PHOENIX — The unrelenting push toward value-based care should compel skilled nursing providers to grab the reins, even after years of regulators failing to invite them more fully into the process.
That was the message delivered by a national skilled nursing executive, a major insurance company leader, and the nation’s fastest growing provider of Institutional-Special Needs Plans, or I-SNPs, during the eCap West Summit last week.
The shift away from traditional Medicare is nothing new, with Medicare Advantage penetration now surpassing 50% in 26 states and Puerto Rico. But as the Centers for Medicare & Medicaid Services continues its push to get all remaining Medicare beneficiaries into MA and other types of value-based care arrangements by 2030, the pressure is growing.
More VBC arrangements could undercut financial stability at a time of major economic and employment uncertainty for the long-term care sector, noted Ted Wahl, president and CEO of Healthcare Services Group and moderator of a Tuesday panel. This is especially a threat because so many VBC programs give acute and primary care providers the power to make care coordination decisions that often minimize the role of skilled nursing, he noted.
COVID also slowed the movement of more skilled providers into I-SNP arrangements, which allow nursing homes to target their spending and innovate on the clinical side with capitated payments and the ability to earn risk-based rewards.
That means plenty of skilled nursing organizations still need to figure out how to embrace and benefit from value-based strategies in the next six years.
“It might be nice to say that every beneficiary is part of a value-based relationship by 2030, but is that actually relevant and translating to a value-based model of care or delivery system in post-acute? I don’t know that it is yet,” said Jess Dalton, vice president of strategic alignment and innovation for Ensign Services.
“We’re certainly trying to get there. I would say that we have constant communication and conversations, to almost the point of pleading, with our managed care relationships and executives locally and nationally to help us to help them to develop value-based care constructs and reimbursement methodologies for the post-acute provider and patient,” Dalton added.
“It has deepened our relationships with our payers and providers. It’s provided them perspective that, although we’re a small percentage of the total Medicare dollars spent, we can have a significant impact in the lives of individuals from a quality perspective if we just simply pivot and look at the quality, deliverables and the outcomes that we can drive. But they don’t come cheap, and they do require some additional consideration.”
Not sitting and waiting
Dalton said Ensign has tried to be an early adopter of several CMS models, even when there’s no direct value or reimbursement win for nursing homes. The operator, which has 312 healthcare facilities in 14 states, is mapping out a game plan to embrace the new Transforming Episode Accountability Model, or TEAM, proposed by CMS in April.
The company is doing so even before CMS announces which hospitals and markets it will target with mandatory participation.
The alternative payment model puts acute care hospitals in charge of coordinating 30 days worth of care for people with traditional Medicare who undergo joint replacement, bypass or several other surgical procedures. That would mean connecting patients to primary care services for accountability purposes, and paying for use of services such as skilled nursing stays or follow-up visits.
“Holding individuals accountable for all the costs of care for an episode may incentivize care coordination, improve patient care transitions, and decrease the risk of avoidable readmission,” CMS said in its proposal, which still must be finalized before a targeted 2026 roll out.
“We could sit and wait and begin to speculate which [areas] are going to be impacted immediately, but instead we’re educating our teams. We’re constructing data and dashboards that follow the track,” Dalton said.
That positions the company to pitch itself to hospitals.
“We may have been kind of carved out of this model of care, this value-based option, but we believe we have a value play and we can grow your value play, and here’s how,” Dalton said he would tell hospital partners. “We’re ready to come to the table and say, ‘This is a facility that’s going to be a great partner to you.’ … There’s an element of proactivity. That’s extremely important. We’re all accustomed to chasing the dollar. The dollar is now housed within value. So from an organizational lens, we’re chasing value.”
I-SNPs work to hasten growth
Insurers are also chasing value as they’re pressured to reduce duplicative or otherwise unneeded services from the healthcare system. That’s one goal of Humana’s new plan being offered in conjunction with Longevity Health, an independent I-SNP provider that covers 9,000 members in 300 facilities.
“Any time payers and providers can get on the same side of the incentive table and we’re aligned around quality and cost effectiveness, we’re always going to be in a better spot,” said Catherine Field, senior vice president and Medicare division leader for Humana. “When we align incentives with providers, we find that we end up being able to reduce costs and improve quality.”
Longevity has seen a five-fold increase in sign-ups since the end of the public health emergency, said CEO René Lerer.
“These buildings really get very engaged in the management of their patients,” Lerer said. “They become very much aware of the services that are provided to their members inside and outside of that setting.”
For most big insurers, I-SNPs haven’t been a major focus, Lerer noted. But as demographics are shifting and Medicare Advantage penetration increases, that’s beginning to change. And that means more opportunity for nursing homes to select partners that can help them deliver better care and earn incentive payments for quality.
“The world of post-acute is becoming materially more important,” Lerer said.
“We know there’s pressure on nursing homes as far as short-term stays, as far as rates and lengths of stay,” Lerer added later. “We believe that long-term stays are growing. There’s a lot of push to move people into the home care setting by the government, but I think we all know there’s a significant population that just aren’t going to leave.”
Those long-stay residents, many of them dually eligible for Medicare and Medicaid coverage, present a great opportunity for skilled nursing operators from a value-based perspective. Having a plan that provides additional clinical support through nurse practitioners and technology can allow greater proactive, holistic care for patients who may live in a building for several years.
“It is causing us to think differently and really understand the nuances of [SNF] businesses that maybe we don’t always appreciate when we have 8,000 skilled nursing facilities in our network,” Field said. “When we become partners on the residential, long-term side, we now have a basis for building a deeper partnership, and I think it serves both sides well.”
