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Change is on the way for hospital CMs
Hospital reimbursement as we know it is changing as the Centers for Medicare and Medicaid Services (CMS) rolls out new initiatives that base payments to hospitals on value as well as volume. In this issue of Hospital Case Management, we take a look at some of the changes that are coming down the pike and how they will affect case management. We'll give details on the value-based purchasing program, the initiative to reduce reimbursement for excess readmissions, and the new bundled-payment quality measure. We also offer tips for helping your hospital receive appropriate payment. It's all in this issue of Hospital Case Management
Reimbursement changes coming– CMs key to meet payer requirements
Work with quality, physicians on deficits
When it comes to ensuring that patients are receiving high-value, cost-effective care, case managers are where the rubber hits the road, says Michael Taylor, MD, vice president of operations at Executive Health Resources, a Newton Square, PA, healthcare consulting firm.
"As the Centers for Medicare and Medicaid Services [CMS] and commercial payers shift from paying for volume to paying for value, case managers are going to have a very important role in helping their hospitals achieve correct reimbursement for services that are compliant with regulatory requirements," Taylor says. "From now on, hospitals are not going to be compensated just for how many services they provide but for the outcomes of those services. They are going to be responsible for the outcomes of the care they provide as well," Taylor says.
The changes in reimbursement create incentives for hospitals to improve care; however, in many cases, the stick is bigger than the carrot, and many hospitals are going to lose, Taylor says. "The programs are not designed so that if everybody does a better job they will do well," he says. "Hospitals literally have to outperform other hospitals in order to benefit. It's likely that there will be more financial penalties in the future for hospitals that have high utilization and spending patterns across the continuum."
The Inpatient Prospective Payment System final rule for 2012 is one of the first times that CMS has been so clear about how quality is going to affect reimbursement, says Beverly Cunningham, RN, MS, vice president, clinical performance improvement, Medical City Dallas Hospital, and partner and consultant in Case Management Concepts in Dallas. "There are a lot of changes coming down the pike," Cunningham says. "It's important for case management leaders to understand that what case management does relates to the new reimbursement measures and how they affect the overall quality provided by the hospital. The bottom line is that these measures are simply doing the right thing for patients."
Taylor suggests that case management directors start by working with their hospital's internal quality department and engaging the physician staff as well. "There needs to be a combination of representatives from case management, quality, and the physician leadership who assess the different value-based purchasing measures and come up with a plan to address them," Taylor says.
Identify which patients are frequently readmitted and how much the hospital is spending on them, says Joanna Malcolm, RN, CCM, BSN, consulting manager, clinical advisory services for Pershing, Yoakley & Associates, a healthcare consulting firm in Atlanta. Look at how well they were ready for discharge, and determine where the deficits are in your educational process. she says.
Hospitals need to provide better education while patients are in the hospital and to start making follow-up calls after discharge to make sure the patients understand their treatment plan and are following the recommended regimen, Malcolm says. "Not only do hospitals have to make sure patients have a good discharge plan, that they understand their diagnosis, and what they should do when they get home; hospital case management must now extend into the patient's homes," she says.
Spend time with patients who are frequently admitted and those who have newly diagnosed heart failure, Malcolm suggests. Make sure they understand their treatment plan, and find out if they have any questions. Build a relationship with your patients so they will learn to take care of themselves and stay out of the hospital, she says. "Often case managers don't follow up with patients to make sure they understand their treatment plan either because they don't have the time or they don't realize it is part of their job," Malcolm says.
A proactive approach to readmissions
In some cases, reducing readmissions hinges on patient adherence, Malcolm points out.
"If a heart failure patient doesn't take the medication or eats and drinks more than allowed, they're going to come back to the hospital," she says. "Unfortunately, hospitals are going to be penalized for patients' noncompliance."
Taylor predicts that in the future, hospitals might take more innovative approaches to reducing readmissions and optimizing post-acute care, such as increased use of telemedicine. "That hasn't happened yet largely because there has not been a clear financial incentive to do so," he says.
Case managers should work with the clinical nursing staff to develop check lists to make sure best practices and protocols are being followed, Taylor adds. For example, when a patient has joint replacement surgery, case managers could serve as an additional check to make sure that a physical therapist gets the patient out of bed and walking as soon as clinically appropriate. "It might not be obvious up front, but something as simple as early mobilization can sometimes affect the spending-per-beneficiary by possibly reducing the complications and the need for extensive outpatient therapy after discharge," Taylor says.
Look at how the hospital is performing now on CMS quality measures. Use physician and nurse resources to create a plan to address those issues. "Case management leadership should assess the department and create a plan to assess whatever deficits show up," Taylor says.
