Does One Size Fit All With the Effects of Payment Reform? Dialysis Facility Payer Mix and Anemia Management Under the Expanded Medicare Prospective Payment System.

BACKGROUND: The effects of Medicare payment reforms aiming to improve the efficiency and quality of care by establishing greater financial accountability for providers may vary based on the extent and types of other coverage for their patient populations. Providers who are more resource constrained due to a less favorable payer mix face greater financial risks under such reforms. The impact of the expanded Medicare dialysis prospective payment system (PPS) on quality of care in independent dialysis facilities may vary based on the extent of higher payments from private insurers available for managing increased risks. OBJECTIVES: To evaluate whether anemia outcomes for dialysis patients in independent facilities differ under the Medicare PPS based on facility payer mix. DESIGN: We examined changes in anemia outcomes for 122,641 Medicare dialysis patients in 921 independent facilities during 2009-2014 among facilities with differing levels of employer insurance (EI). We performed similar analyses of facilities affiliated with large dialysis organizations, whose practices were not expected to change based on facility-specific payer mix. RESULTS: Among independent facilities, similar modeled trends in low hemoglobin for all 3 facility EI groups in 2009-2010 were followed by increased low hemoglobin during 2012-2014 for facilities with lower EI (P<0.01). Post-PPS standardized blood transfusion ratios were 9% higher for lower EI versus higher EI independent facilities (P<0.01). Among large dialysis organizations facilities, there was no divergence in low hemoglobin by payer mix under the PPS. CONCLUSIONS: There is evidence of poorer quality of care for anemia under the PPS in independent facilities with lower versus higher EI. Provider responses to payment reform may vary based on attributes such as payer mix that could have implications for health disparities.

Primary Care Pharmacist Services Align With Payment Reform and Provider "Joy of Practice".

The implementation and expansion of primary care (PC) pharmacist medication optimization and management services has been hindered mainly by the lack of a payment mechanism for PC providers to engage pharmacist services. If pharmacists expect to be included in new PC team-based payment models, we need to actively engage in ongoing PC practice transformation discussions with PC organizational leaders. In this commentary, examples of integrated PC pharmacist services and payment models are provided to (1) reinforce the feasibility of pharmacist integration into expanded PC teams and (2) share with PC leaders, payers, and policy makers.

An unintended consequence of provider payment reform: The case of capitation grants in the National Health Insurance reform of Indonesia.

One of the most important components of the ambitious 2014 National Health Insurance reform in Indonesia is the implementation of prospective payment system known as capitation grants, paid monthly to the primary health providers based on the enrolment rate. This has ushered in additional financial resources for the health managers in resource allocations, especially in the hiring of manpower. Drawing data from the Indonesia Family Life Survey (1993-2015), this paper uses difference-in-differences method to evaluate the effects of the payment method reform on the allocation of human resources for health among the primary health providers. To our surprise, there was no statistically significant change in the total number of full-time staff among the capitated facilities after the reform. However, capitation grants caused an increase in the number of full-time equivalent and part-time equivalent contract staff, but a significant decline in the number of full-time permanent staff among the urban capitated facilities. It is likely that more contract health workers were hired at the expense of full-time permanent staff among the capitated facilities in the urban regions. This unintended consequence shed light on the need to develop nuanced and contextual understanding of payment reforms in developing countries.

How do Hospitals Respond to Price Changes? Evidence from Norway.

Many publicly funded health systems use activity-based financing to increase hospital production and efficiency. The aim of this study is to investigate whether price changes for different treatments affect the number of patients treated and the mix of activity provided by hospitals. We exploit the variations in prices created by the changes in the national average treatment cost per diagnosis-related group (DRG) offered to Norwegian hospitals over a period of 5 years (2003-2007). We use the data from Norwegian Patient Register, containing individual-level information on age, gender, type of treatment, diagnosis, number of co-morbidities and the national average treatment costs per DRG. We employ fixed-effect models to examine the changes in the number of patients treated within the DRGs over time. The results suggest that a 10% increase in price leads to about 0.8-1.3% increase in the number of patients treated for DRGs, which are medical (for both emergency and elective patients). In contrast, we find no price effect for DRGs that are surgical (for both emergency and elective patients). Moreover, we find evidence of upcoding. A 10% increase in the ratio of prices between patients with and without complications increases the proportion of patients coded with complications by 0.3-0.4 percentage points.

The Impact of Hospital Payment Schemes on Healthcare and Mortality: Evidence from Hospital Payment Reforms in OECD Countries.

In this study, aggregate-level panel data from 20 Organization for Economic Cooperation and Development countries over three decades (1980-2009) were used to investigate the impact of hospital payment reforms on healthcare output and mortality. Hospital payment schemes were classified as fixed-budget (i.e. not directly based on activities), fee-for-service (FFS) or patient-based payment (PBP) schemes. The data were analysed using a difference-in-difference model that allows for a structural change in outcomes due to payment reform. The results suggest that FFS schemes increase the growth rate of healthcare output, whereas PBP schemes positively affect life expectancy at age 65 years. However, these results should be interpreted with caution, as results are sensitive to model specification. Copyright © 2015 John Wiley & Sons, Ltd.

Medicare bundled payment: what is it worth to you?

Hospital leaders who are contemplating participation in a bundled payment initiative should first assess current circumstances to determine the extent of the opportunity for their organizations. Those who have decided conditions are favorable for such an initiative should next perform a financial assessment that includes modeling direct contract results, assessing the financial impact of reduced utilization and of improved clinical care and operations, and evaluating the net financial impact. Hospital executives also should understand the competitive and strategic benefits that bundled payment offers.

Definition of a prospective payment system to reimburse emergency departments.

