Originally published in Report On Medicare Compliance - Volume 21, Number 6 • February 13, 2012 - Atlantic Information Services, Inc. - February 2012.

With Medicare reimbursement increasingly tied to quality of care, compliance monitoring will have to push further into patient outcomes and data integrity. In a few years, hospitals that drop the ball on quality-improvement initiatives — which include value-based purchasing and the readmission reduction program — could lose up to 6% of their Medicare revenue. Some of the penalties that kick in down the road are based on past as well as current performance, another reason for hospitals to focus on quality-improvement initiatives now.

“Payments will now be based more on quality, and therefore quality failures are more likely to lead to false claims and payment denials,” said Chicago attorney Janice Anderson, with Polsinelli Shughart. “It’s really important that compliance officers understand the link between quality and compliance and restructure their programs so that quality information is looked at through the lens of compliance.” For example, hospitals will have to improve discharge planning, which means better documentation.