With the healthcare industry’s increased focus on value-based purchasing, debate continues as to whether hospitals are meeting standards for total Medicare Spending Per Beneficiary (MSPB).

Janelle Shepard, MBA, BSN, RN-BC, senior director and system officer of care transitions/utilization management/care continuum management at Texas Health Resources (THR) in Arlington, revealed her findings in a presentation titled “Get More Bang for Your Post-Acute Buck,” during the American Case Management Association’s Leadership and Physician Advisors Conference Nov. 6, 2018, in Huntington Beach, CA.

Shepard notes that North Central Texas — an area with more than 7.4 million people and growing — does not require a certificate of need to build a medical facility.

“The Kaiser Foundation ranks Texas number three in the nation for high Medicare spending,” Shepard says. “In the Dallas/Fort Worth area, we are well known for overutilizing all sorts of healthcare.”

Shepard says the MSPB measure is the Center for Medicare & Medicaid Service’s way of gauging a hospital’s financial efficiency. THR's goals are to analyze and critique current MSPB; to develop and implement a standard for appropriate and efficient post-acute care placement; and to build and support a network of post-acute providers.

“The mathematical formula averages the amount of Medicare dollars each hospital spends per patient on Medicare Part A and Part B benefits,” she explains. “They then compare that number to a risk-adjusted national average across all hospitals for a Medicare-spending episode."

Shepard says value-based purchasing currently measures and can penalize hospitals for the MSPB. She notes that a Medicare spending episode begins three days before hospital admission, continues through hospitalization, and ends 30 days after hospital discharge.

Shepard adds that THR continues to see increased populations for risk management, with high volumes of patients being sent to post-acute care.

Categories where such episodes occur include: acute hospital admission; long-term acute care hospitals (LTACHs); hospice services; outpatient services; physician services; skilled nursing and acute rehabilitation facilities; Medicare home health agencies; and durable medical equipment services.

“While hospital administrators have voiced concerns about the ‘fairness’ of making hospitals accountable for spending they have no control over, CMS responded appropriately with ‘perceived fairness is not the point,’” says Shepard.

“CMS believes that including Medicare payments paid to all providers during the Medicare spending episode encourages hospital case managers and physicians to evaluate closely the medical necessity of every service ordered. Their logic is that it should reduce Medicare spending and delivery system fragmentation.”

During her remarks at the conference, Shepard outlined THR’s processes for patient care. She says a care continuum system officer leads care transitions, with UR departments reporting to the chief medical officer.

Each facility in the system, says Shepard, contains two physician advisors who are responsible for handling physician education, case escalations, denials, and appeals. Other provisions within THR include: a physician advisor in revenue cycling for coding, clinical documentation improvement, a central business office, and appeal oversight.

Shepard says that thirteen THR hospitals feature care transition departments with more than 250 RN case managers, and social workers known as care transition managers.

“Due to an oversaturation of IRF and LTAC beds, the DFW market has historically pulled patients inappropriately to the higher levels of care. Patients would bounce from hospital to LTAC to IRF. Medicare patients became ‘unfunded’ because they used all of their acute Medicare days.”

Shepard adds that skilled facilities struggled to develop staff with comprehensive skills to care for the patients with more intense medical needs.

“THR began seven years ago to work with SNFs to increase their ability to take sicker patients and provide more appropriate care at the skilled level,” she says.

Shepard emphasizes that healthcare providers can control costs without causing harm to their patients.

“When true clinical criteria are applied, you are doing the right thing for the patient,” she says.

“Physician advisors were especially helpful with physicians accustomed to overutilizing resources.This is not the ‘Easy Button’ for discharge planning, but the right thing to do.”