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Nursing homes stressed as move to value-based reimbursement intensifies

In a new report, Stackpole Associates has commented on and summarized  data  that the nursing-home industry has been avoiding for several years.
Of particular interest to Cambridge Management Group is the effect on nursing homes of moving from volume to value, since CMG has been spending a lot of time in helping clients do that in recent years.
 Among Stackpole’s observations:

“Declining demand in long-term care markets is not a popular topic, but the inaugural SNF {skilled nursing facility} report from the National Investment Center for Seniors Housing & Care (NIC) clearly shows this trend. The occupancy rates in long-term care markets have been dropping, and in the SNF category, occupancy fell from just under 85% in October 2011 to 82.8% in December 2015, according to NIC. The decline in occupancy in this specific long-term care market would have been worse if owners and operators had not been removing capacity (taking beds off-line) from the system progressively over the same period of time. When both the number of beds is declining, and occupancy is decreasing, how can this be described as anything but a late mature, early declining market?”

“The biggest single factor in the decline in demand in the long-term care markets is the Demographic Dip or Birth Dearth. Demographics are like gravity; you can learn to work with it, but you can’t deny it.”

We at CMG take issue with part of Stackpole’s  remarks below. The implication  that nursing homes will only be available for rich people is not correct.    Strong skilled nursing facilities are emerging in the Medicaid sector.

“Compounding the challenges of declining long-term care markets, are the initiatives by CMS and … managed care organizations to reduce utilization, and ‘squeeze out’ margin in the sector. The transition from volume-based payments to value-based payments through such mechanisms as Accountable Care Organizations (ACOs) and Bundled Payment for Care Improvement (BPCI) are laudable and needed, but these will have devastating effects on the sector. The shift from volume to value will benefit the strongest (i.e., SNFs with the best quality payor mix) and disproportionately hurt SNFs serving the most vulnerable populations in our society. As intermediaries and value-based payment initiatives reduce utilization, and margin from the sector, the weakest will be forced to either close or merge with other, bigger and stronger systems.”

 


A Swedish model for coordinating care of elderly people with complex needs

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Images of Jönköping County.

A case study published by the Commonwealth Fund discusses Sweden’s “Esther Model” of caring for elderly patients with complex needs.

The authors note, by way of introduction:

“Elderly patients with complex care needs may receive services from multiple specialists, as well as primary care physicians. In addition, they may visit emergency departments, have frequent hospitalizations and post-hospital rehabilitations, and receive long-term care services at their home or in nursing facilities. Jönköping County, in Sweden ,focused on improving care coordination and the experiences of elderly patients through the ‘Esther Model.”‘

“The Esther model began in the late 1990s, originally as a three-year project. Founder Mats Bojestig, then head of the medical department of Höglandet Hospital, in Nässjö, used the negative experiences of an elderly patient, known as ‘Esther,’ as inspiration.”

As for its value as an example for America, the researchers write:

“The Esther Model developed as a voluntary collaborative effort in a small region that allowed for face-to-face meetings among all care-providing organizations. It is difficult to envision the model exported in its entirety to more complex settings. Nevertheless, many of its strategies are applicable well beyond a subregion of a Swedish county. In fact, cousins of the Esther approach are now operating elsewhere in Sweden, and replication is occurring in locations in other countries as well.

“The problems that the Esther model addresses certainly exist in the United States, where the care chain involves multiple provider organizations and payers with conflicting financial incentives. Establishing Esther or a similar model in the U.S. might be most feasible in places where single organizations are responsible for multiple levels of care or where hospitals serve reasonably well-defined geographic regions. Mechanisms that consolidate economic and medical responsibilities for patients, like accountable care organizations, would likely facilitate adoption of the model, as would financial incentives that deter practices that are harmful to patients and wasteful of resources, like unnecessary hospital readmissions. Adoption also might be aided by continuing to survey patients and caregivers about the care they are receiving.”

To read the (fascinating) study, please hit this link.


CMS to let providers set pace to move to value-based payments

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The tortoise and the hare.

