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
|