How Post-Acute Providers Can Thrive Under Payment Reform

Under my previous employer, one of the largest and most successful single-state Blue plans in the nation, I observed first-hand the impact payment reform had on consumers, payers, providers and vendors in the acute healthcare market. My front-row seat on the 2010 passage of Obamacare - officially known as the Affordable Care Act or ACA - and the six years I spent setting strategy and managing teams through its implementation and annual enrollment taught me a business Truth. The ability to embrace change, coupled with a high-functioning internal organization who is armed with detailed scenario planning - and a steady hand at the top to guide it all - was the difference between a health plan’s success or demise.

I can appreciate the same experience holds true for payment reform in the post-acute sector, whether it’s PDPM for skilled nursing, PDGM for home health, or the unified payment model that waits just over the horizon for everyone. And I truly believe there’s much we can learn by adopting the best practices and avoiding the mistakes of those in other health sectors who’ve survived and thrived under payment reform.

Along those lines, one lesson is clear: analytics are everything.

In these first months under PDGM, the home health sector can look to payers and acute health providers, where the payment reform market is more mature, to gauge the relevance of analytics. You only need to walk the HIMSS expo floor (alas, not in 2020) to see the number of analytics vendors who’ve sprung up in the past decade. Dozens (hundreds?) now provide sophisticated, predictive reporting, AI-enabled decision making support, and other advanced capabilities. These sectors are fueled by actionable information. Risk-based arrangements and value-based care can’t survive without it. And signals from CMS on everything from quality scores to transparent pricing ensures analytics will continue to drive their business.

For more recent experience in the post-acute payment reform market, the home health industry should look to how their skilled nursing facility (SNF) colleagues are faring under PDPM. Wanting to be experts in all factors that impact our market, the team at Forcura did just that and recently hosted Mat Robie, a health industry expert with extensive experience up and down the care continuum. Mat made it clear that analytics will be equally critical for post-acute players to thrive in this new economy. 

For PDPM or PDGM, it all starts with data capture, according to Mat. Both SNF and home health will have to strategically adjust how they onboard patients so that both do a comprehensive data capture at the point of referral. As Mat shared, the most common diagnosis for a patient referred to SNF is “weakness.” This code will no longer be paid under the PDPM model and there are thousands of codes like it. For most patients, a skilled clinician at the SNF will have to read through the reams of referral documentation, piecing together the clues of the patient’s health history, discern why the patient is truly in need of skilled nursing care, and ensure the patient is a good match for the agency’s services. And while care plans can be updated as care is delivered, Mat warned that the bulk of what SNFs will be paid against is limited to that upfront documentation. SNFs who fall short here can stand to lose thousands in reimbursements.

Home health agencies can easily see the similarities to their new PDGM environment. They too are having to more fully document their patients’ conditions at the start of care. They also are having to allocate staff differently. And with compressed billing cycles and behavioral adjustment, many are going to struggle with cash flow unless they’ve prepared their teams and pressure-tested workflows and processes well ahead of January 1.

I can see the scenario planning I mentioned above truly coming into play in this first quarter (or second for SNF) as post-acute organizations dig into what is or is not going right with their operations, outcomes and financials. Are teams working as efficiently as possible? Are providers returning their signed orders within the given window? Are there opportunities for clinical specializations to be expanded?

What is common across all health sectors impacted by payment reform is that no one will be successful using manual processes or relying on reporting too arduous to run or utilize. Organizations with the right technology partners will know they’ve got the necessary data captured and workflows optimized as they conduct these internal reviews. Readily available and actionable analytics will be at the core of those decisions. And success will come to those who act on the best possible information.

I invite anyone who needs this kind of technology partner to reach out to Forcura today.

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Annie 10-Retouched


As Chief Strategy Officer, Annie Erstling is responsible for driving growth at Forcura. She oversees the company's strategic planning, product innovation, marketing and strategic partnerships. She has experience launching new brands, products and companies across the healthcare and technology sectors.

Connect with Annie on LinkedIn.

Topics: Innovation & Interoperability in Healthcare, CMS Regulatory Guidance

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