The Centers for Medicare & Medicaid Services has  announced that it   will let providers choose the level and speed at which they comply with the new payment-reform model  that emphasizes the medical value/outcomes of patient care over the volume of procedures. In the current, predominately “fee for service” system, the more procedures that providers order, the more they get paid. That is one reason that America’s physicians are by far the highest paid in the world.

Healthcare industry stakeholders have put the CMS under intense pressure  to ease implementation of the Medicare Access and CHIP Reauthorization Act, which is set to start Jan. 1, 2017. Two months ago, CMS Acting Administrator Andy Slavitt said the agency was considering delaying the start date.

And so eligible physicians and other clinicians next year will be given four options to comply with  such new payment schemes such as the Merit-based Incentive Payment System (MIPS) or an alternative payment model (APM), such as Accountable Care Organizations.

Modern Healthcare reported that under MIPS, physician payments “will be based on a compilation of quality measures and the use of electronic health records. About 90 percent of physicians are expected to pursue MIPS because a qualifying APM requires a hefty amount of risk.

“In the first option offered Sept. 8, any data reported will allow providers to avoid a negative payment adjustment. The goal is to ease providers into broader participation in the following two years, ” the publication reported.

The second option lets providers  submit data for a reduced number of days. “This means their first performance period could begin later than Jan. 1 and that practice could still qualify for a small payment if it submits data on how the practice is using technology and how it’s improving,” Modern Healthcare reported.

The third option is for practices that are ready to go in 2017.

To read the Modern Healthcare story, please hit this link.

 

 


Study: Non-ACO hospitals sometimes do better than ACO ones

 

A  study in the American Journal of Managed Care indicates that hospitals that participate in an Accountable Care Organization don’t necessarily  perform better that non-ACO peers in all Medicare value-based programs.

Here are three key study findings, as summarized by Becker’s Hospital Review.

1. “Between 2013 and 2016, hospitals in ACOs performed better than non-ACO hospitals in CMS’s Hospital Readmissions Reduction Program by a factor of 0.72.

2. ”During the same period, non-ACO hospitals outperformed hospital ACOs in Hospital Value-Based Purchasing and Hospital-Acquired Condition Reduction programs by a statistical significance factor of 0.001. When researchers adjusted for specific hospital attributes, such as number of beds, ownership and teaching status, non-ACO hospitals fared better by a factor of 0.62 for the HVBP program and 0.28 for the HACR program.

3. ”’Despite similar goals, hospital participation in an ACO is not correlated with improved performance in all Medicare VBP programs,’ the study concluded.”

To read the American Journal of Managed Care study, please hit this link. To read the Becker’s summary, please this link.


Burwell calls Fort Dodge, Iowa, community-health model

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Downtown Fort Dodge.

Sylvia Burwell, the U.S. secretary of health and human services, has hailed Fort Dodge, Iowa (pop. 25,000), as a model for improving community health.

That’s in large part because Fort Dodge’s branch of the Des Moines, Iowa-based UnityPoint Health System also hosts one of the first Accountable Care Organizations in the country. The ACO work that healthcare providers have done in Fort Dodge makes it one of the nation’s best examples of how to improve health while curbing costs.

The Des Moines Register reports that Ms. Burwell visited Fort Dodge on July 14 to hear local physicians, nurses and patients about successes in healthcare. “We know that folks are depending on us to make more progress on affordability and on quality. I’m here to visit today one of the great models of people accelerating the change that the rest of the nation needs to do,” the paper reported.

The Register said  that  Fort Dodge’s ACO is particularly  unusual among other early ones because it has  at least broken even financially. Ms. Burwell cited the  collaboration among healthcare providers and a range of community agencies for the success.

For the full article from The Register, please hit this link.


‘From clinic to community’

 

A JAMA report, “Population Health Case Reports: From Clinic to Community,” describes collaborations between healthcare organizations and public-health departments and community organizations. In an era characterized by much stronger efforts to coordinate healthcare, it’s well worth reading.

The authors write:

“Like a winning lottery ticket, the productive alignment of medical services with public health has been long desired but infrequently experienced. Recently, however, the evolution of healthcare payment may be tilting the odds in favor of initiatives that cross from the clinic to the community. As Accountable Care Organizations, medical homes and hospitals under global budgets begin to accept financial risk for the health of large populations of patients, there is new momentum for the development of collaborations that aim to reduce preventable illness.”

