Value-based Reimbursement System Research Articles

Ownership Change and Care Quality: Lessons From Minnesota's Experience With Value-Based Purchasing.

Background and ObjectivesMinnesota’s implementation of a new nursing home value-based reimbursement (VBR) system in 2016 presented an opportunity to compare the response of nursing homes (NHs) to financial incentives to improve their quality and efficiency. The state substantially increased reimbursement for care-related costs and tied this rate increase to a composite quality score. Coinciding with rate increases of the new VBR system was an increase in ownership changes, with new owners being primarily for-profit entities from outside of Minnesota, including several private equity firms. Our objective was to examine NHs that underwent a change in ownership to determine their cost and quality response to the change.Research Design and MethodsOur sample consists of 342 Minnesota NHs that submitted Medicaid cost reports each year from 2013 to 2019. A time differential two-way fixed-effects difference-in-difference model is used to assess changes in quality metrics by comparing measures in years prior to and years following the sale for NHs that changed ownership versus NHs with consistent ownership. Nursing home characteristics, revenue, and spending patterns are examined to understand differences in performance.ResultsThose NHs with ownership change experienced a decline in quality scores with notable changes to expenditure patterns. They performed worse on Minnesota Department of Health inspection scores and had nonsignificant declines in measures of quality of life and clinical care. They had declining staff dental and medical benefits and occupancy rates, greater revenue growth from Medicare Part B, and larger increases in administrative management fees.Discussion and ImplicationsMinnesota like many other states has given wide latitude for nursing home ownership changes, without specific oversight for the quality of care and expenditure patterns of new owners. Recommendations include strict guidelines for the transparency of ownership structures, quality performance targets, rigorous financial auditing, and enhanced regulatory oversight.

Evaluation of Minnesota’s Long-Stay Nursing Home Quality Indicators

Older adults with bipolar disorder are at increased risk of developing dementia. The literature suggests lithium treatment may reduce the incidence of dementia. This study sought to inform clinical practice in the Veterans Affairs (VA) health system by estimating the effect of past year lithium receipt on dementia incidence among Veterans with bipolar disorder. Divalproex receipt was used as a comparison. Using VA medical records, 121,094 Veterans aged 50 and older with a diagnosis of bipolar disorder but no dementia diagnosis were identified in fiscal years 2005-2019. Follow-up continued until dementia diagnosis, 36 months from the index date, death, or the end of fiscal year 2020, whichever came first. 4347 (3.6%) were diagnosed with dementia during follow-up. Time-varying indicators of receipt of lithium and divalproex in the prior 365 days were calculated for each day, categorized as 301-365, 61-300, 1-60, or 0 days of receipt. Unadjusted Cox proportional hazards regression analyses indicated reduced dementia incidence with 301-365 (HR=0.86, 95% Confidence Interval [95%CI] 0.75-0.99) and 61-300 (HR=0.75, 95%CI 0.65-0.87) days of lithium receipt, compared to 0 days. For divalproex, 301-365 (HR=1.34, 95%CI 1.23-1.47) and 61-300 (HR=1.13, 95%CI 1.03-1.23) days of receipt were each associated with increased dementia incidence. Lithium effects were not statistically significant after adjusting for age, sex, race, ethnicity, medical comorbidities, and antidepressant, antipsychotic, and anxiolytic medication receipt. Divalproex effects remained statistically significant. Past year divalproex, but not lithium, receipt was significantly associated with dementia incidence among VA patients with bipolar disorder when adjusting for demographics and medical comorbidities.

