Urgent Care in the Nursing Home: Aligning the Incentives

Perhaps nowhere are incentives more misaligned than they are when it comes to providing urgent care to a nursing home resident. Picture the following typical scenario: Mrs. M, an elderly nursing home resident, is found to be having a productive cough and a fever. The nursing staff can complete an assessment and provide this information to the attending physician who can then order diagnostic studies and treatment, or, instead, the nursing staff can call the attending and simply state, “The resident does not look good” and recommend that the resident be sent to another facility for treatment. To the nurse, this means that there is no need to complete an assessment, to obtain tests and treatments, or to further manage this resident; instead, one call to 911 is all that is needed.

From the attending physician’s perspective, sending the resident to the emergency department for assessment and any future management means decreased liability. And for those attendings who also follow their patients in the hospital, it can mean increased visit revenue for the acute care management of the patient. For the nursing home’s administrator, sending the resident to the hospital means decreased liability and increased revenue when that resident returns to the nursing home under the Medicare Part A subacute stay. One can easily see that the current incentives for sending residents to hospitals do nothing to encourage nursing homes to raise their level of clinical services so that residents can be cared for in the nursing home, thus avoiding hospitalizations.

The costs of a nursing home failing to provide appropriate urgent care to its residents are significant and will likely grow. Beyond the overall increased healthcare costs related to acute hospitalization instead of ongoing care in the nursing home setting, there are additional “costs,” including the emotional trauma to the resident and family due to a transition in care and the well-established adverse effects and iatrogenic complications of hospitalization. In one study, for instance, 58.3% of elderly patients suffered at least one iatrogenic complication during their hospitalization.¹ A recent study from the Henry J. Kaiser Family Foundation asserts that a 25% reduction in hospitalizations among Medicare beneficiaries residing in long-term care facilities would have yielded an estimated savings of $2.1 billion last year alone.²

The findings from the Centers for Medicare & Medicaid Services (CMS) Nursing Home Special Study demonstrated that a reduction in potentially avoidable hospitalizations by 33% would save Medicare over $1 billion annually.³ This number is not surprising to those who understand the scope of the problem. A study published in 2000 showed that 40% of hospital admissions and 36% of emergency department transfers among 100 residents from seven Los Angeles nursing homes were considered inappropriate.⁴ In a more recent study, it was found that in New York state, Medicare spent more than $200 million on hospitalizations related to ambulatory care–sensitive diagnoses among long-stay nursing home residents, meaning diagnoses that could have been treated in the nursing home rather than in the hospital.⁵ The scope of this problem makes it clear that, at a time of limited healthcare resources, we cannot afford to provide inappropriate care.

Aligning Incentives

The correction of this problem has already begun in long-term care. For example, the alignment of incentives is a cornerstone of Medicare’s Special Needs Plans (SNPs)⁶ which, rather than serving all Medicare beneficiaries in a geographic region as traditional Medicare managed care plans are required, focuses on one of three unique groups: persons with a specific chronic illness such as Alzheimer’s disease; those with both Medicare and Medicaid coverage; and persons who are institutionalized. UnitedHealthcare has developed a program for nursing home residents called Evercare, which focuses on nursing home residents as a specific population served by an SNP. The Evercare program is responsible for Medicare Parts A, B, and D of these patients but also has the freedom to operate more efficiently than Medicare, and the Evercare program can therefore offer unique services. For one, the Evercare program increases the availability of primary care services by having a dedicated nurse practitioner available in the nursing home. This level of availability increases the likelihood that an acute change in condition can be assessed directly on-site by a member of the primary care team rather than over the phone by an attending physician who may not be fully aware of the resident’s current status and needs. Beyond increased primary care services, Evercare can provide immediate skilled services without the 3-day hospitalization required by Medicare; this allows residents who require intravenous hydration and medications to receive them when needed in the nursing home setting.

The same incentives found in SNPs drive the Program for All-Inclusive Care for the Elderly (PACE) to care for its participants once they become permanent nursing home residents. PACE programs are responsible for all Medicare- and Medicaid-related services for their participants. As a result, PACE participants who are residing in a long-term care facility have incentives that promote treatment in the most efficient and effective manner, including aggressive urgent care services when needed within the nursing home.

More recently, there has been discussion regarding Accountable Care Organizations (ACOs). An ACO is “an organization of healthcare providers that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program who are assigned to it.”⁷ If a nursing home was to adopt an ACO-like structure, it would become accountable for the health outcomes of its residents in a much more comprehensive financial manner.

