The CMS will test whether paying skilled-nursing facilities more will help reduce avoidable hospital admissions among their long-term-care residents. Industry stakeholders say the move acknowledges the role of post-acute-care facilities in improving quality of care, a role integral to the upcoming bundled payment model.
The new skilled-nursing payment policy would affect individuals who are in either Medicare or Medicaid, or eligible for both programs.
“This initiative has the potential to improve the care for the most frail, most vulnerable Medicare-Medicaid enrollees (who are) long-stay residents of nursing facilities,” Tim Engelhardt, Director of the Medicare-Medicaid Coordination Office said in a statement. “Smarter spending can improve the quality of on-site care in nursing facilities, and the assessment and management of conditions that too often now lead to unnecessary and costly hospitalizations.”
Participating skilled-nursing facilities will be paid to provide additional treatment for common medical conditions that often lead to avoidable hospitalizations. The CMS will focus on six medical conditions that together, are linked to about 80% of potentially avoidable admissions: pneumonia, dehydration, congestive heart failure, urinary tract infections, skin ulcers and asthma.
Medicare currently pays physicians less for a comprehensive assessment at a skilled-nursing facility than for the same assessment at a hospital. The new model would equalize provider payments between sites of care. Removing potential barriers to effective treatment within a facility can improve residents' care, and mitigate the need for disruptive and costly hospitalizations, the CMS said.
Industry stakeholders were thrilled with the news. “This initiative seems to recognize, better than the ongoing bundling demonstrations, the extremely valuable role post-acute-care providers can play in preventing costly, unnecessary hospitalizations among the most vulnerable of Medicare and Medicaid beneficiaries,” said James Michel, senior director of Medicare reimbursement and policy at the American Health Care Association, a not-for-profit federation of state health organizations.
The demonstration is not expected to adversely impact hospitals participating in the CMS' Comprehensive Care for Joint Replacement payment model. Starting April. 1, hospitals in 67 regions, including Los Angeles and New York City will be required to accept bundled payments covering all services for hip and knee replacement procedures for 90 days, beginning with hospital admission.
Participating hospitals will have to lower their costs or absorb their losses. That requirement will kick in after the first year of the five-year demonstration.
Since the nursing-home initiative will raise the cost of this type of care for some, it's likely those patients will be carved out from tracking efforts under the bundled-payment program, so that the CMS can adequately analyze both models, according to Dr. Kavita Patel, a senior fellow at the Brookings Institution and a former policy director for the Obama White House.
A CMS spokesman did not respond to a request for comment.
Approximately 250 long-term-care facilities will be selected to participate in the skilled-nursing-facility initiative, which will begin in fall 2016.