Understanding Nursing Home Responses to Minnesota’s New Value Based Reimbursement System

Even though Value Based Reimbursement (VBR) systems for nursing homes (NH) continue to expand, we have little understanding of how NH respond to VBR. In 2016, Minnesota passed VBR legislation for NHs that increased care-related funding and tied increases to a facility’s composite quality score. While care-related expenditures increased with VBR, the incentive for quality did not work as intended. We investigated the differential responses of facilities in their care-related expenditures and quality scores. Data were derived from cost reports and quality measures for the years 2013-2017 from 300 free-standing Minnesota NHs. Latent Class Growth Analysis was used to cluster facilities by their joint care-related cost and quality score trajectories over the period. Three interpretable trajectory clusters emerged: medium-to-high cost and medium-to-high quality (n=172), low cost and medium-to-high quality (n=54), and low cost and low quality (n=74), all during the pre-VBR period. In all three clusters cost rose significantly with VBR, but only in the low cost and low quality cluster did quality also rise significantly. The quality improving cluster had the highest percentage of government-owned and rural facilities as well as the largest annual increase in care related spending. The medium-to-high cost and medium-to-high quality cluster had the highest concentration of urban facilities (Twin City Metro Area) and were the most likely to be non-profit and chain owned. Although the new VBR system appeared effective in achieving its goals for a subset of facilities with lowest cost and quality, the majority of facilities increased care-related costs without improved quality.

Discharge to the skilled nursing facility: patient risk factors and perioperative outcomes after total knee arthroplasty.

Patients receiving a total knee arthroplasty (TKA) who fail to meet inpatient criteria for outpatient physical therapy or an acute rehabilitation facility are increasingly being discharged to skilled nursing facilities (SNFs). However, in some facilities, postoperative care and therapy may be suboptimal. In order to recognize the circumstances predisposing patients to a SNF discharge and quantify perioperative risks, we used a nationwide TKA database to compare those who were and were not discharged to SNFs with respect to: (I) patient and hospital characteristics; (II) comorbidities; (III) lengths of stay (LOS); and (IV) inpatient complications. The National Inpatient Sample database was queried for all individuals who received primary TKA (ICD-9-CM 81.54) between January 1st, 2009 and December 31st, 2013, yielding a total of 3,218,419 patients. Discharge disposition was readily identifiable, and the SNF patients numbered 403,575 (12.5%) vs. 2,814,574 discharged to home or a non-SNF setting (87.5%). A multi-level logistic regression analysis was conducted using patient and hospital specific factors as predictor variables in order to see if differences existed between the two cohorts. A two-tailed P value was set as the threshold for statistical significance. Patients discharged to SNFs post-TKA were older (mean, 72 vs. 65 years, P<0.001), more often female [odds ratio (OR) 1.74, P<0.001], black (OR 1.246, P<0.001), from the South (OR 1.856, P<0.001), and had various comorbidities including: preexisting psychoses (OR 1.703, P<0.001), history of drug abuse (OR 1.682, P<0.001), neurological disorders (OR 1.359, P<0.001), and depression (OR 1.334, P<0.001). The mean LOS for TKA patients discharged to SNFs was 17% longer (P<0.001). Patients discharged to SNFs were more likely to endure inpatient medical complications (OR 1.3, P<0.001), specifically pulmonary congestion or edema. Patients discharged to SNF had specific demographic characteristics and risk factors, increased LOS, more frequent inpatient medical complications, and greater hospital costs. Knowledge of these risk factors may be critical from the perspective of the new value-based reimbursement system for orthopaedic surgeon to intervene early and appropriately select the patients likely and capable of completing the rigorous postoperative TKA rehabilitation.

Association Between Estimated Mortality Risk and Measured Quality of Care in Older Adults