To read the JAMA report, please hit this link.


AMA moves further to address physician-burnout issue

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MedPage Today reports that the “American Medical Association wants physician work-life balance added to provider-experience measures for evaluating how well alternative payment models function” address what is seen as the growing  incidence of physician burnout under the stress of ever more complicated work, including vast quantities of red tape and record-keeping.
The new AMA policy, approved following the annual meeting of its House of Delegates, also changed  its support of the “Triple Aim” to  support of the “Quadruple Aim”. As originally conceived in the development of healthcare reform in recent years, the Triple Aim seeks to improve patient experience and the health of populations and to cut per-capita costs.

The AMA will ask the Centers for Medicare & Medicaid Services to use the Quadruple Aim when evaluating Accountable Care Organizations and other practice


ACO benchmarking issues may be fixed; next problem?

 

Bob Herman, writing in Modern Healthcare, reports that while CMS may have fixed its benchmarking issues with Accountable Care Organizations, that might be inadequate.

He writes: “{M}any have raised concerns that the CMS still is not doing enough to ease providers into riskier ACO models, which is paramount for Medicare’s new physician-payment system.

“The elephant in the room is not the benchmarking rule,” Clif Gaus, CEO of the National Association of ACOs, a trade group run by hospitals and physician groups, told Mr. Herman. “It is: What is CMS going to do to improve the business model for the one-sided ACOs and provide a lower-risk track for the two-sided programs?”

Hit this link to read Mr. Herman’s article.


CMS releases stronger incentives to join ACOs

CMS has released final regulatory revisions  to strengthen incentives for Accountable Care Organizations in the Medicare Shared Savings Program.

CMS Acting Administrator Andy Slavitt said the changes  will “encourage more physicians to improve patient care by joining ACOs, while also refining how the program measures success, so that current participants are better rewarded for quality.”

Mr. Slavitt said the changes will also help physicians prepare for the new Quality Payment Program That program will hold providers to unprecedented accountability not just for reporting, but also, among large physician groups, for performance on a broad range of behaviors.

Here, according to Becker’s Hospital Review, are five takeaways from the MSSP ACO final rule.

1. “CMS modified the process for resetting benchmarks used to determine ACO performance.”

2. “CMS removed the adjustment that explicitly accounts for savings generated under an ACO’s prior agreement period.”

3. “The rule includes a phased-in approach to implementation.”

4. “CMS finalized an additional option for ACOs participating under Track 1 to apply to renew for a second agreement period under a two-sided model.”

5. “The rule establishes timeframes and criteria for ACOs to appeal CMS’ calculation of bonuses and penalties.”

 


IRS ruling on ACOs not a disaster

 

Paul Keckley, the well-known healthcare analyst, tells providers and others not to unduly worry about the  Internal Revenue Service’s affirming that for purposes of coordinating care for Medicare enrollees,  Accountable Care Organizations do not threaten an institution’s tax-exempt status, but if serving commercially insured populations, there may be a problem.

But Mr. Keckley writes: “Here’s my take: ACOs are here to stay.

“Clinically integrated networks of providers that assume risks for quality and costs are the future, whether serving Medicare, Medicaid or commercial populations. Twenty-eight million patients are served through an accountable care model; their numbers will swell as insurers and employers drive attention to the model.

“No doubt, CMS will continue to alter its measures of quality; the 34 measures in use this year include four that are new.”

{But} “While this private letter ruling is likely to cause some to push the pause button on their ACO activities, it will not be a permanent slowdown. In fact, a number of hanging chads about ACOs need to be addressed — how enrollee attribution is calculated and risks scored, how savings can be shared including the possibility an enrollee might share along with providers and business partners, how quality is measured and so on.

“For tax-exempt hospitals, proceed with caution: A focus on Medicare and Medicaid ACO enrollment seems safe, while parallel efforts targeting employers and insurers should be carefully monitored but not suspended.

“In the end, the reality is that the IRS curveball will not lead to a strikeout for ACOs. Like so much of what’s done in the name of innovation in healthcare, the rules are constantly changing, or even unknown, but the goal of winning the game is clear.”

 

 


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