Peter J. Huckfeldt

Medicare’s Bundled Payment Pilot for Acute and Postacute Care: Analysis and Recommendations on Where to Begin

In the National Pilot Program on Payment Bundling, a subset of Medicare providers will receive a single payment for an episode of acute care in a hospital, followed by postacute care in a skilled nursing or rehabilitation facility, the patients home, or other appropriate setting. This article examines the promises and pitfalls of bundled payments and addresses two important design decisions for the pilot: which conditions to include, and how long an episode should be. Our analysis of Medicare data found that hip fracture and joint replacement are good conditions to include in the pilot because they exhibit strong potential for cost savings. In addition, these conditions pose less financial risk for providers than other common ones do, so including them would make participation in the program more appealing to providers. We also found that longer episode lengths captured a higher percentage of costs and hospital readmissions while adding little financial risk. We recommend that the Medicare pilot program test alternative design features to help foster payment innovation throughout the health system.

Racial-Ethnic Disparities in Management and Outcomes Among Children With Type 1 Diabetes

BACKGROUND AND OBJECTIVES: Previous research has documented racial/ethnic disparities in diabetes treatments and outcomes. It remains controversial whether these disparities result from differences in socioeconomic status (SES) or other factors. We examined racial/ethnic disparities in therapeutic modalities and diabetes outcomes among the large number of pediatric participants in the T1D Exchange Clinic Registry. METHODS: The cohort included 10 704 participants aged <18 years with type 1 diabetes for ≥1 year (48% female; mean age: 11.9 ± 3.6 years; diabetes duration: 5.2 ± 3.5 years). Diabetes management and clinical outcomes were compared among 8841 non-Hispanic white (white) (83%), 697 non-Hispanic black (black) (7%), and 1166 Hispanic (11%) participants. The population included 214 high-income black and Hispanic families. RESULTS: Insulin pump use was higher in white participants than in black or Hispanic participants (61% vs 26% and 39%, respectively) after adjusting for gender, age, diabetes duration, and SES (P < .001). Mean hemoglobin A1c was higher (adjusted P < .001) in black participants than in white or Hispanic participants (9.6%, 8.4%, and 8.7%). More black participants experienced diabetic ketoacidosis and severe hypoglycemic events in the previous year than white or Hispanic participants (both, P < .001). There were no significant differences in hemoglobin A1c, diabetic ketoacidosis, or severe hypoglycemia between white and Hispanic participants after adjustment for SES. CONCLUSIONS: Even after SES adjustment, marked disparities in insulin treatment method and treatment outcomes existed between black versus Hispanic and white children within this large pediatric cohort. Barriers to insulin pump use and optimal glycemic control beyond SES should be explored in all ethnic groups.

Effects of Medicare payment reform: Evidence from the home health interim and prospective payment systems

Medicare continues to implement payment reforms that shift reimbursement from fee-for-service toward episode-based payment, affecting average and marginal payment. We contrast the effects of two reforms for home health agencies. The home health interim payment system in 1997 lowered both types of payment; our conceptual model predicts a decline in the likelihood of use and costs, both of which we find. The home health prospective payment system in 2000 raised average but lowered marginal payment with theoretically ambiguous effects; we find a modest increase in use and costs. We find little substantive effect of either policy on readmissions or mortality.

Medicare Postacute Care Payment Reforms Have Potential To Improve Efficiency Of Care, But May Need Changes To Cut Costs

The Affordable Care Act mandates changes in payment policies for Medicare postacute care services intended to contain spending in the long run and help ensure the programs financial sustainability. In addition to reducing annual payment increases to providers under the existing prospective payment systems, the act calls for demonstration projects of bundled payment, accountable care organizations, and other strategies to promote care coordination and reduce spending. Experience with the adoption of Medicare prospective payment systems in postacute care settings approximately a decade ago suggests that current reforms could, but need not necessarily, produce such undesirable effects as decreased access for less profitable patients, poorer patient outcomes, and only short-lived curbs on spending. Policy makers will need to be vigilant in monitoring the impact of the Affordable Care Act reforms and be prepared to amend policies as necessary to ensure that the reforms exert persistent controls on spending without compromising the delivery of patient-appropriate postacute services.

Effects of an intervention to reduce hospitalizations from nursing homes: A randomized implementation trial of the INTERACT program

Importance Medicare payment initiatives are spurring efforts to reduce potentially avoidable hospitalizations. Objective To determine whether training and support for implementation of a nursing home (NH) quality improvement program (Interventions to Reduce Acute Care Transfers [INTERACT]) reduced hospital admissions and emergency department (ED) visits. Design, Setting, and Participants This analysis compared changes in hospitalization and ED visit rates between the preintervention and postintervention periods for NHs randomly assigned to receive training and implementation support on INTERACT to changes in control NHs. The analysis focused on 85 NHs (36 717 NH residents) that reported no use of INTERACT during the preintervention period. Interventions The study team provided training and support for implementing INTERACT, which included tools that help NH staff identify and evaluate acute changes in NH resident condition and document communication between physicians; care paths to avoid hospitalization when safe and feasible; and advance care planning and quality improvement tools. Main Outcomes and Measures All-cause hospitalizations, hospitalizations considered potentially avoidable, 30-day hospital readmissions, and ED visits without admission. All-cause hospitalization rates were calculated for all resident-days, high-risk days (0-30 days after NH admission), and lower-risk days (≥31 days after NH admission). Results We found that of 85 NHs, those that received implementation training and support exhibited statistically nonsignificant reductions in hospitalization rates compared with control NHs (net difference, −0.13 per 1000 resident-days; P = .25), hospitalizations during the first 30 days after NH admission (net difference, −0.37 per 1000 resident-days; P = .48), hospitalizations during periods more than 30 days after NH admission (net difference, −0.09 per 1000 resident-days; P = .39), 30-day readmission rates (net change in rate among hospital discharges, −0.01; P = .36), and ED visits without admission (net difference, 0.02 per 1000 resident-days; P = .83). Intervention NHs exhibited a reduction in potentially avoidable hospitalizations overall (net difference, −0.18 per 1000 resident-days, P = .01); however, this effect was not robust to a Bonferroni correction for multiple comparisons. Conclusions and Relevance Training and support for INTERACT implementation as carried out in this study had no effect on hospitalization or ED visit rates in the overall population of residents in participating NHs. The results have several important implications for implementing quality improvement initiatives in NHs. Trial Registration clinicaltrials.gov Identifier: NCT02177058