Quality measures based on processes of care (e.g., breast cancer screening) are frequently used to compare performance of providers and healthcare organizations in a value-based reimbursement system, but using these measures to make performance comparisons could penalize clinicians caring for older adults with multiple comorbidities. These clinicians may more frequently withhold recommended care based on limited prognosis, patient preference, or potential adverse effects and, as a result, may incur financial penalties because of poor measured performance. Alternatively, they may need to perform additional administrative work to exclude patients from quality measurement. To examine the potential performance handicap associated with caring for complex populations, we cross-sectionally examined the association between broad outpatient processes of care and 5-year mortality risk in a nationally representative older adult sample (≥ 65) from the 2002 to 2015 Medical Expenditure Panel Survey (n=26,006). In adjusted analyses, performance score based on process-of-care measures was significantly worse in the high-risk group (5-year mortality risk ≥50; adjusted performance score 67.4%; adjusted absolute difference 6.7%, 95% confidence interval (CI)=5.3-8.1%, p<.001) and in the intermediate-risk group (5-year mortality risk 25-49%; adjusted performance score 71.7%; adjusted absolute difference 2.4%, 95% CI=1.7-3.1%, p<.001) than in the low-risk group (5-year mortality risk <25%); adjusted performance score 74.1% following <25%. The trend was overall constant across types of care processes and was more prominent in the younger age brackets of our sample. These results suggest that use of process-of-care measures can lead to disproportionate burden for clinicians and organizations primarily taking care of complex populations.

Cost effectiveness of prostate cancer radiotherapy.

The use of radiotherapy in the treatment of prostate cancer has evolved from treatments utilizing large fields with hand placed blocks to radiotherapy treatments given with a linear accelerator moving around the patient on a robotic arm. These technologic developments have allowed radiation dose escalations resulting in improvements in disease and patient reported outcomes with longer biochemical disease-free survival (DFS) as well as improved quality of life. Increased costs have accompanied these technologic improvements with some private payers questioning the increased cost of the newer treatments and in some instances refusing to pay for some treatment modalities such as intensity-modulated radiotherapy (IMRT) or proton beam therapy (PBT). Cost-effectiveness analysis have been used in an attempt to illustrate these new treatments were cost-effective when compared to the older treatments. Cost-effectiveness analyses will need to be adapted in the current health care environment to provide an assessment of value as many payers, including medicare, move to a value-based reimbursement system.

The Merit-based Incentive Payment System (MIPS): A Primer for Otolaryngologists.

Following passage of the 2015 Medicare Access and CHIP Reauthorization Act, most clinicians caring for Medicare Part B patients were required to participate in a new value-based reimbursement system known as the Merit-based Incentive Payment System (MIPS) beginning in 2017. The MIPS adjusts payment rates to providers based on a composite score of performance across 4 categories: quality, advancing care information, clinical practice improvement activities, and resource use. However, factors such as practice size, setting, informational capabilities, and patient population may pose challenges as otolaryngologists endeavor to adapt to this broad-reaching payment reform. Given potential barriers to adoption, otolaryngologists should be aware of several important initiatives to help optimize their performance, including advocacy efforts by the American Academy of Otolaryngology-Head and Neck Surgery, the development of otolaryngology-specific MIPS quality measures, and the launch of a Centers for Medicare & Medicaid Services-qualified otolaryngology clinical data registry to facilitate reporting.

The Effect of Payer Type, Disposition, and Day of Surgery on Resource Consumption following Hip Fracture Care

AbstractAs we shift from a fee-for-service to value-based reimbursement system, it is critical that orthopaedic surgeons assess all characteristics of the patient prior to surgical intervention. The purpose of this study was to evaluate the relationship of payer type and disposition on direct and indirect measures of resource consumption (length-of-stay [LOS], hospital cost, and 30-day readmission). Patients equal to or more than 55 years of age with radiographic evidence of hip fracture necessitating surgical intervention were included. Initially, baseline characteristics, including age, body mass index (BMI), American Society of Anesthesiologist (ASA) score, fracture type, and instrumentation, were reported by payer type (private versus Medicare) and disposition (skilled nursing facility [SNF], home, and home health). In the second phase, the independent effects of payer type and disposition on resource consumption were evaluated. Lastly, the impact of payer type and day of admission on disposition were assessed. A total of 478 patients met the inclusion criteria. Evaluation of baseline characteristics demonstrated that age and ASA scores were significantly higher within the Medicare and SNF cohorts, when compared with private payers and home/home health, respectively. Medicare as a payer type resulted in an increased LOS (5.6 versus 4.5 days) and greater hospital cost (12.1%) than private payers. Moreover, payer type was not predictive of 30-day readmission. Disposition following operative fixation resulted in an average LOS of 5.8, 4.4, and 4 days for patients discharged to SNF, home, and home health, respectively. No significant difference in hospital stay was noted between home and home health patients. Compared with patients discharged home, in-hospital cost was 33.9 and 12.3% greater for the SNF and home heath cohorts, respectively. Finally, 21.6% of patients discharged to a SNF were readmitted within 30 days. Our results indicate Medicare patients and those discharged to a SNF are more likely to have longer LOS and incur greater costs. Additionally, 30-day readmission is significantly higher in patients discharged to SNF. Thus, patients with hip fracture should be rigorously optimized within the preoperative setting to enhance clinical outcomes. Moreover, additional resources should be allocated to the higher risk patients.

