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
of Defense 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 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
(PPACA)),
which provides for the establishment of the
HVBP
Program 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 Regulations (CFR) part
412, Section 412.161, are subject to
HVBP under the TRICARE Program.
4.2 Payment
Method
4.2.1 Each year, the IPPS
Final Rule includes a “Table of the
Actual Hospital Value-Based Purchasing Program (VBP) Adjustment
Factors” for the FY.
The contractor shall reimburse hospitals subject to HVBP using HVBP
adjustments using the hospital-specific HVBP adjustment factor applied that FY 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 (CCN).
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 classify the appropriate CCN to
the TRICARE inpatient hospital, since the CCN is
not included on the claim.
4.2.4 The contractor
shall use the hospital’s Medicare identification by
Tax ID and National Provider Identifier (NPI); however,
it is possible for a TRICARE hospital Tax ID/NPI to have more than
one CCN. As a result, the contractor
shall identify the correct CCN by either
Tax ID (or NPI)/Sub ID to accurately
map CCNs 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
shall be used for hospital admissions
in FY 2020 and the adjustments for FY 2021
shall 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, 2021
|
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
shall continue to be processed
using standard IPPS logic for outliers or other adjustments. The
HVBP adjustment as calculated in
paragraph 4.2.5 is then
either
added (if positive value) or subtracted (if negative value) from
the TRICARE allowed amount
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
|