Association of Medicare Mandatory Bundled Payment System for Hip and Knee Joint Replacement With Racial/Ethnic Difference in Joint Replacement Care.

Importance: There are marked racial/ethnic differences in hip and knee joint replacement care as well as concerns that value-based payments may exacerbate existing racial/ethnic disparities in care. Objective: To examine changes in joint replacement care associated with Medicare's Comprehensive Care for Joint Replacement (CJR) model among White, Black, and Hispanic patients. Design, Setting, and Participants: Retrospective cohort study of Medicare claims from 2013 through 2017 among White, Black, and Hispanic patients undergoing joint replacement in 67 treatment (selected for CJR participation) and 103 control metropolitan statistical areas. Exposures: The CJR model holds hospitals accountable for spending and quality of joint replacement care during care episodes (index hospitalization through 90 days after discharge). Main Outcomes and Measures: The primary outcomes were spending, discharge to institutional postacute care, and readmission during care episodes. Results: Among 688 346 patients, 442 163 (64.2%) were women, and 87 286 (12.7%) were 85 years or older. Under CJR, spending decreased by $439 for White patients (95% CI, -$718 to -$161; from pre-CJR spending in treatment metropolitan statistical areas of $25 264) but did not change for Black patients and Hispanic patients. Discharges to institutional postacute care decreased for all groups (-2.5 percentage points; 95% CI, -4.7 to -0.4, from pre-CJR risk of 46.2% for White patients; -6.0 percentage points; 95% CI, -9.8 to -2.2, from pre-CJR risk of 59.5% for Black patients; and -4.3 percentage points; 95% CI, -7.6 to -1.0, from pre-CJR risk of 54.3% for Hispanic patients). Readmission risk decreased for Black patients by 3.1 percentage points (95% CI, -5.9 to -0.4, from pre-CJR risk of 21.8%) and did not change for White patients and Hispanic patients. Under CJR, Black-White differences in discharges to institutional postacute care decreased by 3.4 percentage points (95% CI, -6.4 to -0.5, from the pre-CJR Black-White difference of 13.3 percentage points). No evidence was found demonstrating that Black-White differences changed for other outcomes or that Hispanic-White differences changed for any outcomes under CJR. Conclusions and Relevance: In this cohort study of patients receiving joint replacements, CJR was associated with decreased readmissions for Black patients. Furthermore, Black patients experienced a greater decrease in discharges to institutional postacute care relative to White patients, representing relative improvements despite concerns that value-based payment models may exacerbate existing disparities. Nonetheless, differences between White and Black patients in joint replacement care still persisted even after these changes.

Accountable Care Organizations and Post-Acute Care: A Focus on Preferred SNF Networks.

Due to high magnitude and variation in spending on post-acute care, accountable care organizations (ACOs) are focusing on transforming management of hospital discharge through relationships with preferred skilled nursing facilities (SNFs). Using a mixed-methods design, we examined survey data from 366 respondents to the National Survey of ACOs along with 16 semi-structured interviews with ACOs who performed well on cost and quality measures. Survey data revealed that over half of ACOs had no formal relationship with SNFs; however, the majority of ACO interviewees had formed preferred SNF networks. Common elements of networks included a comprehensive focus on care transitions beginning at hospital admission, embedded ACO staff across settings, solutions to support information sharing, and jointly established care protocols. Misaligned incentives, unclear regulations, and a lack of integrated health records remained challenges, yet preferred networks are beginning to transform the ACO post-acute care landscape.

Market and organizational factors associated with hospital vertical integration into sub-acute care.

BACKGROUND: Changes in payment models incentivize hospitals to vertically integrate into sub-acute care (SAC) services. Through vertical integration into SAC, hospitals have the potential to reduce the transaction costs associated with moving patients throughout the care continuum and reduce the likelihood that patients will be readmitted. PURPOSE: The purpose of this study is to examine the correlates of hospital vertical integration into SAC. METHODOLOGY/APPROACH: Using panel data of U.S. acute care hospitals (2008-2012), we conducted logit regression models to examine environmental and organizational factors associated with hospital vertical integration. Results are reported as average marginal effects. FINDINGS: Among 3,775 unique hospitals (16,269 hospital-year observations), 25.7% vertically integrated into skilled nursing facilities during at least 1 year of the study period. One measure of complexity, the availability of skilled nursing facilities in a county (ME = -1.780, p < .001), was negatively associated with hospital vertical integration into SAC. Measures of munificence, percentage of the county population eligible for Medicare (ME = 0.018, p < .001) and rural geographic location (ME = 0.069, p < .001), were positively associated with hospital vertical integration into SAC. Dynamism, when measured as the change county population between 2008 and 2011 (ME = 1.19e-06, p < .001), was positively associated with hospital vertical integration into SAC. Organizational resources, when measured as swing beds (ME = 0.069, p < .001), were positively associated with hospital vertical integration into SAC. Organizational resources, when measured as investor owned (ME = -0.052, p < .1) and system affiliation (ME = -0.041, p < .1), were negatively associated with hospital vertical integration into SAC. PRACTICE IMPLICATIONS: Hospital adaption to the changing health care landscape through vertical integration varies across market and organizational conditions. Current Centers for Medicare and Medicaid reimbursement programs do not take these factors into consideration. Vertical integration strategy into SAC may be more appropriate under certain market conditions. Hospital leaders may consider how to best align their organization's SAC strategy with their operating environment.

