By Jordan Rau DECEMBER 3, 2018
The
federal government has taken a new step to reduce avoidable hospital
readmissions of nursing home patients by lowering a year’s worth of payments to
nearly 11,000 nursing homes. It gave bonuses to nearly 4,000 others.
These
financial incentives, determined by each home’s readmission rates,
significantly expand Medicare’s effort to pay medical providers based on the
quality of care instead of just the number or condition of their patients.
Until now, Medicare limited these kinds of incentives mostly to hospitals,
which have gotten used to facing financial repercussions if too many of their
patients are readmitted, suffer infections or other injuries, or die.
“To some nursing homes, it could mean a
significant amount of money,” said Thomas Martin, director of post-acute care
analytics at CarePort Health, which works for both hospitals and nursing homes.
“A lot are operating on very small margins.”
The new
Medicare program is altering a year’s worth of payments to 14,959 skilled
nursing facilities based on how often their residents ended up back in
hospitals within 30 days of leaving. Hospitalizations of nursing home
residents, while decreasing in recent years, remain a problem, with
nearly 11 percent of patients in
2016 being sent to hospitals for conditions that might have been averted with
better medical oversight.
These
bonuses and penalties are also intended to discourage nursing homes from
discharging patients too quickly — something that is financially tempting as
Medicare fully covers only the first 20 days of a stay and generally stops
paying anything after 100 days.
Over
this fiscal year, which began Oct. 1 and goes through the end of September 2019,
the best-performing homes will receive 1.6 percent more for each Medicare
patient than they would have otherwise. The worst-performing homes will lose
nearly 2 percent of each payment. The others will fall in between. (You can see
the scores for individual nursing facilities here.)
For-profit
nursing homes, which make up two-thirds of the nation’s facilities, face deeper
cuts on average than do nonprofit and government-owned homes, a Kaiser Health
News analysis of the data found.
In
Arkansas, Louisiana and Mississippi, 85 percent of homes will lose money, the
analysis found. More than half in Alaska, Hawaii and Washington state will get
bonuses.
Overall,
10,976 nursing homes will be penalized, 3,983 will get bonuses, and the
remainder will not experience any change in payment, the KHN analysis found.
Medicare
is lowering payments to 12 of the 15 nursing homes run by Otterbein SeniorLife,
an Ohio faith-based nonprofit. Pamela Richmond, Otterbein’s chief strategy
officer, said most of its readmissions occurred with patients after they went
home, not while they were in the facilities. Otterbein anticipates losing
$99,000 over the year.
“We’re
super disappointed,” Richmond said about the penalties. She said Otterbein is
starting to follow up with former patients or the home health agencies that
send nurses and aides to their houses to care for them. If there are signs of
trouble, Otterbein will try to arrange care or bring patients back to the
nursing home if necessary.
“This
really puts the emphasis on us to go out and coordinate better care after they
leave,” Richmond said.
Congress
created the Skilled Nursing Facility Value-Based Purchasing Program incentives
in the 2014 Protecting Access to Medicare Act. In assigning bonuses and
penalties, Medicare judged each facility’s performances in two ways: how its
hospitalization rates in calendar year 2017 compared with other facilities and
how much those rates changed from calendar year 2015.
Facilities
received scores of 0 to 100 for their performances and 0 to 90 for their
improvements, and the higher of the two scores was used to determine their
overall score. Facilities were then ranked highest to lowest.
Medicare
is not measuring readmission rates of patients who are insured through private
Medicare Advantage plans, even though in some regions the majority of Medicare
beneficiaries rely on those to afford their care.
Through
the incentives, Medicare will redistribute $316 million from poorer-performing
to better-performing nursing homes. Medicare expects it will keep another $211
million that it would have otherwise paid to nursing homes if the program did
not exist.
The new
payments augment other pressures nursing homes face from Medicare and state
Medicaid programs to lower readmissions to hospitals.
“Skilled
facilities have been working toward this and knew it was coming,” said Nicole
Fallon, vice president of health policy and integrated services at LeadingAge,
an association of nonprofit providers of aging services.
The
American Health Care Association, a trade group of nursing homes, said in a
statement that it had supported the program and was gratified to see that more
than a quarter of facilities received bonuses.
While
most researchers believe that readmissions can be reduced, some consumer
advocates fear that nursing homes will be reluctant to admit very infirm
residents or to re-hospitalize patients even when they need medical care.
“It may
end up causing great pain to residents who actually need to be hospitalized,”
said Patricia McGinnis, executive director of California Advocates for Nursing
Home Reform, which is based in San Francisco.
Fallon
said Medicare eventually may penalize homes that have done all they can to
prevent return trips to the hospital. But because of the program’s design by
Congress, Medicare still will need to punish large numbers of homes.
“There’s
always going to be winners and losers, even if you make good progress,” Fallon
said. “At what point have we achieved all we can achieve?”
Meanwhile,
Medicare is looking to expand financial incentives to other kinds of providers.
Since 2016, it has been testing quality bonuses and penalties for home health
agencies in nine states. Richmond, the nursing home executive, applauded that
kind of expansion.
‘There’s
a whole bunch of people in this chain” of institutions caring for patients at
different stages, she said, “and we all need to be working in a common direction.”
KHN
data editor Elizabeth Lucas contributed to this report.
KHN’s coverage related to aging and improving care of older
adults is supported in part by The John A.
Hartford Foundation.
Jordan
Rau: jrau@kff.org,
@JordanRau
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