The Affordable Care Act (ACA), passed in 2010, addresses Care Redesign through the establishment of the Accountable Care Organization (ACO) model which seeks to rewire care in terms of wellness, efficiency, and cost reduction. Since the ACA became law, a steady series of programming changes have been rolled out, and additional elements of the reform bill contain a mandated sequence of future care modifications we will confront in the near future. As soon as early 2016, many Home Health Providers will encounter the first ACA-mandated Alternative Payment Model (APM) in the form of the CCJR Episodic Bundle Initiative. This Comprehensive Care for Joint Replacement (CCJR) care model takes effect in nearly 700 metropolitan areas next April 1st, and post-acute care management of joint replacements will never be the same.
Alterative Payment Models represent a new set of incentives that build on the progress of healthcare over recent years. They are slated to improve the efficiency and personalization of care programming through emphasizing care coordination and outcomes by controlling costs. APM trials and pilot programs demo improved quality/cost results. APMs are the basis of the ACA–mandated shift from the fee–for–service programming of the PPS era. By tying programs and payment to quality and value, ACA goals are achieved and the change from volume to value begins, and will mature and refine over time. CMS projects that 90% of fee-for-service will shift to APMs by 2018.
CCJR Begins 2016
The CCJR Initiative was announced in July 2015, and it tests bundled payments for Lower Extremity Joint replacements (MS DRG 469/470) across a broad cross-section of hospitals. The goals are better care through increased coordination, healthier patients by connecting hospitals and PAC Providers, and smarter spending by holding hospitals accountable for all episode costs. In operational terms, the CCJR creates an episodic model for joint replacement acute and post-acute care programming. Under CCJR, the entire joint replacement episode, from acute admission and surgery to post-DC treatment (IRF, SNF, HH, OPT), will be the clinical and financial responsibility of the admitting anchor hospital.
Home Health Providers, along with all other Medicare Providers involved in acute or post-acute management of the joint replacement patient, will experience significant alterations in how they deliver care to this population. The CCJR APM is an example of an Episodic Bundled Model, which seeks to reduce or eliminate silo behaviors present in the current care continuum. All Providers display silo behaviors that increase the time and funds necessary to complete an individual patient program, and these are particularly evident in orthopedic joint replacement patients. The 3-day hospital rule for Sub-acute rehab admissions, 21-day SNF stays, generic post-surgical ortho protocols that significantly affect the cost of outcomes; all represent silo behaviors in today’s care continuum.
The CCJR model is based on the CMS Innovation Center Bundled Payment for Care Improvement (BPCI) Model 2 Pilot Programs for joint replacements that have been in effect for nearly two years. The savings and clinical results derived from these pilot programs, compared to significant cost variations for these procedures across the country ($16,500 to $33,000), have prompted CMS to begin Episodic Bundling of these patients on April 1, 2016. In 2012, HHSM developed and was awarded BPCI Model 2 Pilot Program for MS DRG 460/470 – Lower Extremity Joint Replacements with and without complications, in conjunction with the Detroit Medical Center (DMC), a Pioneer ACO system. In addition, HHSM has served as Post-Acute consultant for two additional Pioneer ACO systems in episodic bundling of Total Joint Replacements. The structure of the CCJR, and how it effects Post-Acute care programing and Home Health in particular, is described below.
The CCJR Episodic Bundling approach to Joint Replacement clinical management places clinical and financial responsibility squarely on an individual Medicare Provider, in most cases the anchor hospital where the episode begins. In the case of a CCJR Episodic Bundle, the anchor hospital becomes the Provider AND the payer for all programming for a 90-day period after discharge from the acute care stay. This presents a challenge for SNF and HH Providers who have received Joint Replacement patients from a particular hospital for years; now the hospital is the payer source, and their interest in care content, volume, and billing totals will differ significantly from all previous interactions. The most prominent element of the bundled scenario for the SNF or Home Health Provider is the managed care aspect of patient program management, specifically the clinical content and reporting requirements involved.
When CCJR creates an Episodic Bundle for Joint Replacements, the anchor hospital must examine all programming for savings and care efficiencies, and the standard CCJR program proceeds as follows:
- Acute Hospital – The Target Price, determined by CMS on a per hospital basis, establishes the Medicare savings before the first CCJR surgery is performed (Example – Current Cost – 30K/Target Price – 24K). The hospital must determine post-DC programming for 90 days based on a cost/value determination, and are responsible for any and all costs during that period.
- Post-Acute Provider – Decisions on post-acute treatment of the joint replacement patient will be based on the cost vs. value determination of any particular post-DC Provider, whether IRF/SNF or Home Health. The issues regarding post-acute Provider selection and costs are two-fold; 1) Elimination of silo elements per care site, and 2) Clinical acuity indicators that determine post-acute location based on post-surgical performance needs.
