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What You Should Know About the Biggest Health Care Payer in the U.S.

Information about the National Voluntary Quality Initiative

The Centers for Medicaid and Medicare Services (CMS), a division of the U.S. Health and Human Services Department (USHHS), oversees the operation of the Medicare and Medicaid programs.

As the biggest health care payer in the land, CMS sets the standards for hospitals that care for Medicare and Medicaid patients. Most U.S. hospitals meet these standards. In a January news release, *Dennis Smith, the Acting Administrator of CMS, emphasized the importance of publicly reporting hospital quality measures.

CMS began the National Voluntary Hospital Reporting Initiative in 2003, and initially got poor participation from hospitals. On October 9, 2003, when the first quality measures were reported to the public, the former Administrator of CMS scolded hospitals for failing to keep their “promise” to voluntarily report information and threatened to make it mandatory. Of the 4143 eligible short-term acute hospitals, only 1238 actually volunteered to report. However, at that time, only 415 hospitals had actually reported information about their quality of care to the agency.

This is not an ideal situation for consumers who are trying to compare hospitals. If their local hospital does not participate and only the hospitals that have the best outcomes are willing to turn in the information, the quality picture for consumers will be seriously out of focus.

In late 2003, Congress passed legislation that directs CMS to pay hospitals more if they have voluntarily submitted data to the National Voluntary Hospital Reporting Initiative (the increase is 0.4%). This could provide the incentive for hospitals to submit data. However, we will not know the impact until some time has passed.


*Secretary Tommy Thompson heads up the USHHS and Dennis Smith is the current Acting Administrator for CMS.
Click here for CMS guidelines on hospital quality
Click here for Medicare National Voluntary Hospital Reporting Initiative Home Page