Today’s Healthcare Delivery System: How Post-Acute Providers Must Evolve to Succeed Under New Payment Models

Post-acute care providers such as home health agencies and skilled nursing facilities are operating in much different healthcare environments than they have in the past. There are more regulations and paperwork involved in meeting the bare minimum of participating in Medicare and Medicaid programs, which increases the cost of doing business. At the same time, per patient reimbursement levels are going down. Success is no longer defined solely by volume, as quality measurement has introduced itself to the world of post-acute care, which is something that hospitals and health systems have been adjusting to over the last several years.

In post-acute care, value-based measurement presents itself from two angles. First, the Centers for Medicare and Medicaid Services are showing their commitment to quality across the care continuum by incorporating utilization, patient experience, and outcomes into Home Health Value-Based Purchasing and Skilled Nursing Facility Value-Based Purchasing programs. On top of that, post-acute care providers are evaluated by their hospital and physician group referral sources – where it’s not uncommon to have people in place to manage and monitor their ever-narrowing network of post-acute care providers.

To be successful in this world, skilled nursing facilities and home health agencies must not only hit these measures, but do new and innovative things to stand out to their referral sources. There are many approaches to this, but it takes a certain level of comfort with deviation from the norm.

For example, according to LeadingAge, the average length of stay for Medicare beneficiaries is 26.78 days. Skilled nursing facilities should show that their short-term beds can operate as a ‘step down’ from hospital-level care by successfully servicing a higher-acuity patient with a lower overall length-of-stay. Home health agencies may look to diversify their service offerings and revenue streams, such as getting involved in ‘prehab’ activities for elective admissions or Chronic Care Management (CCM) billing support for physician group partners. Post-acute care providers should seek these partnerships and a seat the table outside of traditional episode-based referral arrangements, and be comfortable with risk/reward sharing agreements such as accountable care organizations and bundled payment programs.

Picking the right partner is not the only recipe for success in this new era. Providers should figure out how to improve their operating margins and do more with less, while simultaneously improving patient care. Investing in the right technology today can enable post-acute care providers to operate smarter and leaner. However, a technology vendor alone is not enough. It is critical to find the right technology partners who work alongside your organization to truly understand, act upon data, and create value. My advice for home health agencies and skilled nursing facilities would be to turn to your acute partners to see what has worked and what hasn’t in their journey to value-based care.

Value-based care isn’t going anywhere, and post-acute providers need to hop on the train before it leaves the station. For the home health agencies and skilled nursing facilities that figure this out, there is real opportunity. For those that struggle with change, there is rough and likely short road ahead.

Learn more about how CipherHealth can empower your skilled nursing facility or home health agency to lead the future of healthcare delivery.

John Banks Powell, VP of Post-Acute Strategies, obtained his Bachelor’s from UNC-Chapel Hill and his Master’s from Duke University. Powell spearheads CipherHealth's post-acute and bundled payment initiatives by partnering with providers across the care continuum. When Powell isn’t helping post-acute providers reach organizational goals, he can be found 30,000 feet in the air piloting planes.

CipherHealth empowers providers across the care continuum to deliver enhanced patient experiences and communications through a modular, comprehensive patient engagement technology platform.