Developing Post-Acute Networks for APM Reimbursement Success

About 85 percent of healthcare C-suite leaders expect to expand post-acute care partnerships over the next three years, especially as their organizations aim to maximize alternative payment model reimbursement, a recent Premier report found.

Under many alternative payment models, providers are financially accountable for the cost and quality of care even after discharge. Some quality measures used to determine value-based reimbursement assess care up to 30 days post-discharge and some bundled payment models keep providers accountable for 90 days of care.

“Given this new reality, providers must better understand trends after patients are discharged from the health system and better manage how and where they engage PAC [post-acute care] providers,” stated the report. “As our healthcare system pushes providers toward more population health, hospital leaders must optimize their use of PAC and establish partnerships to delivery highest quality, most cost-effective patient care.”

However, Premier found that creating a post-acute care network is a daunting task for many healthcare organizations. Approximately 95 percent of C-suite leaders stated that their hospitals and healthcare systems may face challenges with developing high-value post-acute care partnerships.

The report attributed post-acute care network hardships to a lack of performance data and high levels of cost and quality variation among post-acute providers.

“Historically, healthcare providers have not had the data to really see across the continuum of care with any degree of reliability,” Blair Childs, Premier Senior VP of Public Affairs, said in a teleconference. “Once they’ve been getting this information as a result of participating in accountable care organizations and some of the bundled payment programs, they’re seeing the variation within their communities in terms of the post-acute care network.”

For example, a 2014 study in The New England Journal of Medicine showed that top post-acute care providers had an average Medicare length-of-stay of less than 24 days, but low-performing providers had an average of more than 34 days.

The variation in length-of-stay equated to a $4,000 per admission difference.

Another MedPAC report from March also found that quality performance on discharge to community, new pressure sore development, and readmissions significantly varied from low- to top-performing providers.  For instance, the 25th percentile of skilled nursing facilities had a 7.8 percent rate for potentially avoidable readmissions during a stay. In contrast, the 75th percentile had a 13.6 percent rate.

Now that healthcare organizations can access quality and cost performance data, Premier developed five best practices for developing a high-value post-acute care network. The considerations include determining roles within the organization to spearhead the project, understanding performance through data, starting dialogues with post-acute providers, developing narrow preferred provider networks, and improving patient care together.

Healthcare organizations should start by identifying who within their organization will be responsible for post-acute engagement, the report stated.

“These network development processes take leadership. They take guidance,” Andy Edeburn, Principle of Population Health Advisory Services at Premier, said at the teleconference. ”Defining accountability in the organization from who is going to champion this to who is going to actually build it up, set it up and operate it, has become more and more urgent.”

The organization should clarify roles, duties, staffing, communication, and workflows that will be part of the healthcare system and preferred post-acute provider partnerships. It should also define accountabilities for communication, decision-making, and conflict resolution as the collaboration matures.

Understanding what post-acute care is needed in the network should be the next step for healthcare organizations, added the report.

“What organizations need to do is figure out what are their needs from a post-acute perspective,” said Edeburn. “Do we have enough nursing homes or skilled nursing facilities support in our market? Do we need more home health agencies support? What are our needs? What are our gaps?”

Healthcare organizations should also use available data, such as CMS compare websites, to evaluate local post-acute providers. Post-acute providers in the network should be able to serve the same patient populations as the healthcare organization with high quality, cost-effective care.

Once healthcare organizations develop a post-acute care network strategy, they should start dialogues with interested local post-acute care providers.

“Organizations need to consider the data they’ve learned, but they also need to evaluate in-person and via data requested from the post-acute providers about their capacity and their ability,” stated Edeburn. “A lot of organizations do that via surveys or requests for information from the post-acute providers. A lot of it is done via on-site visits.”

With interested post-acute providers, healthcare organizations should develop narrow networks with preferred institutions. The preferred providers should be willing to adopt accountable care measures and a culture of safety, quality, and patient centeredness as well as fit a top performer profile.

“In that environment, what organizations need to think about is identifying those top performers who are going to help address that need that was identified early on,” added Edeburn.

Post-acute networks should also be relatively small depending on what the healthcare organization’s needs are for post-acute care and how many preferred providers they can effectively control. Organizations should also consider a post-acute care provider’s capacity.

After networks are developed, healthcare organizations and post-acute providers need to collaborate to improve patient care across the care continuum. Areas of focus should include improving acute to post-acute transitions, enhancing post-acute care clinical capacity and practice, and using a framework for partnering and process improvement.

“Health systems and post-acute providers must recognize that significant changes need to take place within both entities in order to improve internal processes and establish best practices,” stated the report. “This means working closely toward a shared vision that makes care better and safer for patients, while also reducing clinical inefficiencies and creating new practices that foster collaboration and prevent siloes in care.”

Healthcare organizations can use these best practices to develop post-acute care networks, but Edeburn added that hospitals and healthcare systems should be aware of changing community needs and always be prepared to modify their networks.

He said, “What healthcare organizations need to do as part of this process is evolve their networks on an ongoing basis to really achieve performance improvement or performance accountability that everybody wants for successful post-acute relationships.”

Dig Deeper:

• Preparing the Healthcare Revenue Cycle for Value-Based Care

• Post-Acute Care Can Help Accountable Care Organizations Save