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Since 2010 the ACA has established a Hospital Value‐Based Purchasing (VBP) program for traditional Medicare participants. No longer do hospitals receive reimbursement for care based exclusively on the quantity of services delivered. This program offers financial incentives to hospitals to improve the quality of care provided to Medicare patients through CMS regulations implemented through the Hospital Inpatient Prospective Payment System (IPPS). This method of payment rewards institutions based on how closely they adhere to best clinical practice, as well as on their improvement of the patients’ experiences of care during hospitalization. The Hospital VBP program works for Medicare patients by creating disincentives and rewarding reductions during acute care inpatient stays based upon reviewing the following:

 Eliminating or reducing adverse events (health care errors resulting in patient harm).

 Adopting evidence‐based care standards and protocols in order to obtain the best outcomes for Medicare patients.

 Incentivizing hospitals to develop processes that improve patient experience.

 Increasing the transparency of care quality for consumers, clinicians, and others.

 Recognizing hospitals that provide high‐quality care at a lower cost to Medicare.

CMS withholds participating hospitals’ Medicare payments by a percentage specified by law (2%). It uses the estimated total amount of those reductions to fund value‐based incentive payments to hospitals based on their performance in the program. CMS applies the net result of the reduction and the incentive payment amount in the fiscal year associated with the performance period. In keeping with the intent of transparency and accountability, hospital performance is publicly reported using a quality star rating system in Hospital Compare (https://www.medicare.gov/hospitalcompare/About/Complications.html). The Hospital Inpatient Quality Reporting Program is based on measures relating to mortality and complications; health care–associated infections; patient safety, patient experience; process; and efficiency and cost reduction. Early in the development of this process stakeholders and quality alliances, including nursing, submitted public comments regarding the proposed rules that would implement the VBP provision. Fiscal year (FY) 2020 rules were based on eligible hospital discharges that occurred between July 1, 2015 and June 30, 2018. Rates of readmission include measures of unplanned hospital visits after an outpatient procedure and hospital return days, and the readmission measures are estimates of the rate of unplanned readmission to an acute care hospital in the 30 days after discharge from hospitalization. Patients may have had an unplanned readmission for any reason (https://www.medicare.gov/hospitalcompare/Data/Hospital‐returns.html).

The work of developing and endorsing performance measures that meet the intent of this provision are the result of work in which various entities, alliances, and individual stakeholder organizations continue to engage. Measure development remains some of the more important and most challenging work in policy related to ACA. Measures, if appropriately defined, can quantify the quality of the care delivered for payment, and they also focus attention on issues that are major factors in whether patients survive medical or surgical interventions and hospitalizations. Measurement burden is a significant issue that has led to much greater reliance on only using measures that can be electronically collected. This burden and the realization that large number of measures being reported have resulted in significant measure‐reduction efforts and elimination of some measures that are most relevant to nursing care, but can be difficult to capture in electronic medical records. Equally challenging is the expensive pilot testing and subsequent endorsement and measure maintenance processes to demonstrate the adequacy and accuracy of such measures for reporting to the public, and for payment. Nurses have great opportunities for influence in the development and adoption of measures that reflect the outcomes and patient experiences of care, including care delivered by nurses.