Practice Management

How will SNF readmissions penalties affect hospitalists?

Post-acute care utilization is rising, resulting in rapidly increasing costs


Starting in 2018, skilled nursing facilities (SNFs), like acute care hospitals before them, will be subject to a penalty of up to 2% of their Medicare reimbursement for posting higher-than-average rates of hospital readmissions.

The Protecting Access to Medicare Act of 2014 established a value-based purchasing component for SNFs, including incentives for high-performing facilities and a measure for all-cause, all-condition readmissions to any hospital from the SNF within 30 days following hospital discharge – designed to recognize and reward, or punish, facilities’ performance on preventing unnecessary readmissions. Public reporting of SNF quality data, including readmission rates, started in October 2017. Penalties follow a year later. Some patients’ readmissions could trigger penalties for both the hospital and the SNF.

According to 2010 data, 23.5% of patients discharged from acute care hospitals to SNFs were readmitted to the hospital within 30 days, at a financial cost of $10,362 per readmission or $4.34 billion per year.1 Seventy eight percent of these readmissions were labeled avoidable. More recent evidence suggests that hospitalization rates for dual-eligible patients living in long-term care facilities decreased by 31% between 2010 and 2015.2As increasing numbers of hospitalists spend some or all of their work week in post-acute care settings, how will the SNF readmission penalty affect their relationships with post-acute facilities?

DR. Benjamin Frizner, director of quality and  performance, CEP America

Dr. Benjamin Frizner

“As of now, the incentives or penalties haven’t gotten to the level of the individual physician working in long-term care,” said Benjamin Frizner, MD, FHM, director of quality and performance for CEP America, a national provider of emergency, hospital, and post-acute medicine. Thus, doctors’ professional fees are not affected, he said.

Experts say SNFs – as with hospitals before them – lack the ability to allocate rewards or penalties for readmission rate performance to individual doctors. But increasingly close collaborative relationships between post-acute facilities and the hospitalists who work in post-acute care mean that the hospitalist has an important role in helping the SNF to manage its readmissions exposure.

“Hospitals and hospitalists want to keep good relationships with the SNFs they partner with, for a variety of reasons,” Dr. Frizner said. “We believe that the best way to reduce readmissions and unplanned transfers from the SNF is for the doctor to know the patient. We need dedicated doctors in the facility. We want hospitalists who already know the patient to come to the facility and see the patient there.”

The hospitalist’s role in post-acute care

Hospitalists who work in post-acute care typically make scheduled, billable medical visits to patients in long-term care facilities, and may also take on roles such as facility medical director or contribute to quality improvement. Relationships may be initiated by a facility seeking more medical coverage, by a hospitalist group seeking additional work or an ability to impact on the post-acute care delivered to hospital patients discharged to the facility, or by health systems, health plans, or accountable care organizations seeking to better manage the quality of care transitions for their beneficiaries.

Dr. Amy Boutwell, Collaborative Healthcare Strategies

Dr. Amy Boutwell

“The facility can ask the hospitalists to come in, or the hospitalist group can ask to come in. You have all of that – plus you’ve got big regional and national hospitalist companies that sign contracts with hospitals and with large SNFs,” explained Amy Boutwell, MD, MPP, founder of the Massachusetts-based consulting group Collaborative Healthcare Strategies. “It’s clearly becoming more common with current market pressures,” she said.

“What I’m seeing is that with opportunities for bundled payments, we all have new incentives for moving patients along and reducing waste,” Dr. Boutwell said. “For hospitalists practicing in SNFs, it’s going to be a much bigger phenomenon. They’ll be called to reevaluate patients and make more visits than they have been accustomed to.” She hopes SNFs are studying what happened with hospitals’ readmission penalties, and will respond more quickly and effectively to their own penalty exposure.

Dr. Robert W. Harrington of Plano, TX

Dr. Robert W. Harrington

Robert Harrington, Jr., MD, SFHM, a hospitalist in Alpharetta, Ga., and chief medical officer at Reliant Post-Acute Care Solutions, calls the readmission penalties an extension or further progression of the government’s value-based purchasing mentality.

“What we are seeing is an effort to shift folks to lower cost – but still clinically appropriate – levels of care,” he said. “These dynamics will force SNFs to reevaluate and improve their clinical competencies, to accept patients and then treat them in place. It’s no longer acceptable for the medical director to make rounds in person twice a month and do the rest by telephone.”

Instead, someone needs to be on site several times a week, working with nursing staff and developing protocols and pathways to control variability, Dr. Harrington said. “And in many cases that will be a hospitalist. Hospitalists are finding ways to partner and provide that level of care. I believe good hospitalist groups can change the facility for the better, and fairly quickly.”


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