The Effect of Prospective Payment on Admission and Treatment Policy: Evidence from Inpatient Rehabilitation Facilities

We examine provider responses to the Medicare inpatient rehabilitation facility (IRF) prospective payment system (PPS), which simultaneously reduced marginal reimbursement and increased average reimbursement. IRFs could respond to the PPS by changing the number of patients admitted, admitting different types of patients, or changing the intensity of care. We use Medicare claims data to separately estimate each type of provider response. We also examine changes in patient outcomes and spillover effects on other post-acute care providers. We find that costs of care initially fell following the PPS, which we attribute to changes in treatment decisions rather than the characteristics of patients admitted to IRFs within the diagnostic categories we examine. However, the probability of admission to IRFs increased after the PPS due to the expanded admission policies of providers. We find modest spillover effects in other post-acute settings and negative health impacts for only one of three diagnostic groups studied.

Hospital and Regional Variation in Medicare Payment for Inpatient Episodes of Care

Hospital and Regional Variation in Medicare Payment for Inpatient Episodes of Care Health care spending varies widely between geographic regions, but there is disagreement regarding the appropriate policy response.1 Regional policies include reducing Medicare payment rates in high-spending regions,2 limiting the supply of health care facilities using certificate-of-need criteria, and implementing care-improvement collaboratives. The Institute of Medicine opposed regional policies in favor of hospitaland health care professional–focused policies, such as bundled payments, accountable-care organizations, and value-based payments.3 Their concern was that substantial variation in Medicare spending occurs within geographic regions3-5 and highperforming hospitals and health care professionals in lowperforming regions would be unfairly penalized by regional policies. To further inform this debate, we compared the amount of spending variation that occurs between regions vs between hospitals.

Medicare Payment Reform and Provider Entry and Exit in the Post-Acute Care Market

OBJECTIVE To understand the impacts of Medicare payment reform on the entry and exit of post-acute providers. DATA SOURCES Medicare Provider of Services data, Cost Reports, and Census data from 1991 through 2010. STUDY DESIGN We examined market-level changes in entry and exit after payment reforms relative to a preexisting time trend. We also compared changes in high Medicare share markets relative to lower Medicare share markets and for freestanding relative to hospital-based facilities. DATA EXTRACTION METHODS We calculated market-level entry, exit, and total stock of home health agencies, skilled nursing facilities, and inpatient rehabilitation facilities from Provider of Services files between 1992 and 2010. We linked these measures with demographic information from the Census and American Community Survey, information on Certificate of Need laws, and Medicare share of facilities in each market drawn from Cost Report data. PRINCIPAL FINDINGS Payment reforms reducing average and marginal payments reduced entries and increased exits from the market. Entry effects were larger and more persistent than exit effects. Entry and exit rates fluctuated more for home health agencies than skilled nursing facilities. Effects on number of providers were consistent with entry and exit effects. CONCLUSIONS Payment reform affects market entry and exit, which in turn may affect market structure, access to care, quality and cost of care, and patient outcomes. Policy makers should consider potential impacts of payment reforms on post-acute care market structure when implementing these reforms.

Less Intense Postacute Care, Better Outcomes For Enrollees In Medicare Advantage Than Those In Fee-For-Service

Traditional fee-for-service (FFS) Medicares prospective payment systems for postacute care provide little incentive to coordinate care or control costs. In contrast, Medicare Advantage plans pay for postacute care out of monthly capitated payments and thus have stronger incentives to use it efficiently. We compared the use of postacute care in skilled nursing and inpatient rehabilitation facilities by enrollees in Medicare Advantage and FFS Medicare after hospital discharge for three high-volume conditions: lower extremity joint replacement, stroke, and heart failure. After accounting for differences in patient characteristics at discharge, we found lower intensity of postacute care for Medicare Advantage patients compared to FFS Medicare patients discharged from the same hospital, across all three conditions. Medicare Advantage patients also exhibited better outcomes than their FFS Medicare counterparts, including lower rates of hospital readmission and higher rates of return to the community. These findings suggest that payment reforms such as bundling in FFS Medicare may reduce the intensity of postacute care without adversely affecting patient health.

Adults with type 1 diabetes: Partner relationships and outcomes.

Health outcomes of adults with type 1 diabetes may be affected by relationship status and quality. Our objective was to examine associations between relationship status, relationship factors, and outcomes in adults with type 1 diabetes. N = 1660 participants completed surveys measuring relationship satisfaction and perceived partner support style (active engagement, protective buffering, over-protection). Differences in glycemic control and adherence for those married/partnered versus not were insignificant. Higher relationship satisfaction, and having an engaged, not over-protective, partner was associated with better glycemic control and self-care. Helping partners support patients, avoiding over-protection, may enhance relationship and diabetes-related patient outcomes for adults with type 1 diabetes.