Patient Experience Spotlight: The $1 Billion Hospital Pay-for-Performance Incentive

The changes in our healthcare system that link Medicare payments to Pay-for-Performance and patient satisfaction are constantly top-of-mind with hospital administrators and providers. With about $1 billion in payments on the table, it’s an industry preoccupation.

But awareness by consumers/patients is growing also. Newspapers and publications throughout the nation have carried many items, and the Wall Street Journal article, titled US Ties Hospital Payments to Making Patients Happy, threw a bright new spotlight on Patient Experience recently.

Patients and providers appreciate the stakes involved. And the explanation is sharp. “The health law will cut $716 billion in Medicare spending growth over the next decade, the Congressional Budget Office estimates, largely by shaving payments to hospitals and insurers. The patient-satisfaction change isn’t included in that total, as it will move the same pot of money between hospitals. But it uses the same carrots-and-sticks approach as the provisions designed to force spending cuts.

“Nearly $1 billion in payments to hospitals over the next year will be based in part on patient satisfaction, determined by a 27-question government survey administered to patients. Hospitals with high scores will get a bonus payment. Those with low ones will lose money.”

While the government survey system isn’t new, the public—including patients and prospective patients—are now know that their responses now have greater influence. Grady Memorial Hospital in Atlanta serves as a case example in the WSJ article about the ways facilities are courting patient satisfaction.

For example, “doctors are being taught to stop interrupting patients while they are speaking. Nurses recently got hand-held phones so patients can reach them instantly. New bedside comforts include cable sports channel ESPN and a menu featuring wild salmon.” Other facility and procedural changes include upgrading to flat screen TVs, and nurses making rounds more frequently to check on patients.

According to the article, Medicare may consider adjustments to the survey questions, which many medical professionals consider unfair. Clearly, it’s a topic of considerable discussion among hospital executives and industry professionals. “Older hospitals in inner cities, or facilities that tend to accept patients through cramped and busy emergency rooms, say their scores automatically suffer through no fault of their own,” the article reports.

Some providers feel that “consumer awareness” isn’t always properly informed. “Doctors and nurses say the customer isn’t always right in medicine. Patients sometimes arrive armed with treatment ideas culled from the Internet and can leave unsatisfied when the doctor won’t give them what they want.”

There’s more discussion of the pros and cons in the in-depth Wall Street Journal article. And, from a marketing and advertising perspective, hospitals will be working on shaping expectations as consumer awareness continues to grow.

Lonnie Hirsch


About Lonnie Hirsch

Co-Founder of Healthcare Success Strategies, Lonnie has consulted for over 2,000 health care clients during his 20-year career. Lonnie writes for many healthcare publications, and also has spoken at hundreds of venues nationally. His topics include patient experience, customer service, marketing, branding and business development.

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