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Questions & Answers for Cash Flow Solutions

Q&A with Hilary Forman, Chief Clinical Strategies Officer at HealthPRO Heritage identifies opportunities to improve cash flow (and outcomes!) amidst the turmoil of the PDPM transition and COVID-19.

The unique dynamics of PDPM – coupled with the crisis response to COVID-19 – have created a Perfect Storm of worry about cash flow challenges. Based on her perspective as a consultant on healthcare redesign and clinical reimbursement and also a therapy provider, Hilary offers strategic insights into opportunities that exist for SNFs to leverage cash flow advantages, balance expenses, and improve the overall bottom line impact of PDPM and COVID-19.

Q: What interesting trends have been identified since PDPM - and in light of COVID-19 - that can inform a go-forward approach for SNFs looking to optimize cash flow?

A: Interestingly, SNFs who were well-prepared for PDPM and became adept at admitting, documenting and capturing optimal codes for more complex populations are also generally better at managing the challenges presented by COVID-19.  Alternatively, facilities that had not yet adopted strategies and best practices that drive clinical outcomes and reimbursement under PDPM are the ones struggling with exacerbated cash flow issues that have really come to light during the COVID-19 crisis. These providers may want to consider having an outside MDS / billing expert conduct chart audits to identify areas for improved documentation and coding practices, because even after eight months, many SNFs are still leaving revenue on the table related to suboptimal documentation, coding and billing processes. 

Another opportunity for improving revenue is related to CMS changes for skilling in place and 3-day waivers. Extended through the 25th of July, SNFs should absolutely still be utilizing these waivers to capture opportunity to avoid re-hospitalizations, provide optimal care and recognize additional revenue. 

Q: Many SNFs were just getting comfortable with leveraging Group & Concurrent Therapy in the New World of PDPM. Just as therapists and patients were ramping up this treatment approach, COVID-19 pandemic derailed the progress.  What is the future of Group and Concurrent Therapy?

A: The use of group and concurrent therapy will return slowly. As of June, HealthPRO Heritage began recommending the appropriate provision of group & concurrent therapy with the support of our physician consultant, Dr.  James Avery, and in accordance with CDC and CMS guidelines.  After all, several benefits exist for those communities who can safely reintegrate group and concurrent treatments, including social well-being for residents who have been isolated/quarantined and the priceless peer-to-peer interaction that improves outcomes.  Obviously, the use of group and concurrent therapy can help mitigate therapy costs, too, but it must be provided safely and with clearly defined benefits. 

For those facilities looking to reintegrate group and concurrent therapy, HealthPRO Heritage harnessed dedicated staffing for specific patient populations and strategized on gym redesign to allow for socially distanced group treatment.  Also, we have allocated specified hours and spaces that could be utilized for group therapy (e.g., only at day’s-end, prior to scheduled cleaning and disinfecting, or early morning for COVID-19 negative patients following evening cleaning to mitigate exposure from others.)  

While some SNFs’ responded to COVID-19 by refusing new or returning patients, others created isolation units or COVID-19-Only units.  What impact did these decisions have on cash flow for skilled nursing?

First, it’s important to remember how PDPM changed admissions processes and requirements back in October for many long-term care providers. SNFs were only just recently getting used to reviewing hospital documentation more carefully and assessing acuity levels more closely. 

Then the admissions processes changed almost overnight when the COVID-19 pandemic started!  Some SNFs made tough decisions to close their community to new or returning patients while others charged forward and opened COVID-19-only units.  Other facilities were mandated to accept COVID-19 positive patients.  While the advantages and disadvantages to these decisions are debatable, it certainly made for some interesting fiscal trends and set SNFs up for scenarios that perhaps we could not have anticipated. 

For example, consider those savvy SNFs that worked hard to rapidly make changes to protect staff and patients and were able to proactively set up COVID-19 isolation units.  A unique opportunity exists for these sites to leverage MDS coding. Likewise, those SNFs able to accommodate and care for higher acuity patients -- who appropriately captured higher intensity of care -- saw this reflected on the MDS and therefore positive impacted their per diem rates.

