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Doctors and nurses sitting around a table discussing how to reduce rehospitalization with the Skilled Nursing VBP program

Reducing Rehospitalization With the SNF VBP Program

Over the past decade, multiple studies have raised concerns about the quality of care in skilled nursing facilities (SNF). Various demonstration programs have been ongoing for many years and, prior to that, models were being evaluated under pay-for-performance initiatives that began in the mid-2000s. However, there was still a disconnect between payment and quality of care, driving the need for a value-based program.

The basis for the SNF Value-Based Purchasing (SNF VBP) Program is included within the Protecting Access to Medicare Act of 2014 and establishes a hospital readmissions reduction program where SNFs are encouraged to address potentially avoidable rehospitalizations by creating an incentive pool for high performers.

One key strategy is to link health care spending to quality and efficiency through the value-based program with the primary goal to put people first. Under this model, performance standards for SNFs are established based on the 30-day All-Cause Readmission Measure in addition to levels of achievement and improvement.

Data is available from key sources including confidential quarterly reporting and public reporting. Medicare SNF providers are reimbursed for post-acute admission under the Prospective Payment System Resource Utilization Group (PPS RUG) model for inpatient Medicare Part A, which is standard to the geographic area, regardless of patient outcomes or high quality of care ratings currently.

What to Expect
The first SNF VBP Program results were released October 1 of last year. SNF Medicare reimbursement will be reduced by 2% to fund the payment incentive pool. CMS will redistribute the incentive payment back to providers based on ranking. Scores range from 0-100 points, and the value assigned is for both improvement and achievement. For providers to get the incentive payment, a calculation methodology of scoring and exchange function model is used to determine the incentive multiplier, as well as the total amount of the incentive payment.

A provider’s ability to manage and provide proper care to high-risk patients contributes to their overall ranking. If a patient is rehospitalized within the 30 days following discharge, the provider’s ranking will suffer. Therefore, providers with higher rankings receive higher incentive payments and those with lower ranking receive a lower amount or perhaps zero incentive payment.

Based on the recent Final Rule, CMS will retain a portion of the payment reduction as a savings to the Medicare program, while 60% of the 2% payment reduction will be paid back to providers as their incentive. As CMS continues to move towards paying providers for services based on the quality of care, not just quantity of services delivered, it’s essential for facilities to know how they’re trending and put plans in place to improve their score.

By tracking quality metrics to understand their performance and improving performance through the implementation of quality programs (i.e. INTERACT), providers will have the information and tools they need to reduce rehospitalization rates in their facility – helping to secure reimbursement payments.

Learn more about INTERACT and how to integrate the process with your electronic health record.

January 26, 2018