In addition to providing urgent care to its residents, a fully capitated nursing home would also align some of the other services provided, including Medicare Parts B and D–covered services. Under Medicare Part B, each physician visit is paid via Medicare on a pure volume basis without regard to outcomes. A capitated nursing home model would replace that provider incentive aimed at volume-based utilization with one focused on value-based reimbursement. With the nursing home responsible for care outcomes, physician visits will need to be better managed to optimize outcomes. This has led to greater discussion related to the benefits of having salaried physicians as employees of the nursing home.

Medicare Part D is equally misaligned. Under the current Medicare Part D program, prescription drug plans (PDPs) have incentives to limit access to prescription medications without regard to outcomes. In fact, PDPs benefit most financially when a resident is admitted to a hospital using medications that are being paid for by the hospital instead of the PDP. Once the patient is back in the nursing home, the facility has no incentive to ensure that only the most cost-effective medications are being used beyond the Medicare Part A stay since the PDP is responsible for the cost of medications used by non-subacute nursing home residents. Prior to Medicare Part D’s introduction in 2006, New York state paid nursing homes a daily rate that covered each resident’s medications. It was then up to the nursing home to manage the residents’ medication utilization. This was somewhat problematic because, while nursing homes were responsible for controlling medication utilization, they were not incentivized to do so, or to improve outcomes such as reduced emergency department visits or hospitalizations. Nursing homes considered their responsibility only in terms of medication utilization. As a result, New York saw some of the lowest nursing home pharmaceutical utilization rates in the country.⁸ Under a fully capitated model, the nursing home would be responsible for all Medicare Part A, B, and D expenditures for all residents; in theory, this would promote a more appropriate focus on overall care outcomes in a more efficient and effective manner.

These types of models are expected to be promoted through CMS’s newest center: The Center for Medicare & Medicaid Innovation (http://innovations.cms.gov), authorized by the Patient Protection and Affordable Care Act and led by Richard Gilfillan, MD. The Innovation Center was given $10 billion to spend through 2019 to assess payment initiatives such as care coordination and bundled payments. It is possible that the Innovation Center will take up nursing home care, providing bundled payments to improve care coordination and encouraging the delivery of urgent care services within the nursing home for residents in need.

Tools to Improve Nursing Home Urgent Care

Of course, even after incentives are better aligned, positive results are not guaranteed. To be successful, nursing homes will need to have a supportive infrastructure that includes more nurses with better training to manage, recognize, and care for acute care issues; improved capabilities for on-site diagnostic testing; increased availability of treatment options such as intravenous or subcutaneous fluids; and increased availability of primary care providers and other healthcare professionals who are better trained in the principles of good geriatric and long-term care. The need to improve our current and projected significant shortages in the geriatric workforce has been identified by the Institute of Medicine.⁹ The ongoing failure to address the “physician payment fix” and its projected impact on physician reimbursement from Medicare will likely continue to have a negative impact on the availability of physicians to care for older adults. In addition to these critical resources, greater adherence to evidence-based care paths and attention to advance care planning is needed to avoid harmful or futile care.

Some available resources that pull together many elements aimed at improving the clinical services in these areas are the tools, educational materials, and implementation strategies provided by the Interventions to Reduce Acute Care Transfers (INTERACT) II (http://interact2.net). Any nursing home attending physician who has received a call from the nursing staff about a patient’s change in condition will appreciate the SBAR (Situation, Background, Assessment or Appearance, Request) Communication Tool and Progress Note (http://bitly_SBAR-Tool), one of the many available tools from INTERACT II. Imagine hearing an SBAR presentation of an acute change in Mrs. M’s condition rather than staff simply saying that she does not look good and that they need an order to send her out to another facility. Another resource is the American Medical Directors Association (AMDA-LTC Medicine) clinical practice guideline “Acute Change of Condition in the Long-Term Care Setting,” which is aimed at improving the skill set of nurses through better recognition, assessment, treatment, monitoring, and communication of acute changes of condition, thus leading to fewer potentially avoidable transfers to acute care hospitals.¹⁰

With such a large landscape, a starting point has already been identified by the Medicare Payment Advisory Commission (MedPAC), an independent congressional agency established by the Balanced Budget Act of 1997 to advise the U.S. Congress on issues affecting Medicare. In its “Report to Congress,” MedPAC identified the conditions that are most likely contributing to avoidable hospitalizations for nursing home residents, including congestive heart failure, respiratory infections, urinary tract infections, sepsis, and electrolyte imbalances.¹¹ To lay the foundation for improved nursing home care, we can build on the experiences of other individuals and organizations and incorporate their findings into our own care settings.

