Selecting preferred post-acute partners is just one step in the overall process of building a successful post-acute network. Once those partners are identified, however, the next step is to determine how those partnerships are structured.

In the article below, we outline how to establish the appropriate partnership models with your chosen post-acute care partners. These partnership structures provide direction ensuring that post-acute providers are optimally utilized in the network and promote long-term collaboration.

To learn more about our recommended approach to how you should structure your post-acute network, download our guide: PAC 101: The Rationale for a Post-Acute Network - Part 3: How can you build a post-acute network?

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The process of identifying optimal post-acute care partners concludes with outlining how those relationships will be structured. Hospitals must determine the appropriate model for partnership with each post-acute care provider. Three main categories of partnership models exist, with varying degrees of formality and financial commitment:

1. Joint Quality Improvement: Providers collaborate to set quality standards and improve performance. This type of partnership requires only the commitment of time from existing health system staff to improve coordination with post-acute providers.
2. Strategic Contracting: The hospital contracts with a specific PAC provider to accomplish population health goals, e.g., operate a transitional care program.
3. Post-Acute Asset Operation: The hospital assumes a form of equity in post-acute care in order to exert greater control over this portion of the care continuum. Some hospitals own post-acute assets outright, while others choose to leverage the expertise of an external partner through a joint venture or managed services agreement.

Regardless of the partnership model chosen, hospitals should consider developing affiliation agreements—documents which establish a relationship between providers without a merger or transfer of money. Such agreements formalize expectations and responsibilities. They also serve as a helpful tool for ensuring relationships are documented and compliant with all relevant legal regulations.

When creating these partnership models and documenting the details, keep in mind the key legal considerations for acute and post-acute partnerships. We’ve outlined a sample list of these below and recommend you work closely with your legal counsel during these discussions.

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Key Legal Considerations for Acute/PAC Partnerships

• Anti-Kickback and Stark Regulations: Stark, Federal Anti-Kickback, and Civil Monetary Penalties restrict certain types of coordination between health care providers.
• Referral Process and Patient Choice: CMS requires preservation of patient choice; some PAC settings have predetermined criteria for admission.
• Health Care Reform Considerations: Network may choose to move into financial arrangement, e.g., bundled payment, in the future.

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