Scott Rifkin: Like It or Not, Hospitals Will Change the SNF Industry

Hospitals and skilled nursing facilities (SNFs) see the world differently. And neither embraces change easily. However, as the Center for Medicare and Medicaid Services (CMS) continues to aggressively push change at the hospital level – and there will be no possibility of avoiding the downstream effect of the pressures that SNFs will face.

For several years CMS has been pushing hospitals to take more responsibility for the total cost of care, introducing value-based healthcare programs and readmission penalties which are intended to do just that. The larger and savvier hospitals are embracing this change swiftly and forming well-funded operations to take risk, manage care, and reach out into the post-acute space. They are not, for the most part, repeating their mistakes of the past by trying to acquire and operate SNFs, but instead are trying to figure out how to get the post-acute providers to align with their objectives.

SNFs inherently want longer Medicare lengths of stay as re-hospitalizations and the three-day rule lead to higher SNF revenue. However, this is the polar opposite of what hospitals are trying to achieve under CMS’ new goals. In the current slow-motion crash of the two industries, hospitals will win. After all, good care, lower cost, and the 800-pound gorilla (CMS) are on the hospital side.

Hospitals control the gateway for patients. They have always wanted patients to go to the best quality providers but until recently have been ineffective in achieving that goal. Poor data sources (MDS based year-old data) and often inaccurate billing-based data have hampered the hospital systems. SNF operators have often used the outdated data to make the excuse, “our performance is below par because we take sicker patients,” and hospitals have lacked the quality data needed to push back.

The push for value-based programs and readmission penalties have upped the pressure on hospitals to accurately ascertain the relative performance of their post-acute providers. Many systems are creating post-acute networks or preferred networks as a tool to understand and gather data, create working relationships with partners, and to feature good performers. Certainly, patients deserve to be informed which post-acute provider has better outcomes.

The new urgency of hospitals will lead to narrower and narrower networks over time. Good performers will be rewarded, and bad ones will see negative impacts. This doesn’t mean that a health system has to exclude providers, although some may choose to do so. Many may simply choose to make outcome data available to patients, discharge planners, and case managers. This data can be powerful. What patient will choose the facility with poor performance records over the one with excellent results?

The key to the future is better data. The day of old MDS derived data is rapidly disappearing, as there are companies who can deliver outcome data in real time to health systems. Easily accessed data, sourced directly from the SNF electronic health record (EHR) is powerful. It allows a hospital to see data including re-admissions, admissions for long-term care (LTC) patients, length of stay, relative acuity, and even interventional moments in the SNF. This data can be sorted by time period, diagnoses, insurer, and even doctor. They can compare all their facilities by all these parameters and do so with data just moments old.

Hospitals now have the ability to identify high risk patients in the SNFs and work collaboratively with them to avoid readmissions. And in some cases, they may know a patient is at risk before the SNF Director of Nursing knows! One Pennsylvania-based health system reduced readmissions from 18% to 8.5% from their SNFs by working with Real Time Medical System’s ProACT HS application and two re-purposed internal case managers. Using live data derived by the Real Time solution, these case managers were easily able to identify high risk patients at the SNFs and offer hospital resources, as well as subtly encourage the SNFs to be focused on these patients. A large academic medical center on the east coast also utilized Real Time’s ProACT HS application and dropped readmissions from 28% to 17% – with a total cost saving of nearly $4M in one year.

The lessons from all of this are twofold. First, health systems and hospitals need to access newly available EHR-based data quickly and efficiently. Turn-key solutions to accessing this data, such as Real Time’s ProACT HS application, allows the hospital to monitor the progression of their patients while at a SNF. Requiring no involvement with the hospital’s IT department, this solution can be up and live within 60 days. This new data will give the hospitals tremendous ability to understand and intervene with patient care that they have never had before – case management and network activities will be vastly improved. The difference between old data for “predictive analytics” versus fresh data for “interventional analytics” is a game changer within the healthcare industry.

Second, SNFs need to truly understand that the healthcare world has changed. Health systems and hospitals will expect more. Relationship marketing will give way to outcomes marketing. – Who will be the best provider? Smart SNFs will gather immediate data to show how they are effective or identify and fix problems, leading to increased hospital referrals. The natural market forces will move patients from poor providers to excellent providers. The facilities that understand this will see increased Medicare patients and become the winners. Those that don’t will lose market share and will lose the war.

Win or lose, the game has changed. The question is, what you doing to prepare for it?

About Real Time Medical Systems

Real Time Medical Systems is the leading healthcare interventional analytics company helping to improve the patient care continuum by connecting long-term care facilities, hospitals, ACOs, payers, and affiliated providers in building an integrated preferred care network.

Empowering a proactive approach to patient centered care, Real Time’s interventional analytics platform was developed for skilled nursing facilities to easily identify patients who had a change in care condition and intervene immediately before re-hospitalization occurred – helping to improve clinical and financial performance while reducing readmission rates by 50%. Since launching their interventional analytics platform in 2012, Real Time has expanded their solution offering to include fully-integrated applications which allow hospitals, ACOs, payers, and affiliated providers to connect and collaborate with their post-acute care networks.

Operating in 700+ facilities, throughout 30+ states, and monitoring nearly 100,000 lives – Real Time continues to ensure patient-centered care is at the forefront for its clients. For more information or to request a demo of the Real Time ProACT HS application, contact Tommy Pfeiffer, Director of Health System Solutions at [email protected]