# A Patient Perspective on Value: Medicare's Hospital Value-based Purchasing Program

> **NIH AHRQ R03** · UNIVERSITY OF CALIFORNIA AT DAVIS · 2020 · $99,437

## Abstract

PROJECT SUMMARY/ABSTRACT
The United States spends more than any country on health care and costs are rising at an unsustainable rate.
This is an issue for patient, providers, and payers, including the Centers for Medicare and Medicaid Services
(CMS) which provides care for 90 million Americans at a cost of over $600 billion annually. To address escalating
costs, the CMS has implemented seven value-based payment programs which reward providers who deliver
high-quality care and penalize those that do not. This includes the CMS’ Hospital Value-Based Purchasing (VBP)
Program, which in 2019 reallocated nearly 1.9 billion to hospitals based on their performance on four domains:
(1) outcomes (i.e. clinical care); (2) patient experience (i.e. person and community engagement); (3) safety; and
(4) efficiency and cost reduction. However, one issue with the CMS’ Hospital VBP Program is that it was not
developed with patients, and consequently, it is provider-centered rather than patient-centered. For example, within
the CMS’ Hospital VBP Program, each of the four domains used to evaluate performance are weighted equally
(25% each). This means that a hospitals performance on outcomes is considered equally important as its’
performance on patient experience or safety. This reflects the perspective of the CMS; however, evidence has
shown that patients may have very different views than providers or payers on what constitutes value. By failing
to consider the perspective of patients, the CMS’ Hospital VBP Program may be rewarding hospitals that are
providing care that is not valued by patients and penalizing those that do. The objective of this proposal is to
determine how considering the patient perspective in the design of the CMS’ Hospital VBP Program would
impact on financial incentive payments to providers. This proposal seeks to (Aim 1) estimate patient-centric
‘value weights’ for the four domains in the CMS’ Hospital VBP Program. The weights will be estimated by
administering a survey containing a discrete choice experiment in a nationally representative sample of
Medicare patients. The results will then be used to (Aim 2) estimate the impact of using patient-centric weights
on hospital reimbursement in fiscal year 2019. This will be accomplished by using publically available data on
the performance of 2,786 hospitals enrolled in the CMS’ Hospital VBP Program.

## Key facts

- **NIH application ID:** 10107691
- **Project number:** 1R03HS027853-01
- **Recipient organization:** UNIVERSITY OF CALIFORNIA AT DAVIS
- **Principal Investigator:** Jeffrey Hoch
- **Activity code:** R03 (R01, R21, SBIR, etc.)
- **Funding institute:** AHRQ
- **Fiscal year:** 2020
- **Award amount:** $99,437
- **Award type:** 1
- **Project period:** 2020-09-10 → 2022-08-31

## Primary source

NIH RePORTER: https://reporter.nih.gov/project-details/10107691

## Citation

> US National Institutes of Health, RePORTER application 10107691, A Patient Perspective on Value: Medicare's Hospital Value-based Purchasing Program (1R03HS027853-01). Retrieved via AI Analytics 2026-05-28 from https://api.ai-analytics.org/grant/nih/10107691. Licensed CC0.

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