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4 tips for home care agencies taking on bundled payments

Near the end of 2015, the Centers for Medicare and Medicaid (CMS) published its final rule for Comprehensive Care for Joint Replacement (CJR), a bundled-payment model for hip and knee surgeries. CMS has signaled that there will be more of these programs as the industry shifts from fee-for-service to value-based care. Unlike other bundled-payment models, this program is not optional.

In 2014, more than 400,000 Medicare beneficiaries received a hip or knee replacement. Post-acute care, such as skilled nursing or physical therapy, follows many of the hospital stays for these patients. Homecare can be an important contributor to ensure the patient is not re-hospitalized during this period. CJR goes into effect January 15, 2016 and is applicable on April 1, 2016, when the first model performance period begins.

There has been a lot of discussion about what the CJR rule means for hospitals, but what do these bundled-payment models mean for home health agencies?

A recent Home Health Care News article points out the risks and rewards of bundled payments for home health. It features Allscripts Homecare™ client Home Care by Black Stone (Cincinnati, Ohio, U.S.A.). This forward-looking agency is already participating in multiple bundle-based payment plans, and CEO David Tramontana shared several pieces of advice throughout the article:

1) Reduce risk of readmissions

“The best position for a home health agency in a bundled payment scenario is to help providers reduce the risk of readmission for their patients,” Tramontana said. “The only lever that you have to actually gain financially in the bundled payment for a home health provider is if you improve your own readmissions based upon your historic costs.”

2) Develop strong relationships with hospitals

“When I look at the bundled payment program, I think it’s an opportunity for us to work with providers upstream that are taking risks and develop those preferred provider relationships,” Tramontana said. Once positioned as a preferred provider, a home health agency can share in the hospital’s potential savings incentives.

3) Invest in data analytics

“The data analytics firm you choose is really important to understand how to choose the right bundles and then manage the cost within those bundles,” Tramontana said. Agencies must be able to accurately measure and report on patient data to participate.

4) Expect a longer timeline for Medicare reimbursements

“Until the claims are actually paid by CMS, you won’t know the actual cost of care for your patient, and it probably takes about six months to have good visibility on what the total claims were for each individual episode,” Tramontana said.

As the world’s population ages and strains acute care resources, home care becomes an increasingly important piece of the continuum of care. Agencies that can effectively participate in new payment models will be the ones to succeed in the long term.

To do so, homecare agencies will need a good handle on their processes, specifically with any CJR patients, from referral through outcomes and payment. If you have questions about Allscripts Homecare™ or preparing for bundled-payment models, contact us.

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