Unintended Consequences of Measures to Reduce

Readmissions and Reform Payment—Threats to

Vulnerable Older Adultsby

Mary D. Naylor, Ellen T. Kurtzman, David C. Grabowski, Charlene Harrington, Mark B. McClellan & Susan C.

Reinhard

Engelberg Center for Health Care ReformBrookings Institution

Mission:

• Work with a broad range of stakeholders to develop data-driven, practical policy solutions that promote broad access to high-quality, affordable, and innovative care in the United States.

– Conduct research and evaluations

– Make policy recommendations

– Provide technical support and

– Facilitate the development of consensus around evidence-based health care solutions.

2

Engelberg Center for Health Care ReformBrookings Institution

Projects and partnerships supporting comprehensive health care reform:

• Financing + delivery reforms – Accountable Care Organization (ACO) Learning Network, Academic

Medical Centers, Beacon Communities, Bundled Payments, Value-Based Insurance Design

• Implementing quality and cost measures to support higher value care– Quality Alliance Steering Committee (QASC), Performance

Measurement Implementation, Long Term Quality Alliance (LTQA) focusing across acute, PAC, and LTC parts of the system

• Biomedical innovation and personalized care• Guiding the health care reform debate

– Bending the curve

3

Long Term Services and Supports (LTSS)

» Defined as assistance with ADLs or IADLs» Growing population of frail, older people require LTSS

10-11 million community-based residents, half of whom are older adults

1.8 million nursing home residents, most of whom are older adults

» Recipients of LTSS experience frequent changes in health and multiple transitions

» Represent disproportionate share of spending—15% of Medicare beneficiaries have both chronic illnesses and LTSS needs but account for 30% of spending

» Much of this spending and associated care may be avoidable (e.g., repeat hospitalizations for uncontrolled conditions)

Impact of Transitions on Older Adults Receiving LTSS

5

Poor health outcomes—accelerated cognitive and physical functional declineHigher rates of iatrogenic events such as hospital-acquired conditions, medical errorsUnmet needs, lower patient satisfaction, higher caregiver burdenExcessive and often avoidable use of costly health services such as emergency department (ED) visits and hospitalizations

Evidence of Effective Transitional Care

» 21 RCTs of 587 diverse “hospital to home” innovations targeting chronically ill older adults

» 9 of 21 had positive impact on at least one measure of rehospitalization plus other health outcomes

» Multicomponent interventions that address gaps in care, promote effective hand-offs/root causes of poor outcomes

» Reliance on in-person home visits, patient self-management, connecting acute and primary care

» Nurses as “hubs”—clinical managers or leaders » Interventions averaged 9+ weeks

Naylor, Aiken, Kurtzman, Olds, & Hirschman. Health Affairs. 2011; 30(4):746-754.

State of Reform» New ACA policies and programs illustrate

opportunities to enhance transitional care among Medicare population

» Potential for older adult population receiving LTSS to benefitHospital Readmissions Reduction Program

(Section 3025)National Pilot Program on Payment Bundling

(Section 3023)Community-Based Care Transitions Program

(Section 3026)

ACA’s Impact on Transitions Among

Older Adults Receiving LTSS

8

9

» Beginning October 2012, hospitals with excessive, severity-adjusted rehospitalization rates (30 day) will be financially penalized

» Initially limited to three target conditions—pneumonia, HF, and AMI—with expansion to other conditions in 2015

» Within 2 years of law’s enactment, quality improvement support will be provided to hospitals through Patient Safety Organizations (PSOs)

» Should motivate behaviors that reduce preventable rehospitalizations and improve outcomes for all beneficiaries, including frail elders receiving LTSS

Hospital Readmissions Reduction Program

10

» Common reasons for hospitalization among older adults receiving LTSS do not fully synch with those targeted by the law

» Restriction of PSO quality improvement opportunities to hospitals

» Coordination between acute care and LTSS providers not guaranteed

» Preventing rehospitalizations is known to be costly» Losses from penalties may not be offset by income

that would be generated from rehospitalizations» Penalty cap could incentive providers to bear the

penalty rather than assume costs for prevention » Use of coding to avoid measurement of some

rehospitalizations (e.g., observation stays)

Hospital Readmissions Reductions—Barriers

11

» Five year pilot program established by January 2013 to evaluate an episode-based, integrated care delivery and payment program

» Structured around an acute care hospitalization» Longest “episode” covered—three days before

hospital admission and through 30 or 90 days post-hospital discharge

» Bundled payment pays for inpatient, physician, outpatient, and postacute care

» Should reduce costs and improve quality—incentives will exist to deliver care in the lowest-cost setting, maximize operating margins, and avoid expensive postacute stays and preventable rehospitalizations

National Pilot Program on Payment Bundling

12

» Pilot excludes LTSS as part of the “bundle”» Little incentive exists to coordinate care before or

beyond the episode» Fails to create the type of integration among acute,

postacute, and primary care and community- and institutionally based LTSS

» Hospitals likely to limit referral networks which may incentivize nursing homes to specialize in postacute care rather than LTSS

» May incentivize withholding or denying care and shifting costs to the postbundle period

Hospital Readmissions Reductions—Barriers

13

» $500 million available to community-based organizations (CBOs) + one or more hospitals with high readmission rates to provide transitional care services

» Implementation of evidence-based care transition services (e.g., timely post-discharge follow up, self-management support, comprehensive medication review and management)

» Target high risk Medicare beneficiaries—those who have been diagnosed with multiple chronic conditions or possess other factors, such as cognitive impairment, depression, or a history of multiple readmissions, that others place them at risk

Community-Based Care Transitions (CCTP)

14

» Hospitals as “hub” of care transitions—some frail older adults receiving LTSS are likely to be “missed” if they are not hospitalized and/or live outside geographic region

» Patients may lack the required physical, mental, functional disabilities or other determinants for eligibility

» Medicare-only benefit without any specific mandate to align, integrate, or coordinate with Medicaid or private insurers

Community-Based Care Transitions—Barriers

Policy Recommendations

15

16

Going Beyond the Affordable Care Act

» Anticipate unintended consequences Identify negative effects through warning signs Longitudinally monitor consequences Enhance existing performance measures and

available data » Advance payment policies that integrate care

Reform needs to incorporate LTSS Shorter-term, immediate pathways that build on

existing programs (e.g., extend readmissions penalties to LTSS)

» Promote needed delivery system reforms Support for providers in their implementation of

these provisions

17

Reforming the Delivery System» Bring together Acute, Post-Acute and Long Term Care

Communities to implement health care reforms that improve health and lower costs, particularly for patients with complex needs, including new support for:

Providers Consumers Payers Purchasers

» Examples: Aligned provider payment and benefit design reforms for Accountable Care Organizations, Medical Homes, Episode Payments

» Major upcoming focus of Brookings reform efforts» LTQA can facilitate educational and other reform

initiatives that advance developing comprehensive reforms

18

Conclusion

Selected provisions of the Affordable Care Act inadequately

address the unique needs of older adults receiving LTSS and

may introduce unintended consequences. Policy action is

needed to address these potential emerging risks.

19

To Become InvolvedContact

• Dr. Barbara Gage at the Brookings Institution: bgage@brookings.edu

Or • Mr. Doug Pace at the LTQA:

Dpace@LeadingAge.org