations deemed necessary to address unique
issues involving the beneficiary population or program administration.
All
hospitals that meet the classification criteria for payment under
Title 42 Code of Federal Regulation part 412, Section 412.161, are
considered to be subject to HVBP under the TRICARE program.
4.2 Payment Method
4.2.1 Each year, the Inpatient Prospective
Payment System (IPPS) Final Rule includes a Table of the Actual
Hospital Value-Based Purchasing Program (VBP) Adjustment Factors
for the Fiscal Year. The contractor shall reimburse hospitals subject
to HVBP using HVBP adjustments using the hospital-specific HVBP
adjustment factor to be applied to that fiscal year found in the
current CMS IPPS Final Rule and IPPS Rule webpage. Past year adjustments
are also available on the Medicare HVBP website.
4.2.2 The HVBP adjustment factors within
the IPPS Final Rule Table are organized by Medicare CMS Certification
Number (also known as MCR Number). The contractor shall determine
each hospital’s HVBP adjustment factor using the hospital-specific
CMS Certification Number within 30 days of publication of the IPPS
Final Rule.
4.2.3 The contractor shall be responsible
for classifying the appropriate CMS Certification Number to the
TRICARE inpatient hospital, since the CMS certification number is
not included on the claim.
4.2.4 The contractor shall use the hospital’s
Medicare ID by Tax ID and NPI, however, it is possible for a TRICARE
hospital Tax ID/NPI to have more than one CMS Certification Number.
As a result, the contractor shall identify the correct CMS Certification
number by either Tax ID (or NPI)/Sub ID in order to accurately map
CMS certification numbers to TRICARE facilities.
4.2.5 The contractor
shall use the relevant CMS adjustment rate for hospital claims based
on the date of admission. For example, the CMS adjustment calculated
for FY 2020 would be used for hospital admissions in FY 2020 and
the adjustments for FY 2021 would be used for FY 2021 hospital admissions. See
Figure 1.41-1.
Figure 1.41-1 Example
of Use for CMS HVBP Adjustment Factors
|
Admission Date
|
Discharge Date
|
Adjustment Year
|
|
February 12,
2020
|
February 29,
2020
|
FY 2020
|
|
September 29,
2020
|
October 4, 2020
|
FY 2020
|
|
December 20,
2020
|
January 5, 2020
|
FY 2021
|
|
January 25,
2021
|
February 3,
2021
|
FY 2021
|
4.2.6 The contractor shall apply the hospital’s
HVBP adjustment factor to the base DRG payment amount for each claim,
prior to any adjustments for outliers, Indirect Medical Education
(IDME), or any other adjustments. If a hospital does not have an
adjustment factor listed on the CMS IPPS Final Rule Table, it is
assumed that the hospital does not participate in HVBP and the contractor
shall use a 1.0 HVBP adjustment factor, meaning no net change in
base operating DRG payment. See
Figure 1.41-2.
Figure 1.41-2 Example
of Calculation of Net Change in Base Operating DRG Payment Amount
with HVBP Adjustments
|
1.
Base Payment Amount (Pre-Outlier or other
Adjustments)
|
2.
HVBP Adjustment Factor
|
3.
HVBP Adjustment x Base
Payment (1 x 2)
|
Net Change in
Base Operating DRG Payment Amount (3 - 1)
|
|
$20,000
|
1.023
|
$20,460
|
$20,460 - $20,000
= $460
|
|
$20,000
|
0.998
|
$19,960
|
$19,960 - $20,000
= -$40
|
4.2.7 Each inpatient claim will continue
to be processed using standard IPPS logic for outliers or other
adjustments. The HVBP adjustment as calculated in
paragraph 4.2.5 will
then be either added (if positive value) or subtracted (if negative
value) from the TRICARE allowed amount in order to determine final
claims payment amount. See
Figure 1.41-3.
Figure 1.41-3 Example
of Calculation Final Payment Using HVBP
|
1.
Claim Allowed Amount (Including Outlier,
if applicable, for Case)
|
2.
Net Change in Base Operating DRG Payment Amount
(i.e., HVBP Adjustment Amount)
|
Final Payment Amount
(1 + 2)
|
|
$25,000
|
$50
|
$25,050
|
|
$65,450
|
- $500
|
$64,950
|
|
$4,000
|
$250
|
$4,250
|