April 29, 2019, Alex Spanko, Skilled Nursing News - For many skilled nursing providers, the launch last week of the 2020 application period for the government’s flagship bundled-payment program was low on the list of priorities. After all, under the new Bundled Payments for Care Improvement Advanced (BPCI Advanced) model, nursing homes can’t be episode initiators, meaning hospitals and other acute-care providers are the ones in the driver’s seat.
And with bundled payments and other new models frequently saving the most money by cutting skilled nursing usage, the news was liable to get lost in the other headlines from the federal government last week — including an $887 million pay bump for nursing homes and a major push toward overhauling coverage of dual-eligible seniors.
But several industry leaders emphasized the opportunity for SNFs under BPCI Advanced, laying out a path for participation even if hospitals ultimately control the shots for the application process.
“This is an opportunity,” Anne Tumlinson, founder and CEO of consulting firm Anne Tumlinson Innovations, said. “There’s nothing to prevent them from being a convener.”
Speaking to Skilled Nursing News about the potential for SNFs under bundled payments, Tumlinson drew a direct comparison to a far trendier move in the nursing home space over the last few years — the creation of in-house Medicare Advantage plans, or Institutional Special Needs Plans (I-SNPs).
“If you’re thinking about being an I-SNP, why aren’t you thinking about being a bundled payment convener?” she said. “It’s kind of the same — same capabilities, same objective and goal, which is to move farther up the food chain.”
In general, bundled payment structures seek to reduce overall Medicare spending by furnishing a single episodic reimbursement for certain conditions. Under this system, the theory goes, providers up and down the care continuum will be encouraged to save money and improve outcomes wherever possible, as any cost overruns will cut into their bottom lines — and, if spending far exceeds the single episodic payment, result in losses.
The new BPCI Advanced model allows only hospitals and physician groups to apply for the program, and they alone can initiate the 90-day episode of care for beneficiaries. But as a so-called convener, skilled nursing facilities can share in the potential savings by accepting all or some of the downside risk — a potentially attractive offer for more conservative hospital operators.
“Some hospitals don’t really want to take risk,” Tumlinson said. “They just want to share in some savings from working in a clinically integrated model with you.”
And the potential for operators doesn’t stop at applying for being a convener.
“Additionally, by being listed on a BPCI Advanced Participant’s Financial Arrangements List, SNFs are eligible to share in gains earned in the program,” Keely Macmillan, general manager of BPCI Advanced efforts at consulting firm and convener Archway Health, told SNN. “Qualified SNFs can also utilize the three-day skilled nursing facility rule Payment Policy Waiver in partnership with BPCI Advanced participants.”
As with all new payment models, integrating a skilled nursing facility into a BPCI Advanced network takes hard data and firm, unassailable proof of the value that SNFs can provide to episode initiators. In Tumlinson’s view, that means being frank with hospital leaders about how acute-care weaknesses are often a SNF’s strengths.
“We’re going to take on all the risk as the convening entity,” Tumlinson said as an example of a pitch to hospitals. “We have all of the capabilities. You don’t know how to manage post-acute care. We do. We’re going to set this up in a way that if it works well, you’ll have the opportunity to share in some of the savings.”
Mary Coppage, vice president of consulting at Anne Tumlinson Innovations, broke down the SNF strategy into three parts.
“Becoming a SNF convener is challenging,” she said. “It takes the right SNF, in the right market, with the right hospital — episode initiator — partner.”
First, a smart operator needs to identify the opportunity it can offer a hospital or physician group. For some, that could be a proven ability to reduce hospital readmissions, or a strong track record of caring for residents with specific episodic conditions.
Next, leadership at the SNF should approach hospitals in their marketplace — preferably ones with which they already have a solid working relationship. In particular, Coppage suggested presenting solid data on outcomes along with a variety of potential risk-sharing options for the hospital team to consider.
Finally, before inking any deal to participate in BPCI Advanced, providers should take a hard look inward to ensure that their systems and staff are up to the task.
“Being a convener takes a lot of work. The SNF will need to have executive commitment and comfort with managing risk,” Coppage said. “The SNF will also need the ability to analyze data, develop and implement clinical protocols and care redesign, and an overall ability to handle the new workload.”
Though it seems like a heavy lift, and though BPCI Advanced remains an optional model, Tumlinson stressed that the program represents yet another step in the Centers for Medicare & Medicaid Services’ (CMS) inevitable march toward demanding more risk from hospitals and their post-acute partners. Just last week, for instance, CMS administrator Seema Verma hinted at the development of future mandatory shared-savings programs in a speech to the National Association of Accountable Care Organizations (NAACOS).
“Looking forward, you can expect that some of the models we have under development will be mandatory,” Verma said in her prepared remarks, adding that compelling providers to participate will help the government collect more accurate data and reduce selection bias.
So for hospitals and SNFs alike, taking a proactive stance on BPCI Advanced and other payment models could set them up for success no matter what CMS might cook up next.
“You’re going to have to do this eventually, anyway,” Tumlinson said of hospitals. “You’re going to have to get better at this, because one way or the other, CMS [is] pushing all of these risk models hard, and eventually you’re not going to be able to succeed under Medicare unless you get a handle on the post-acute care delivery model.“