- Management of Global Care Costs – All expenditures incurred during the 90-day bundled period become the responsibility of the anchor hospital, and this significantly changes post-acute care volumes and spending. Inter-connecting software, daily or visit-based clinical rounds, participation in care transition activities, minimizing clinical volume in terms of value, and support for the new care model; all will change daily routines for Home Health Providers.
CCJR 2016 Metropolitan Target Areas
CMS identified nearly 700 metropolitan areas to begin CCJR in 2016, and ALL joint replacement surgeries occurring in those areas will be managed under the Episodic Bundle (expect more areas to be brought on-line in 2017):
Memphis, Nashville, New Orleans, Ashville, Charlotte, Durham, Greenville, NC, Austin, Beaumont, Corpus Christi, Temple, Lubbock, Tyler, Los Angeles, San Francisco, Oakland, Boulder, Denver, Fort Collins, Kansas City, St Louis, Akron, Cincinnati, Miami, West Palm, Orlando, Tampa, Virginia Beach, Indianapolis, Las Vegas, Milwaukee, New York, Newark, Oklahoma City, Pittsburgh, Portland, Seattle, Toledo, Tuscaloosa.
All Total Joint Replacements performed in these areas will only be covered under the CCJR APM, rather than the traditional fee-for-service model we currently.
Home Health under CCJR
The CCJR is based on the BPCI Model 2 Pilot Program for MS DRG 469/470 – Lower Extremity Joint Replacements with and without complications. Having developed and been awarded this BPCI Pilot Program in conjunction with the DMC, I will speak about the Home Health experience under this new care model.
Home Health clearly becomes the Provider of choice under CCJR and other Episodic Bundling models coming in the near future. As a result of their cost levels, and how they compare to other Medicare post-acute Providers, Home Health effectively decides where the patient will be treated upon DC from the acute care facility. Historical use of SNF as sub-acute rehab Providers becomes sharply curtailed as 21 day LOS stats combined with a tendency to maximize billing RUG levels (plus elevated infection and readmission rates) compares poorly to the Home Health cost/value proposition.
Under an Episodic program such as the CCJR, the role of and the reliance on Home Health lies in sharp contrast to how homecare services are viewed and valued today. Patients are vetted for Home Health qualifications, such as caregiver (or available caregiver) presence, safe post-surgical functional mobility, or the ability to provide DME to assure safety in the home. In most cases, this level of post-acute analysis in terms of cost/value leads DC personnel to confront the following type of question – “Should we pay four times the cost required to rehab this patient ONLY BECAUSE they don’t have a bed or bathroom on their main floor, risking infection and readmissions, or should we rent a bed and commode for a week and treat them in their own home with Home Health?”
This example shows how the Episodic Bundled model decreases costs and helps place patients where they belong when the cost/value question is considered. By this means, Home Health becomes the go-to Provider of choice if the patient can be safely treated in this environment. But, more patients coming to Home Health will not represent the volume of patient programming that one might expect given the care continuum levels of today. The DMC Model 2 BPCI Pilot that the CCJR was based on averaged 6-7 rehab visits per Bundled Joint Replacement patients in year one of the pilot program. Year two averaged 5-6 rehab visits per patient, so you can see where this is headed. In addition, the disconnection of outpatient treatment from the follow-up orthopedic visit limits the length of Home Health programs, as many patients are transferred to OPT services by calendar day 14.
Changes in care volumes aren’t the only challenge for Home Heath Providers entering the Episodic Bundling; the gain/risk sharing elements require financial disclosure as you become business partners with the anchor hospital. In addition, initially rewiring front line care delivery, and the veteran staff you employ is a monumental task as you undo years of traditional Home Health Care delivery habits, and trade those for the goals of the CCJR Bundle. Daily reporting, intra-disciplinary software (in addition to Home Health EMR), clinical direction, and having outside forces dictate the time you have with the patient; all challenge the status quo of Home Heath delivery.
The Future of Home Health under the ACA
As care redesign matures, and Home Health settles in to the episodic model, certainly there are some agencies who will struggle, or fail, to adopt to the new requirements and delivery protocols. Others will find establishing agreements with ACOs difficult, or producing stats regarding their legacy as a quality Home Health Provider challenging. Further ACA mandates decrease the identity of the individual care continuum Providers, as payments morph from the current direct-bill status to a single bundled payment to the hospital, who will distribute funds to the various post-acute Providers involved in the care.
The Alternative Payment Model that is CCJR is just the first of many program and care models that the ACA will install that directly affects homecare Providers. Global Bundling of ALL hospital discharges are mandated by 2018. Value-Based Purchasing arrives in 9 states in 2016 (more next year), moving Home Health towards the pay-for-performance model we have discussed for years. Going at risk for readmission, managing care as other Medicare Providers do, and eliminating the clinician-centered care model that Home Health has become; all are mandatory requirements for survival, let alone success in the future. Get ready for CCJR today by taking the first step on the care path of tomorrow.