Guest post by Ken Perez, vice president of healthcare policy, Omnicell, Inc.
The Patient Protection and Affordable Care Act (ACA) mandated five major healthcare delivery reforms that collectively aim to improve care quality and slow the growth of healthcare spending. In the five years since passage of the ACA, each of these delivery reforms has been implemented, revised and broadened.
What is the outlook for these changes? Clearly, the long-term strategic intent of the Obama administration is to shift Medicare payments from fee for service to fee for value. On Jan. 26, 2015, Health and Human Services Secretary Sylvia Burwell set forth quantified goals and an aggressive timeline for directing an increasing share of Medicare payments through alternative payment models (APMs) such as accountable care organizations (ACOs) and bundled payments, from 20 percent in 2014 to 50 percent in 2018. Let’s consider each of the major healthcare delivery reforms.
Accountable Care Organizations
On January 11, the Centers for Medicare & Medicaid Services (CMS) announced that 477 organizations are participating in one of Medicare’s four accountable care programs.
With 434 current participants, the Medicare Shared Savings Program (MSSP) accounts for the vast majority (91 percent) of the total. Although the total number of MSSP ACOs has grown steadily each year since the program’s inception in 2012, cumulatively about 100 ACOs (19 percent) have dropped out of the program.
Medicare’s first ACO program, the higher-risk, higher-reward Pioneer ACO Model, suffered numerous departures during the second half of 2015, as the number of Pioneers has dropped from 32 original participants announced in December 2011 to a current total of nine, a 72 percent decline. However, some of the departing Pioneers have transferred to the MSSP or the even higher-risk, higher-reward Next Generation ACO Model, which was launched in March 2015.
CMS also disclosed that 21 organizations are participating in the Next Generation ACO Model, including five former Pioneers. The remaining 13 of the 477 ACOs are the initial participants in the first disease-specific Medicare ACO program, the Comprehensive ESRD Care Model, which was announced in October 2015.
Despite these seemingly impressive numbers, to achieve the aforementioned goal of flowing half of Medicare payments through APMs by 2018, CMS needs even more growth in the number of Medicare ACOs coming onboard in the next couple of years, perhaps 150-200 net new ACOs per year in 2017 and 2018.
In 2013, CMS launched the Bundled Payments for Care Improvement Initiative (BPCI), a voluntary program which offers providers four episode-based payment models. In three of the models, implementation is divided into two phases. During Phase 1, “the preparation period,” CMS shares data and helps the participating providers learn in preparation for Phase 2, “risk-bearing implementation,” in which the providers begin bearing financial risk with CMS for some or all of their episodes. CMS required all participants to transition at least one episode (e.g., Acute Myocardial Infarction) into Phase 2 by July 1, 2015, to continue participating in the BPCI.
It is estimated that one-fifth of the U.S. population will be 65 years or older by 2030. According to Florida Atlantic University, out of the 1.6 million Americans currently living in a nursing home, 60 percent of that population is sent to the emergency room, while another 25 percent are admitted to the hospital each year. As a result, the care transition process between senior communities and acute care providers has become critical to ensure the best outcomes for patients.
Traditionally, when a senior care resident is sent to a hospital, the receiving healthcare provider may not have a complete view of the patient’s history. Ideally, documentation and medical records should travel with the resident so that all the information clinicians will need to properly treat the individual will be available upon arrival. Unfortunately, this is often not the case.
The good news is that there is technology to help improve this process in three main ways:
Reducing unnecessary hospital readmissions
Reducing paper and therefore medication errors
Increased focus on person-centered care
Reducing unnecessary readmissions
There is a lot of talk in the industry about how technology is helping to reduce hospital readmissions, but these conversations often lack tangible, measurable results. One thing is certain – providers have benchmarks to meet. On Oct. 1, 2012, The Centers for Medicare & Medicaid Services (CMS) implemented penalties for hospital readmissions at a rate of one percent. By Oct. 1, 2014 this rate increased to three percent. By 2018, CMS is mandating that those same penalties that apply to hospitals will apply to skilled nursing facilities.
Hospital readmissions continue to be a major contributor to soaring healthcare costs and a drain on the U.S. economy. According to the Robert Wood Johnson Foundation, 4.4 million hospital readmissions account for $30 billion every year, while 20 percent of Medicare patients are expected to return to the hospital within 30 days of discharge. The Affordable Care Act of 2010 requires the U.S. Department of Health & Human Services to establish a readmission reduction program.
This program provides incentives for hospitals to implement strategies to reduce the number of costly and unnecessary hospital readmissions. Centers for Medicare and Medicaid Services (CMS) has created quality programs that reward healthcare providers and hospitals with incentive payments for using electronic health records (EHR) to promote improved care quality and better care coordination. The reasons for hospital readmissions include adverse drug effects (ADE), lack of a proper follow-up care, inability of patients to understand the importance of their medications and diagnoses, unidentified root causes, and misdiagnosis. Technology could play a vital role here by properly documenting, tracking, diagnosing, monitoring, and enabling better communication between patient and provider.
Adverse drug events constitute the majority of hospital readmissions. A cohort study, including a survey of patients and a chart review, at four adult primary care practices in Boston (two hospital-based and two community-based), involving a total of 1202 outpatients indicated that 27.6 percent of these ADEs were preventable, of which 38 percent were serious or fatal. Human error was the leading contributor to these ADEs, followed by patient adherence. Additionally, patients who screened positive for depression were three times as likely to be readmitted compared to others.
Our analysis indicates that 28 percent of adult hospital stays involved a mental health condition. A study of Medicaid beneficiaries in New York State determined that, among patients at high risk of rehospitalization, 69 percent had a history of mental illness and 54 percent had a history of both mental illness and alcohol and substance use. We know that a properly implemented mental health screening protocol can lead to effective diagnosis, and that proper management of these issues can positively impact the reduction of hospital readmissions.
Further studies show that most cases of readmissions for certain chronic conditions have an underlying mental health issue, which appears in patients who have not been previously diagnosed for a mental health condition (i.e., anxiety, bipolar disorder or depression). For example, anxiety and/or depression increases the risk of stroke and decreases post-stroke survival, and plays a key role in diabetes treatment as 33 percent of this patient population is found to be depressed and patients with bipolar disorder have reduced life spans. Other cases where depression affects the patient’s survival and treatment cost include hypertension, stable coronary disorder, ischemia, unstable angina, post myocardial infarction and congestive heart failure.
An important point to note: congestive heart failure is the major driver of hospital readmissions in the U.S., accounting for 24.7 percent of all readmissions. Another study concluded that patients with severe anxiety had a threefold risk of cardiac-related readmission, compared to those without anxiety.