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The Centers for Medicare & Medicaid Services (CMS) today announced the guidelines hospitals should use in submitting their quality performance data to comply with Section 501 the Medicare Prescription Drug, Improvement and Modernization Act (MMA). Hospitals that do not submit performance data for 10 quality measures will receive 0.4 percent smaller Medicare payments in fiscal year 2005 than hospitals that do report quality data.

"Public reporting of quality measures is a mainstay of the administration’s Quality Reporting Initiative," CMS Acting Administrator Dennis Smith said. "The hospital industry shares this commitment and got the ball rolling with their National Voluntary Hospital Reporting Initiative. Now, Congress has endorsed the public-private commitment to quality reporting by requiring Medicare to make higher payments to those hospitals that submit this data."

CMS has notified hospitals that in order to qualify for the full monetary update, they must sign up with the Quality Improvement Organizations’ data warehouse by June 1, 2004 and transmit the required data there by July 1, 2004, which will reflect patient discharges during the most recent quarter available. Hospitals whose data submission is started but not completed by July 1 will be allowed a 30-day grace period to complete that data submission.

"We are working closely with the American Hospital Association, the Federation of American Hospitals and others to ensure that hospitals are fully aware of these requirements," Smith said. " Today’s notice is especially important for those hospitals that have not yet begun to work with us in submitting and reporting their data, so that they ensure that they receive their full monetary update for 2005. For those already reporting as part of the National Voluntary effort, they just need to continue."

CMS notes that hospitals are to submit data for all patients, not just Medicare patients. CMS will check the data to ensure it is in the proper format.

A set of 10 quality measures has gone through years of extensive testing for validity and reliability. They have been chosen because they are related to three serious medical conditions that are common among people with Medicare and that result in hospitalization, which are heart attack (acute myocardial infarction), heart failure, and pneumonia. They are endorsed by the National Quality Forum, a voluntary standard-setting, consensus-building organization representing providers, consumers, purchasers and researchers.

"Valid, reliable, comparable and salient quality measures provide a potent stimulus for clinicians and providers to improve the quality of care they provide," Smith said. "Of equal importance is public reporting to ensure that consumers have the information they need so they can make more informed decisions based on quality of care."

Quality Improvement Organizations (QIOs), independent organizations working under contract to CMS, will provide technical assistance to hospitals in their data abstraction and submission and with quality improvement activities. Hospitals are urged to contact their local QIO today for this technical assistance.

"CMS’s QIOs stand ready to assist hospitals to successfully report quality measures and improve the quality of care they deliver," said Smith. "The QIO program has been critical to the success of our Nursing Home and Home Health Quality Initiatives, and as our grass roots mechanism for improving the quality of patient care, they will also play an important role in the success of the Hospital Quality Initiative."

Since October 2003, CMS has reported data on a set of 10 hospital quality measures submitted voluntarily by hospitals on The same measures will be used in implementing MMA.

The 10 measures in three disease areas are:

  • Heart attack (Acute Myocardial Infarction)
    Was aspirin given to the patient when upon arrival at the hospital?
    Was aspirin prescribed when the patient was discharged?
    Was a beta-blocker given to the patient upon arrival at the hospital?
    Was a beta-blocker prescribed when the patient was discharged?
    Was an ACE Inhibitor given for the patient with heart failure?
  • Heart failure
    Did the patient get an assessment of his or her heart function?
    Was an ACE Inhibitor given to the patient?
  • Pneumonia
    Was an antibiotic given to the patient in a timely way?
    Had a patient received a Pneumococcal vaccination?
    Was the patient's oxygen level assessed?

"Aligning payment with superior quality is a major focus of this agency, and today’s guidance is one important piece of that," said Smith. "All of our efforts are taking us to one end: high quality care for people with Medicare that is accelerated by public reporting of a robust set of quality measures and supported by technical assistance from our Quality Improvement Organizations."

Fact Sheets with further detail for hospitals will be available at