In case management departments in which utilization review staffs and care management staffs are different, both groups need to work together, he says. "All case managers need to work together, regardless of their assigned tasks. Value-based purchasing has both clinical and payment implications," Taylor says.
Malcolm cautions against giving case managers so many responsibilities they can't handle any of them adequately. Many times, jobs are assigned to the case managers because they're already in the record and are talking with patients, she points out.
"Case management directors need to make sure that case managers have the time to take the extra steps that are going to be required with the new reimbursement initiatives," Malcolm says. "When you start putting too much on people, they start sinking. Hospitals are going to need to consider increasing the number of staff and decreasing the case management caseload to the lower limits of the benchmark in order to make sure the staff has time to ensure the hospital is being paid appropriately."
Reimbursement changes are on the way
Medicare will pay for value, and volume
In a few years, hospital reimbursement is going to be a whole new ballgame as the Centers for Medicare and Medicaid Services (CMS) rolls out a plethora of changes in the way hospitals are paid, mandated by the Patient Protection and Accountable Care Act.
Hospitals will have a lot at stake as the new payment programs are rolled out, says Joanna Malcolm, RN, CCM, BSN, consulting manager, clinical advisory services for Pershing, Yoakley & Associates, a healthcare consulting firm in Atlanta. "It's going to be hard to stay on top of all the processes and performance measures on which they are going to be rated," Malcolm warns. "Case managers need to start looking at ways to get ahead of the game and to develop initiatives to improve quality and efficiency."
Beginning with discharges on or after Oct. 1, 2012, the Hospital Value-Based Purchasing program will use a complicated formula to reward or penalize hospitals for how well they perform. Michael Taylor, MD, vice president of operations at Executive Health Resources, a Newton Square, PA, healthcare consulting firm points out that the Value-Based Purchasing program is designed to be revenue neutral, which means it will be more of a penalty program than an incentive program. Hospitals that perform well on quality measures compared to other hospitals and/or improve their performance on the measures will receive value-based incentive payments. Reimbursement will be reduced for those who do not perform well. (For more details on value-based purchasing and a list of quality measures, see below.)
Also beginning in fiscal 2013, CMS will begin penalizing hospitals if they are in the top tier of hospitals with 30-day readmissions for heart failure, pneumonia, and acute myocardial infarction (AMI). Eventually, hospitals that are in the top 25% of hospitals with 30-day readmissions for the three diagnoses will be penalized as much as 3% of all discharges. Beginning with discharges on or after Oct. 1, 2012, hospitals in the top tier will be penalized by 1% of their total discharges. The figure goes up to 2% in fiscal 2014 and 3% in fiscal 2015.
CMS has announced its intention to add outcomes and efficiency measures to value-based purchasing and to add diagnoses to the readmission reduction program in the future. In addition, CMS has announced a Medicare spending-per-beneficiary performance measure that will be used in the Inpatient Quality Reporting program and for the value-based purchasing program. The spending-per-beneficiary performance measure will be implemented in fiscal 2014 and for the first year, it will be determined by data from hospital discharges cover hospital discharges from May 15, 2012, through Feb. 14, 2013. CMS will calculate the Medicare Part A and B spending per beneficiary beginning three days prior to an admission through 30 days after the patient is discharged from the hospital.
Susan Wallace, MEd, RHIA, CCS, CCDS, director of inpatient compliance for Administrative Consultant Services, a healthcare consulting firm based in Shawnee, OK, explains that during the first year, data from the Medicare spending-per-beneficiary initiative will be used for Inpatient Quality Reporting and posted on the Hospital Compare Web site (http://www.hospitalcompare.hhs.gov). In subsequent years, the data will become part of value-based purchasing, and hospital performance on that measure will make up 20% of the value-based purchasing scores, Wallace adds.
CMS acknowledges that physician management, beneficiary compliance with post-discharge instructions, and availability of community resources might contribute to Medicare spending after discharge, says Deborah Hale, CCS, president of Administrative Consultant Services, Shawnee, OK. "But CMS has stated that hospitals have a significant influence on Medicare spending if they provide appropriate, high-quality care before and during a hospital stay and do a good job of discharge planning, care coordination, and transitioning patients to the next level of care," Hale says. "Medicare spending-per-beneficiary means that hospitals will have a lot more at stake than just finding a place for a patient to go after discharge.
Case managers will need to become involved in decisions about the post-hospital setting and make sure the providers to whom they discharge patients provide cost-effective and high quality care, Hale adds.
Tracking patients after discharge
Beverly Cunningham, RN, MS, vice president, clinical performance improvement, Medical City Dallas Hospital, and partner and consultant in Case Management Concepts in Dallas, suggests that case management directors start tracking where patients are going after discharge and where patients are coming from when they are readmitted if they aren't already doing so. "It falls back to the case management leadership to know the results of care their patients receive at the next level of care," she says. "If patients who are referred to a certain home care agency or a skilled nursing facility are frequently readmitted, you know there is a problem there."
