• Lana Bamiro

$50K Bonus for Quality Care


The Affordable Care Act (ACA), a.k.a ObamaCare is known mostly for providing health insurance to all Americans, eliminating the pre-existing conditions clause health insurance companies held on to, and increasing the gross national GDP (the right wing’s favorite complain of the law). Not much is publically discussed about some of the incentive programs and penalties to hospitals for improving the quality of care to their patients. What typically comes to mind when discussing quality of care in hospitals to enthusiasts of hospital administration is The Joint Commission, a not-for-profit organization that accredits and certifies almost 20,000 health care organizations and programs in America. However, part of the ACA creates an incentive/penalty program for Medicare to pay hospitals based on quality of care to their patients.

The program started in October 2012 with Medicare withholding 1% of a hospital’s bill to Medicare; that 1% could then be earned after a year worth of evaluation showing good quality care to Medicare patients; ACA created for an increase to 2% withholding by 2016. This value-based purchasing program generates about $850 million from withholding 1% and have reimbursed hospitals with the highest quality at the end of the year (an estimate of about $50,000 according to an article in the Health Affairs journal by 2 professors that modeled the program), while hospitals at the bottom of the totem pole lost their 1% (estimated at about $100,000).

The question scholars have asked is whether or not the monetary value is worth the program and whether it generates a big enough incentive for hospitals to pursue Medicare’s quality standards. One could argue that the pride and accolades that come with being at the top in quality per Medicare’s program could be an added incentive to pursue this endeavor, but The Joint Commission’s accreditation has become the gold standard for quality care that other measures are rarely ever assessed or given enough attention to grow.


The hospital industry is a big industry within a larger industry in itself, health care. I believe it’s a shame that we hold other industries such as the auto industry or banking industry to relatively high standards in comparison to the hospital and health care industry in general when health is paramount and without good health all other fields of life are pointless. For instance, if a person’s banker made an error on his/her bank account to the tune of $200,000, the patron would likely raise hell! But if this were the case with a procedure that costs about the same amount a patient may not be as aggressive as they would have been with their banker to their physician or the hospital. I think “we the people” play a big role in the flaws the health care industry and hospital industry shows often.

The saying “to err is human” is understandable but we rarely permit that excuse with other industries. For us to get the very best in health care we must not settle and not accept 80% infection control or 90% medication error free procedures, we must insist on 100% all the time. The incentive program Medicare presented in 2012 was a great start, but I believe 1% is so negligent that some hospitals have not pursued it actively; maybe if Medicare withheld 20% then would we (practitioners and hospitals) push for 100% of care all the time!

Best wishes,


#Health #Life

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As the tagline above says, I am an author, a teacher and a public speaker.


I am also a goal oriented professional healthcare administrator/ practitioner with a decade of clinical, management and leadership experience in healthcare practice and administration.



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