Aligning the flow cytometric evaluation with the diagnostic need: an evidence-based approach

AimsElimination of non-value added testing without compromising high-quality clinical care is an important mandate for laboratories in a value-based reimbursement system. The goal of this study was to determine the...

Implementation of Patient-reported Outcome Measures in Total Knee Arthroplasty.

Patient-reported outcome measures (PROMs) has emerged as a strategy to improve the outcome of total knee arthroplasty. The use of PROMs in routine clinical practice has accelerated because health care in the United States is shifting from a volume-based to a value-based reimbursement system in which quality is increasingly being measured using PROMs. Electronic, internet-based platforms, such as Functional and Outcomes Research for Comparative Effectiveness in Total Joint Replacement, currently exist which offer turn-key solutions for PROM collection, trending, analysis, and benchmarking for busy clinicians. Successful systems provide real-time trended PROM scores that inform shared decision making, optimize patient care, and enable comparisons among practices.

Personality disorders and the “difficult” dermatology patient: Maximizing patient satisfaction

Personality disorders (PDs) are stable and enduring patterns of thought, feeling, and behavior that deviate from one’s cultural norms and cause impairment in functionality. Patients with PDs are commonly encountered in the dermatologic setting and can be perceived by providers as “difficult.” Given that PDs are chronic, rigid, and frustrating to deal with, it is important to be skillful in the approach to such patients, especially in the era of the value-based reimbursement system, in which patient satisfaction is crucial for reimbursement. This contribution discusses four PDs most commonly encountered in the dermatology setting: Borderline, histrionic, obsessive-compulsive, and narcissistic. Although the details regarding the approach to patients for each PD differ as discussed, once a PD is identified, there are few key management strategies that can be helpful in minimizing conflict and enhancing outcomes. In patients with PD, the presenting skin complaint is often a secondary problem, as there may be an underlying psychologic issue (somatization). Understanding the underlying psychologic aspect of the patients’ dermatologic complaints and adapting behaviors to the patients’ needs are fundamental for maximizing patient satisfaction.

MACRA Volume Threshold Exempts Many M.D.s From 2017 Reporting

MACRA Volume Threshold Exempts Many M.D.s From 2017 Reporting

Provider-Sponsored Health Plans: A Tool for Moving Toward Value-Based Reimbursement