Taylor says, "Hospitals need to pay close attention to improving quality by making sure they do the right thing in the right way at the right time." For example, reducing infection rates involves using the proper techniques, the right equipment, and the right cleaning methods, but it also means moving patients through the hospital efficiently so the chances of infection are reduced, he says.
However, moving patients through the continuum must be balanced against readmission reduction efforts, Taylor says. "Hospitals have to find a way to provide high-value, cost-effective care while improving care transitions between inpatient and post-acute levels of care," he says.
There is concern in the provider industry that the CMS has not yet found a formula that makes the new reimbursement initiatives fair to hospitals across the board, Taylor adds.
"In the meantime, it's clear that hospitals need to focus on reducing all readmissions and give specific attention to reducing readmissions for patients with heart failure, pneumonia, and AMI," he says. "At the same time, they should pay close attention to the measures CMS designates for value-based purchasing and institute programs to optimize the value they are providing with regard to those measures."
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Value-based purchasing targets performance
Emphasis on quality and patient satisfaction
Beginning in fiscal 2013, Medicare will make incentive payments to hospitals based on how well they perform or how much they improve their performance during a baseline period that began July 1, 2009, and ended March 10, 2010.
In the initial year of value-based purchasing, the Centers for Medicare and Medicaid Services (CMS) will measure hospital performance using two domains: the clinical process of care which includes 12 clinical process measures, and the patient experience of care, using eight measures from the Inpatient Quality Reporting program. In fiscal 2013, the clinical processes of care will be weighted at 70%, and the patient experience of care will be weighted at 30%, when the scores are calculated. (See box, below, for full list of quality measures).
Hospital scores will be based on achievement, or how much their current performance on the measures differs from that of all other hospitals during the baseline period. In addition, hospitals will be assessed based on how much their current performance changes from their own baseline performance period.
Under value-based purchasing, hospitals will automatically receive a percentage reduction on all MS-DRG payments. Depending on their performance on the value-based purchasing measures, they will receive incentive payments, says Susan Wallace, MEd, RHIA, CCS, CCDS, director of inpatient compliance for Administrative Consultant Services, a healthcare consulting firm based in Shawnee, OK. "Some extremely efficient hospitals could earn back more than they lose. Others will be in the bottom percentage of performers and will not be able to earn back the reduction," Wallace says.
Starting in fiscal 2013, 1% of the revenue from all admissions is at stake. It goes up to 1.25% in 2014 and maxes out at 2% in 2017 and beyond.
Under federal law, CMS cannot use a measure for value-based purchasing unless it is part of the Inpatient Quality Reporting program and has been published on the Hospital Compare web site (http://www.hospitalcompare.hhs.gov) for at least a year, says Beverly Cunningham, RN, MS, vice president, clinical performance improvement, Medical City Dallas Hospital, and partner and consultant in Case Management Concepts, based in Dallas. However, case management leaders need to be aware that anything CMS includes on Hospital Compare can be added to value-based purchasing in the future, Cunningham says.
"CMS is already reporting mortality and readmission data on Hospital Compare and has indicated that it will include average length of stay [LOS] by medical service category as a quality measure sometime in the future," she says. "They've given us our warning, and we need to pay attention."
Quality Measures That Will Be Used for Fiscal 2013
Clinical Process of Care Measures
• Acute Myocardial Infarction
— Fibrinolytic therapy received within 30 minutes of hospital arrival
— Primary percutaneous coronary intervention within 90 minutes of hospital arrival
• Heart Failure
— Discharge instructions
— Blood cultures performed in ED prior to initial antibiotic received in hospital
— Initial antibiotic selection for community-acquired pneumonia in immunocompetent patient
— Influenza vaccine
• Healthcare-Associated Infections
— Prophylactic antibiotic received within one hour prior to surgical incision
— Prophylactic antibiotic selection for surgical patients
— Prophylactic antibiotics discontinued within 24 hours after surgery end time
— Cardiac surgery patients with controlled 6 a.m. postoperative serum glucose
• Surgical Care Improvement
— Surgery patients on a beta blocker prior to arrival that received a beta blocker during the perioperative period
— Surgery patients with recommended venous thromboembolism prophylaxis ordered
— Surgery patients who received appropriate venous thromboembolism prophylaxis within
— 24 hours prior to surgery to 24 hours after surgery
• Patient Experience of Care Measures
— Communication with nurses
— Communication with doctors
— Responsiveness of hospital staff
— Pain management
— Communication about medicines
— Cleanliness and quietness of hospital environment
— Discharge information
— Overall rating of hospital
Source: Centers for Medicare and Medicaid Services, Washington, DC.