BACKGROUND: Payers are increasingly turning to Prospective Payment Systems (PPSs) because they incentivize efficiency, but their application to emergency departments (EDs) is difficult because of the high level of uncertainty and variability in the cost of treating each patient.To the best of our knowledge, our work represents the first attempt at defining a PPS for this part of hospital activity. METHODS: Data were specifically collected for this study and relate to 1011 patients who were triaged at an ED of a major Italian hospital, during 1 week in December 2010.The cost for each patient was analytically estimated by adding up several components: 1) physician and other staff costs that were imputed on the basis of the time each physician claimed to have spent treating the patient; 2) the cost for each test/treatment each patient actually underwent; 3) overhead costs, shared among patients using the time elapsed between first examination and discharge from the ED. RESULTS: The distribution of costs by triage code shows that, although the average cost increases across the four triage groups, the variance within each code is quite high. The maximum cost for a yellow code is €1074.7, compared with €680 for red, the most serious code. Using cluster analysis, the red code cluster is enveloped by yellow, and their costs are therefore indistinguishable, while green codes span all cost groups. This suggests that triage code alone is not a good proxy for the patient cost, and that other cost drivers need to be included. CONCLUSIONS: Crude triage codes cannot be used to define PPSs because they are not sufficiently correlated with costs and are characterized by large variances. However, if combined with other information, such as the number of laboratory and non-laboratory tests/examinations, it is possible to define cost groups that are sufficiently homogeneous to be reimbursed prospectively. This should discourage strategic behavior and allow the ED to break even or create profits, which can be reinvested to improve services. The study provides health policy administrators with a new and feasible tool to implement prospective payment for EDs, and improve planning and cost control.

Determining the optimal model for role-substitution in NHS dental services in the United Kingdom.

BACKGROUND: Role-substitution describes a model of dental care where Dental Care Professionals (DCPs) provide some of the clinical activity previously undertaken by General Dental Practitioners. This has the potential to increase technical efficiency, the capacity to care and reduce costs. Technical efficiency is defined as the production of the maximum amount of output from a given amount of input so that the service operates at the production frontier i.e. optimal level of productivity. Academic research into technical efficiency is becoming increasingly utilised in health care, although no studies have investigated the efficiency of NHS dentistry or role-substitution in high-street dental practices. The aim of this study is to examine the barriers and enablers that exist for role-substitution in general dental practices in the NHS and to determine the most technically efficient model for role-substitution. METHODS/DESIGN: A screening questionnaire will be sent to DCPs to determine the type and location of role-substitutive models employed in NHS dental practices in the United Kingdom (UK). Semi-structured interviews will then be conducted with practice owners, DCPs and patients at selected sites identified by the questionnaire. Detail will be recorded about the organisational structure of the dental team, the number of NHS hours worked and the clinical activity undertaken. The interviews will continue until saturation and will record the views and attitudes of the members of the dental team. Final numbers of interviews will be determined by saturation.The second work-stream will examine the technical efficiency of the selected practices using Data Envelopment Analysis and Stochastic Frontier Modeling. The former is a non-parametric technique and is considered to be a highly flexible approach for applied health applications. The latter is parametric and is based on frontier regression models that estimate a conventional cost function. DISCUSSION: Maximising health for a given level and mix of resources is an ethical imperative for health service planners. This study will determine the technical efficiency of role-substitution and so address one of the key recommendations of the Independent Review of NHS dentistry in England.

Confusion ahead as CMS changes inpatient criteria.

In the Inpatient Prospective Payment System final rule for 2014, the Centers for Medicare & Medicaid Services established a benchmark of two midnights for an inpatient admission and issued robust requirements for documentation. Case managers must work closely with physicians to ensure that the documentation includes the expected length of stay, the rationale for hospital treatment, the treatment plan, and a written order for admission. Case managers must review every admission within 24 hours to make sure the hospital doesn't lose reimbursement. Auditors will be looking for incidents where hospitals keep patients over two midnights when it's not medically necessary in order to get inpatient reimbursement. CMS continues to emphasize quality in care.

Change in inpatient rehabilitation admissions for individuals with traumatic brain injury after implementation of the Medicare inpatient rehabilitation facility prospective payment system.

OBJECTIVE: To evaluate the impact of Medicare's inpatient rehabilitation facility (IRF) prospective payment system (PPS) on use of inpatient rehabilitation for individuals with traumatic brain injury (TBI). DESIGN: Retrospective cohort study of patients with TBI. SETTING: One hundred twenty-three level I and II trauma centers across the U.S. who contributed data to the National Trauma Data Bank. PARTICIPANTS: Patients (N=135,842) with TBI and an Abbreviated Injury Score of the head of 2 or greater admitted to trauma centers between 1995 and 2004. INTERVENTIONS: None. MAIN OUTCOME MEASURE: Discharge location: IRF, skilled nursing facility, home, and other hospitals. RESULTS: Compared with inpatient rehabilitation admissions before IRF PPS came into effect, demographic characteristics of admitted patients changed. Those admitted to acute care trauma centers after PPS was enacted (January 2002) were older and nonwhite. No differences were found in rates of injury between men and women. Over time, there was a significant drop in the percent of patients being discharged to inpatient rehabilitation, which varied by region, but was found across all insurance types. In a logistic regression, after controlling for patient characteristics (age, sex, race), injury characteristics (cause, severity), insurance type, and facility, the odds of being discharged to an IRF after a TBI decreased 16% after Medicare's IRF PPS system was enacted. CONCLUSIONS: The enactment of the Medicare PPS appears to be associated with a reduction in the chance that patients receive inpatient rehabilitation treatment after a TBI. The impact of these changes on the cost, quality of care, and patient outcome is unknown and should be addressed in future studies.