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What Have We Learned from the First Years of Health Care Reform?

Posted on: May 23, 2016

We can learn important lessons from post-acute care operators who have already made strategic operational and clinical changes in response to health care reform mandates. In many cases, these forward-thinking skilled nursing and rehab communities have been engaged on this path for several months/years, offering the industry a unique opportunity to ask the question: “What have we learned from the first years of health care reform?”

As the industry focuses on the Triple Aim model, there is a recognizable shift in how this “New World Order” is taking shape. For example, HealthPRO®/Heritage considers the following trend significant:

Historically: 52% of ACOs in MSSP did not keep costs below benchmarks in the first performance year.
Today: 1 in 10 Medicare FFS beneficiaries are attributed to an ACO
By 2018: 50% of all payments will be via VBP program; 90% of FFS MCA $ linked to quality or value*

*Source: CMS BPCI Initiative Models 2-4: year 1 Evaluation and Monitoring Annual Report, The Lewin Group, February 2015

It is also interesting to note that within the first CMS evaluation of bundled payment initiatives, there was a 30% reduction in patients admitted to post-acute care setting following orthopedic surgeries. Likewise, in a recent letter to Journal of the American Medical Association (JAMA), New York University’s Model 2 bundled payment program demonstrated a 49% reduction in discharges to PAC providers for cardiac valve replacement surgeries and a 34% reduction for joint replacement surgeries.

Based on these preliminary reports, HealthPRO®/Heritage expects that not only will CMS continue to drive cost-reduction strategies and value-based pricing, but the commercial insurance/managed care industry will also continue to follow suit. As such, hospitals are very motivated to establish preferred partners networks who will help them achieve the following incentives:

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Tags: Heritage Healthcare, HealthPRO Rehabilitation, Health care reform, Advisor Newsletter, Advisor