Care Transformation Center Blog

Why Medicare's bundled payment model isn't changing SNF discharge patterns (and 6 ways to make a change)

by Clare Wirth and Tomi Ogundimu

The Bundled Payment for Care Improvement (BPCI) Initiative accelerated the shift of financial responsibility for post-discharge care to hospitals. In response, we'd expect participating hospitals and health systems to develop tighter relationships with post-acute care (PAC) providers to improve care coordination and control costs. Yet, new research suggests that skilled nursing facility (SNF) discharge patterns from hospitals participating and not participating in BPCI are largely the same.

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Why? The study authors propose three theories:

  1. To avoid violating patient choice laws, hospitals may provide impartial lists of local SNFs instead of highlighting high-quality, preferred providers;

  2. Hospitals may focus on developing post-discharge care pathways for specific clinical conditions rather than redesigning SNF referral patterns broadly; and

  3. Hospitals may prioritize home-based options for post-discharge care rather than referring patients to SNFs.

In absence of significant change, post-discharge utilization remains a major cost-driver. Studies attribute 44% of total episodic spending to post-discharge care. Of that, SNF and readmission payments account for 38% and 30%, respectively. One argument for building a preferred SNF network is to reduce costs, readmissions, and hospital lengths of stay.

Six lessons to develop a high-performing post-acute care network

Here's how to build a PAC network or audit your existing one:

  • Select partner PAC facilities based on performance (e.g., costs, readmissions, clinical improvement rates), PAC leadership's willingness to collaborate, patient utilization patterns, and convenience for patients (e.g., distance from hospital and patient homes);

  • Establish formal processes for data collection (e.g., monthly quality, staffing, patient experience, and utilization report cards from PACs) and evaluation (e.g., multidisciplinary team reviews data and conducts on-site qualitative assessments);

  • Prioritize your most-used SNFs when discharging patients, since data shows that readmission rates decrease as concentration of patients treated at the same facility increases;

  • Hold regular meetings with PAC partner consortium for education and best practice sharing;

  • Make it easy for time-pressed discharge planners to support patient decision-making (e.g., include details about in-network PAC capabilities in the support tool to filter out facilities unable to meet patient needs); and

  • Develop patient-facing resources to inform patients about discharge options, emphasizing that in-network options meet specific quality standards (e.g., offer threshold for inclusion).

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