Post-acute referral patterns for hospitals and implications for bundled payment initiatives

Christopher Lau,Abby Alpert,Peter Huckfeldt,Peter Hussey,David Auerbach,Hangsheng Liu,Neeraj Sood,Ateev Mehrotra

doi:10.1016/j.hjdsi.2014.05.004

Abstract

BackgroundUnder new bundled payment models, hospitals are financially responsible for post-acute care delivered by providers such as skilled nursing facilities (SNFs) and home health agencies (HHAs). The hope is that hospitals will use post-acute care more prudently and better coordinate care with post-acute providers. However, little is known about existing patterns in hospitals׳ referrals to post-acute providers. MethodsPost-acute provider referrals were identified using SNF and HHA claims within 14 days following hospital discharge. Hospital post-acute care network size and concentration were estimated across hospital types and regions. The 2008 Medicare Provider Analysis and Review claims for acute hospitals and SNFs, and the 100% HHA Standard Analytic Files were used. ResultsThe mean post-acute care network size for U.S. hospitals included 57.9 providers with 37.5 SNFs and 23.4 HHAs. The majority of these providers (65.7% of SNFs, 60.9% of HHAs) accounted for 1 percent or less of a hospital׳s referrals and classified as “low-volume”. Other post-acute providers we classified as routine. The mean network size for routine providers was greater for larger hospitals, teaching hospitals and in regions with higher per capita post-acute care spending. ConclusionsThe average hospital works with over 50 different post-acute providers. Moreover, the size of post-acute care networks varies considerably geographically and by hospital characteristics. These results provide context on the complex task hospitals will face in coordinating care with post-acute providers and cutting costs under new bundled payment models.

Highlights

The Centers for Medicare and Medicaid Services (CMS) is transitioning away from fee-for-service reimbursement systems towards alternative payment models like bundled payments.[1]
Referrals to low-volume providers comprised a modest fraction of all post-acute care referrals (11.4% of skilled nursing facilities (SNFs) referrals and 9.5% of health agencies (HHAs) referrals)
The percent of SNF and HHA referrals that were made to the top five providers in a hospital's referral network varied across a large range

Summary

Introduction

The Centers for Medicare and Medicaid Services (CMS) is transitioning away from fee-for-service reimbursement systems towards alternative payment models like bundled payments.[1]. Research has demonstrated that post-acute provider spending drives much of the spending variation across hospitals and geographic regions and constitutes a major contributor to the recent growth in Medicare spending.[2,3,4,5] Under new bundled payment models, hospitals bear financial responsibility for the care provided by post-acute providers.[6] The hope is that hospitals will be more prudent in their use of postacute care, improve care coordination with post-acute providers, and encourage its patients to receive care at low-cost and highquality post-acute providers. Under new bundled payment models, hospitals are financially responsible for post-acute care delivered by providers such as skilled nursing facilities (SNFs) and home health agencies (HHAs). The size of post-acute care networks varies considerably geographically and by hospital characteristics. These results provide context on the complex task hospitals will face in coordinating care with post-acute providers and cutting costs under new bundled payment models

Methods

Results

Conclusion