SNFs that were closed down to new or returning patients throughout the COVID-19 crisis might worry about fiscal sustainability as a result of decreased census over 2-3 months.  Also, depending on local/regional dynamics, SNFs refusing new patients may need to do damage control to repair network partnerships and referral sources if they perhaps put they risked the strength and integrity of hospital partnerships.  Alternatively – by being responsive and innovative – many forward-thinking SNFs who adopted an aggressive approach to treating COVID-19 patients and quickly executed on tangible solutions leveraged an opportunity to reinforce important strategic partnerships and invest in their future.  In addition to helping to fight this national public health emergency, many SNFs can take pride in proving they can adapt to hospitals’ discharge needs – even amidst a global pandemic – and will generate credibility and fortify a reputation as an indispensable partner capable of meaningful contributions.

Going forward, SNFs would be well advised to develop adaptive strategies to demonstrate ability & willingness to meet community and hospital needs. For example, showcase your infection control processes so that hospital partners will know to count on your SNF as a trusted, progressive partner. Focus on infection control will also help prepare for inevitable surveys, support QMs/Star Ratings, and changes that will continue to matter even after this immediate crisis. Consider that NOW is the time for every SNF to offer meaningful solutions, prepare for unforeseen scenarios, and ultimately prove their worth as the referring hospital’s essential strategic partner.

Q: What strategic suggestions can you offer SNFs to make a short and long-term impact on your fiscal bottom line?

A: For those SNFs who rely on a therapy company to support their rehab team:  ask what additional resources are available (beyond the provision of traditional therapy services) to help meet specific organizational goals?  Are there additional services to help improve efficiencies (such as workflow and/or documentation redesign) that will ultimately help to offset the cost of therapy? How is your current partner strategically contributing to your program’s overall performance (not only from a clinical perspective, but also an economic one?)

Now is the opportune time to assess whether your therapy contract is equitable, strategically well-aligned with market dynamics, and reflecting the drastic changes brought by COVID-19.  Evaluate your options, because there is not a one-size-fits-all answer to the question “What’s the best structure for therapy contracts?”  SNFs must first clearly define their own organizational goals, and vet what model best suits their needs.   For example, smaller SNFs may simply want a contract based on one of the several traditional rate structures, while some providers may want to consider a holistic, partnership approach that includes strategy consulting and services for the whole house to drive net performance, and will consider pricing based on a “percent of the whole” per diem reimbursement rate. Many not-for-profit organizations value the benefits associated with maintaining in-house therapy departments, but may want to consider the advantages of accessing resources, utilization pathways (to manage efficiency/cost) and clinical pathways (to assure exceptional outcomes) via experts that specialize in therapy management.

Therapy contracts should be customized to reflect what is most important to you as a provider (e.g.: patient-centered care?  payer mix targets? clinical outcomes that drive network partnerships/census? revenue targets?) As such, partnership agreements should reflect different rates for different payers and account for I-SNIPS and Managed Medicare Part B, if applicable.  Also, consider the advantages of pricing and terms based on incentives for driving quality outcomes, performance outcomes and/or fiscal cost savings. 

Moreover, whether in-house or out-sourced to a rehab company, therapists on site at your community are in a unique position to strategically drive outcomes.  Specifically, consider whether your therapists:

  • Are highly trained and expected to work at the top of their license to maximize care planning & outcomes;
  • Understand/are interested your community’s overall goals and are able to align initiatives in support of those goals;
  • Big Picture initiatives that impact Star Ratings & Quality Measures and/or support CMI processes to help community’s overall standing
  • Proactively provide solutions during COVID-19 crisis such as virtual support and education for leadership and frontline teams to assure safety and high-quality patient care; out-of-the-box therapeutic solutions to maintain high quality functional outcomes throughout the pandemic; and willingness to help source PPE and taking the lead in infection control initiatives.

Hopefully, these tips helps providers as they carefully consider next steps and look towards the future! 

Tags: COVID-19