THE US HEALTHCARE SYSTEM is undergoing unprecedented change, particularly for this generation of healthcare leaders. The mandate to improve the patient experience of care (including quality and satisfaction), improve the health of populations, and reduce the per capita cost of healthcare-the Institute for Healthcare Improvement's Triple Aim-is being embraced by healthcare leaders across the country.A major driver in achieving the Triple Aim is the transformation of the reimbursement system from one that pays providers on the basis of volume to one that pays providers on the basis of value, rewarding (or penalizing) them for performance in managing cost, experience, and outcomes. Economically, this transformation calls for significant systemic change. The current fee-forservice payment structure cannot support the investments required to transition to a value-based reimbursement system or the threat this transition poses to provider income. Providers must retool to be able to accept performance risk. The authors of the two feature articles in this issue of Frontiers describe Spectrum Health's and Health First's experiences that led these organizations to take on risk at its highest level: to participate directly in a health insurance product.Entering the health insurance business is not for the faint of heart. Healthcare systems must carefully assess their capabilities, the competitive landscape in both provider and health insurance markets, and their tolerance for risk. Owning a health plan is not the right solution for all providers and all markets, but it is an option health systems may consider as they develop the capabilities required for a value-based reimbursement system. The strategic benefits to going down this path also differ, as Breon describes for Spectrum Health, a not-for-profit, integrated delivery system based in Grand Rapids, Michigan, and as Johnson outlines for Health First, a not-for-profit community health system based in Rockledge, Florida.Johnson notes that one of Health First's primary goals is using the health plan strategy as a catalyst for developing an integrated delivery network (IDN). Breon views Spectrum Health's decades-long experience with its health plan, Priority Health, as a key driver in achieving its mission to improve the health of the communities it serves and deliver on its value proposition. After a comprehensive self-assessment, Froedtert Health, based in Milwaukee, Wisconsin (Exhibit i), determined that health plan ownership, in alignment with other strategies for its clinically integrated network (CIN), offered a unique opportunity to take the next step in assuming risk and delivering value directly to our community.THE DECISION TO PURSUE HEALTH PLAN OWNERSHIPAlthough Froedtert Health's deliberations regarding health plan ownership took a different course than Health First's and Spectrum Health's did, it included an evaluation of many of the same factors addressed by Johnson and Breon. With passage of the Affordable Care Act and the resulting movement by the federal government and private payers toward valuebased reimbursement, Froedtert Health's management team concluded that the organization needed to improve its capability to assume and manage more financial risk than its fee-for-service contracts allowed. The alternative would be reduced rates for each unit of service (e.g., a hospital stay) and reduced utilization, with no reward for the work we, as providers, were doing to manage care. However, the management team determined that the health system was not large enough to serve our market on its own. In addition, having the region's only academic medical center (Froedtert and the Medical College of Wisconsin) in our network would significantly increase the risk of adverse selection in any population attributed to our management.Several executives on our team had had previous success in developing CINs that allowed independent providers to interact collectively with the market (i. …

Now or Never: Making the Commitment to Value-Based Reimbursement

THE MARKET HAS spoken. Healthcare is too fragmented, inconsistent, redundant, and expensive. With a slew of value-based reimbursement reforms marching across the healthcare landscape, a fundamental shift is beginning to take hold. In their feature article, Henkel and Maryland point out that Ascension Health in St. Louis, Missouri, realized that a payment inflection point was bearing down faster than anticipated, stimulating them to make a bold commitment to building a value-based system. Similarly, Kuhn and Lehn relate how Banner Health Network (BHN), in Phoenix, Arizona, seized the initiative by volunteering for the Pioneer accountable care organization (ACO) program. Understanding the magnitude of the undertaking, both organizations realized that a significant investment was needed to transform the management of patient communities. Taking action ahead of competitors is risky, as any early adopter can attest, and it is not without setbacks and lessons learned. However, the accelerating pace of change is demanding action as payment innovations, which are beginning to yield cost and quality results, redefine the revenue model. Although the levels of these payments are currently marginal, the rise of consumerism brought about by exchanges and narrow networks is spurring a redesign of the care model. A tipping point will come when the bulk of revenue shifts from volume to value, as we discovered at Carroll Hospital Center in Westminster, Maryland, when we volunteered to participate in an experimental payment program.Many executives are struggling with the question of how legacy healthcare organizations should reinvent themselves to thrive under value-based reimbursement. Without question, underlying quality incentives-avoidable readmissions, process-of-care improvements, and disease management outcomes-are objectives that hospitals and healthcare systems should already be pursuing. Strategists and planners are grappling with the future business model even as current volume-based revenue continues to be the driver in most markets. Under diagnosis-related group case rates, hospitals have been fairly successful in driving down unit costs. Yet, the major gains will come from utilization management. This is the tricky strategic question: how and when to embrace a shrinking inpatient enterprise?The feature articles in this issue describe two organizations that anticipated the future and created it, often at great peril to existing business models. Unlike volumebased payment systems that fail to reward high-quality, low-cost providers, value-based reimbursement fosters real competition. Kuhn and Lehn describe how BHN stepped forward as a Pioneer ACO and garnered success in a program that has not proven to be a panacea for all, in light of the fact that about one-third of original members have dropped out. Sensing the impending impact of valuebased reimbursement, Henkel and Maryland describe how Ascension redirected resources to building MissionPoint Health Partners, a provider-sponsored organization that identifies high utilizers and develops focused care management for patients with chronic disease. Both organizations understood that the forces driving change were not only inevitable but welcome, because change would encourage and reward improvements in health and enhancement of patient experience at a reasonable cost.Inherent in these case studies are key success principles in value-based reimbursement: making the infrastructure commitment, transforming the cost structure, and collaborating across the healthcare delivery spectrum.MAKING THE VALUE COMMITMENTFor Carroll Hospital Center, the opportunity to make the value commitment came early, even before passage of the Affordable Care Act. In 2009, the state of Maryland rolled out a value-based reimbursement system that focused on potentially preventable conditions, core measures, and patient experience of care. Owing to its unique payment system, Maryland has become a hotbed of innovation. …