Hospital Vertical Integration Into Subacute Care as a Strategic Response to Value-Based Payment Incentives, Market Factors, and Organizational Factors: A Multiple-Case Study.

This study explores the extent to which payment reform and other factors have motivated hospitals to adopt a vertical integration strategy. Using a multiple-case study research design, we completed case studies of 3 US health systems to provide an in-depth perspective into hospital adoption of subacute care vertical integration strategies across multiple types of hospitals and in different health care markets. Three major themes associated with hospital adoption of vertical integration strategies were identified: value-based payment incentives, market factors, and organizational factors. We found evidence that variation in hospital adoption of vertical integration into subacute care strategies occurs in the United States and gained a perspective on the intricacies of how and why hospitals adopt a vertical integration into subacute care strategy.

The effect of integration of hospitals and post-acute care providers on Medicare payment and patient outcomes.

In this paper we examine empirically the effect of integration on Medicare payment and rehospitalization. We use 2005-2013 data on Medicare beneficiaries receiving post-acute care (PAC) in the U.S. to examine integration between hospitals and the two most common post-acute care settings: skilled nursing facilities (SNFs) and home health agencies (HHA), using two measures of integration-formal vertical integration and informal integration representing preferential relationships between providers without formal relationships. Our identification strategy is twofold. First, we use longitudinal models with a fixed effect for each hospital-PAC pair in a market to test how changes in integration impact patient outcomes. Second, we use an instrumental variable approach to account for patient selection into integrated providers. We find that vertical integration between hospitals and SNFs increases Medicare payments and reduces rehospitalization rates. However, vertical integration between hospitals and HHAs has little effect, nor does informal integration between hospitals and either PAC setting.

[Postacute care]. / Cuidados postagudos.

The aging of the population and changes in family and social structures have led to increasing care needs for elderly persons following an acute disease or accident, with consequent concerns regarding costs and sustainability within the public health system. The main objective of postacute care (PAC) is to restore the functional capabilities of the patient after an acute event and contribute to determine the patient's outcome and future healthcare requirements. With this background, we carried out a systematic review of the published literature from 1990 to 2011 focused on the following aspects of PAC: a) objectives; b) estimations of the need and the indicators for access to it, and c) transfer strategies from acute care to PAC. The results of this review indicate that PAC is an efficient approach to improve patients' quality of life and to sustain the public healthcare system. The choice of candidates for PAC should be based on both health and social indicators, and the overall process viewed in a cross-sectional manner in order to avoid increases in total cost.

Strategic interaction among hospitals and nursing facilities: the efficiency effects of payment systems and vertical integration.

Rising post-acute care expenditures for Medicare transfer patients and increasing vertical integration between hospitals and nursing facilities raise questions about the links between payment system structure, the incentive for vertical integration and the impact on efficiency. In the United States, policy-makers are responding to these concerns by initiating prospective payments to nursing facilities, and are exploring the bundling of payments to hospitals. This paper develops a static profit-maximization model of the strategic interaction between the transferring hospital and a receiving nursing facility. This model suggests that the post-1984 system of prospective payment for hospital care, coupled with nursing facility payments that reimburse for services performed, induces inefficient under-provision of hospital services and encourages vertical integration. It further indicates that the extension of prospective payment to nursing facilities will not eliminate the incentive to vertically integrate, and will not result in efficient production unless such integration takes place. Bundling prospective payments for hospitals and nursing facilities will neither remove the incentive for vertical integration nor induce production efficiency without such vertical integration. However, bundled payment will induce efficient production, with or without vertical integration, if nursing facilities are reimbursed for services performed.

Provisions of the Balanced Budget Act challenge IDS care coordination patterns.

Provisions of the Balanced Budget Act of 1997 that focus on postacute services have important ramifications for integrated delivery systems (IDSs) because changes in payment rates for such services create financial incentives to alter patient-flow patterns among acute and postacute care services. In particular, IDSs should understand the provisions of the act that deal with a prospective payment system for skilled nursing services, the definition of a transfer from an acute care hospital, interim and prospective payment systems for home health care, limits imposed by the 1982 Tax Equity and Fiscal Responsibility Act for acute rehabilitation providers, a PPS for acute rehabilitation providers, TEFRA limits for long-term acute care, and limits on outpatient therapy services.

How IDSs can turn BBA postacute care provisions to their advantage.

Reductions in payments imposed by the Balanced Budget Act of 1997 may force postacute care providers to impose limits on the number and acuity of patients they can accept. As a result, integrated delivery systems may face reduced access to postacute care. An integrated delivery system's financial well-being may be undermined if its only alternative is to care for postacute care patients in high-cost, acute care settings. To address this problem, IDSs should analyze the financial impact of the Balanced Budget Act and share results throughout their systems, determine how financial incentives affect postacute care utilization, conduct interviews to garner support for strategic objectives, evaluate current operational policies and procedures to determine whether they meet Balanced Budget Act requirements, assess their demand for postacute care services, and develop strategies that fairly distribute the impact of changes among all constituencies.