Organizational Strategic Goal Setting for Hospital under Value-based Purchasing

VBP will be introduced in 2013. Hospitals will be assessed on 17 clinical measures and on 8 satisfaction measures compared against national performance during a baseline period and can score either on achievement or improvement from the baseline period. Hospitals are at significant risk of losing revenue since VBP is a zero-sum proposition with a percentage of overall payment will be withheld and redistributed based on performance. We worked with a hospital system in Kentucky to develop an organizational approach to performance improvement that focused on VBP methodology. We conducted educational sessions with hospital system executive leadership and educated health system board on payment reform and pay for performance. Building on a VBP calculator we then worked with the hospital system leadership to develop dashboards that identify improvement opportunities across the hospital system based on financial exposure and opportunity. Each hospital was encouraged to select one clinical and one satisfaction measures scoring below the achievement threshold under VBP and set a goal that would result in scoring at least one point under the achievement methodology when VBP will be implemented. We worked with individual hospital leadership on VBP methodology, measure selection, improvement planning and implementation and monitoring improvement over time. With performance-based payment reform already in place in the United States and interest in many countries, analyzing performance, goal setting, estimating financial exposure and maximizing financial rewards under such schemes will be on great importance. We present an early case study how this can be accomplished.