Redundancy and Variability in Quality and Outcome Reporting for Cardiac and Thoracic Surgery

Health care is evolving into a value-based reimbursement system focused on quality and outcomes. Reported outcomes from national databases are used for quality improvement projects and public reporting. This study compared reported outcomes in cardiac and thoracic surgery from two validated reporting databases—the Society of Thoracic Surgeons (STS) database and the National Surgical Quality Improvement Program (NSQIP)— from January 2011 to June 2012. Quality metrics and outcomes included mortality, wound infection, prolonged ventilation, pneumonia, renal failure, stroke, and cardiac arrest. Comparison was made by chi-square analysis. A total of 737 and 177 cardiac surgery cases and 451 and 105 thoracic surgery cases were captured by the STS database and NSQIP, respectively. Within cardiac surgery, there was a statistically significant difference in the reported rates of prolonged ventilation, renal failure, and mortality. No significant differences were found for the thoracic surgery data. In conclusion, our data indicated a significant discordance in quality reporting for cardiac surgery between the NSQIP and the STS databases. The disparity between databases and duplicate participation strongly indicates that a unified national quality reporting program is required. Consolidation of reporting databases and standardization of morbidity definitions across all databases may improve participation and reduce hospital cost.

Designing the Role of the Embedded Care Manager

: The role of the professional case manager is changing rapidly. Health reform has called upon the industry to ensure that care is delivered in an efficient, effective, and high-quality and low cost manner. As a means to achieve this objective, health plans and health systems are moving the care manager out of a centralized location within their organizations to "embedding" them into physician offices. This move enables the care manager to work alongside the primary care physicians and their high-risk patients. This article discusses the framework for designing and implementing an embedded care manager role into a physician practice. Key elements of the program are discussed. IMPLICATIONS FOR CARE MANAGEMENT:: Historically care management has played a foundational role in improving the quality of care for individuals and populations via the efficient and effective use of resources. Now with the goals of health care reform, a successful transition from a volume-based to value-based reimbursement system requires primary care physicians to welcome care managers into their practices to improve patient care, quality, and costs through care coordination across health care settings and populations. : As patient-centered medical homes and integrated delivery systems formulate their plans for population health management, their efforts have included embedding a care manager in the primary practice setting. Having care managers embedded at the physician offices increases their ability to collaborate with the physician and their staff in the implementation and monitoring care plans for their patients. : Implementing an embedded care manager into an existing physician's practice requires the following:Although the embedded care manager is a highly evolving role, physician groups are beginning to realize the benefits from their care management collaborations. Examples cited include improved outreach and coordination, patient adherence to care plans, and improved quality of life.

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