Act Now

Those of us who are involved in nursing home care can start moving toward a more outcome-focused care delivery system within our nursing homes by first raising the level of clinical services that are available. Even without being incorporated into an ACO, there are processes and tools that nursing homes can implement today, such as those provided in the INTERACT II tool kit and the AMDA-LTC Medicine guidelines. And these tools can help right now.

It is important to acknowledge that, for many nursing homes, this approach will require a significant change in current care patterns, including considerable staff education; however, there are incentives to adopt this approach since it will likely lead to better financial performances for nursing homes that are able to manage the ill nursing home patient and avoid hospital transfers. Finally, a more integrated system, through a nursing home that adopts an ACO structure, could bring new resources and skills into the nursing home from the partnering organization/hospitals. In the end, it appears that incentives are aligning to promote and support changes in current nursing home care patterns to allow for ill residents to receive urgent care in the nursing home, avoiding an expensive and potentially avoidable hospital transfer.

Because of the increasing care acuity of nursing home residents and our current limited healthcare resources, the time to act is now. Nursing homes—with expert input from attending physicians and medical directors—can begin to develop processes to improve urgent care services for nursing home residents so that when the need to provide more accountable care arises in your nursing home, it will be ready to care for residents such as Mrs. M in a manner that optimizes care outcomes—in a more cost-effective but not less compassionate way—across the board.

The author reports no relevant financial relationships.

Dr. Stefanacci served as a CMS Health Policy Scholar for 2003-2004, and is Medical Director, NewCourtland LIFE Program, Associate Professor of Health Policy, University of the Sciences, and Chief Medical Officer, Promidian Consulting, Philadelphia, PA. Dr. Spivack is Associate Physician Editor ofClinical Geriatrics, and is Associate Clinical Professor of Medicine, Columbia University, New York, NY, and Consultant in Geriatric Medicine, Greenwich Hospital, Greenwich, CT.

References

1. Lefevre F, Feinglass J, Potts S, et al. Iatrogenic complications in high-risk, elderly patients. Arch Intern Med 1992;152(10):2074-2080.

2. Jacobson G, Neuman T, Damico A; The Henry J. Kaiser Family Foundation. Medicare Spending and Use of Medical Services for Beneficiaries in Nursing Homes and Other Long Term Care Facilities: A Potential for Achieving Medicare Savings and Improving the Quality of Care. The Henry J. Kaiser Family Foundation. October 2010. www.kff.org/medicare/upload/8109.pdf. Accessed January 14, 2011.

3. Fitzpatrick JJ, Stone P, Hinton Walker P, eds. Annual Review of Nursing Research, Volume 24, 2006: Focus on Patient Safety. New York, NY: Springer Publishing Co; 2006.

4. Saliba D, Kington R, Buchanan J, et al. Appropriateness of the decision to transfer nursing facility residents to hospital. J Am Geriatr Soc 2000;48(2):154-163.

5. Grabowski DC, O’Malley AJ, Barhydt NR. The costs and potential savings associated with nursing home hospitalizations. Health Aff (Millwood) 2007;26(6):1753-1761.

6. Centers for Medicare & Medicaid Services. Special Needs Plan—Fact Sheet & Data Summary. www.cms.gov/SpecialNeedsPlans/Downloads/FSNPFACT.pdf. Accessed January 14, 2011.

7. CMS/Office of Legislation. Medicare “Accountable Care Organizations” Shared Savings Program – New Section 1899 of Title XVIII. Preliminary questions & answers. https://www.cms.gov/OfficeofLegislation/Downloads/AccountableCareOrganization.pdf. Accessed January 30, 2011.

8. Schneider A. Dual eligibles in nursing facilities and Medicare drug coverage. Kaiser Family Foundation. November 13, 2003. www.kff.org/medicaid/upload/Dual-Eligibles-in-Nursing-Facilities-and-Medicare-Drug-Coverage.pdf. Accessed January 14, 2011.

9. Institute of Medicine of the National Academies. Retooling for an Aging America: Building the Health Care Workforce. www.iom.edu/Reports/2008/Retooling-for-an-Aging-America-Building-the-Health-Care-Workforce.aspx. April 11, 2008. Last updated December 17, 2010. Accessed January 14, 2011.

10. AMDA. Clinical practice guideline: Acute change of condition. www.amda.com/tools/cpg/acoc.cfm. Accessed January 26, 2011.

11. Medicare Payment Advisory Commission (MedPAC). Report to the Congress: Increasing the Value of Medicare. June 2006. www.medpac.gov/documents/jun06_entirereport.pdf. Accessed January 14, 2010.