MSPB, IMPACT and The Delivery Model of the Future

1. MSPB, IMPACT and The Delivery Model of the Future October 16, 2014 Josh Luke, Ph.D., FACHE Founder, National Readmission Prevention Collaborative Interim CEO, Memorial Hospital of Gardena Adjunct Faculty, CSULB Healthcare Administration Department Author, Readmission Prevention: Solutions Across The Provider Continuum

2. Presentation Objectives • The delivery model of the future • The New Readmission Penalty: MSPB • IMPACT: Who wins??? • Position yourself as a preferred provider through innovation Let’s get off the starting line and skate to where the puck will be! Its time to innovate and transform!

3. So Cal Readmissions Update Summit – 10/16/2014 Josh Luke, PhD., FACHE • SNF Administrator for Kindred • CEO for HealthSouth Las Vegas Rehab Hospital • Hospital CEO (WMCA); and now Interim CEO at Memorial Hospital of Gardena • VP, Post Acute at Torrance Memorial Health System • Home health and Hospice oversight • Developed award winning Post Acute Network • Selected to author Readmissions book for ACHE

4. 1998…….It was a very good year

5. 1998…….It was a very good year

6. Grandma Belva March 1920 – July 2002 Congestive Heart Failure The Summer of 2002 Home Hemet Valley Medical Center LTACH Nursing Home Home with Home Health * Hemet Valley Medical Center Nursing Home Assisted Living with Home Health *Hemet Valley Medical Center Nursing Home *Hemet Valley Medical Center * Readmission $0 $48,000 $52,000 $12,000 $4,000 $36,000 $18,000 $4,000 $42,000 $24,000 $58,000 $298,000

7. Delivery Model of the Past • The Fee For Service free for all • All providers win with every admission or case • Who gets paid for utilization? • Acute Stay: 1) Doctor, 2) Hospital • Post Acute Stay: 1) Doctor (again), 2) SNF/LTACH/IRF • Home Health: 1) Doctor (again x 2), 2) HH Agency • Follow- up Doctors Office Visit: 1) Doctor (again x 3)

8. What Does this all mean to us as providers? We must coordinate care The Affordable Care Act is not a request, but a mandate with significant penalties if we do not. What does this mean for the acute hospital sector?

9. Are you Ready for the truth? The goal is to find a better way for individuals to age and heal at home. The truth is that my job is not to teach you how to prevent re-admissions, its to teach you to prevent….Admissions. Welcome to the world of… ADMISSION PREVENTION

10. What does this mean for you? Hospitals = Last resort SNF = Second to last resort; increase capability to handle med surg level patients Home health = Networks will be narrowed Patients will be directed to lower levels of care and care paid privately (ALF, home care, remote monitoring)

11. Winning! • So who is winning? • Home Care • Private duty nursing • Assisted living • Who can position for success? • Health systems designed so that hospital is truly the last resort • SNF’s who are willing to push for shorter LOS

12. Transitional Care, Wellness & Revenue Streams • Direct to SNF transfers from the ED • Remote monitoring at home and in SNF • Home visits • Expansion of Home Health to Ambulatory case managers Home Dr. Office SNF Hospital Hospital Home Health Everyone is being incentivized to avoid the hospital

13. Obama AlaskaHypothetical New City Home Doctors office Wellness clinic/gym OP/Ancillary Services Assisted Living SNF Hospital Health System of the Future

14. Obama AlaskaThe System of Old – The Fee-For-Service Free-for-All Home Doctors office Wellness clinic/gym OP/Ancillary Services Assisted Living SNF Insert Hospital Here! Hospital

15. Story TimeOnce Upon a time… Old Hospital = 290 beds New Hospital = 249 beds Hospital Bed Capacity Post ACA Era The Fee For Service Free-for-All Era

16. Six Reasons to Coordinate Care ACO’s (MSSP incentive) Bundled Payment Initiatives Value based Initiatives Readmission Penalties RAC Audits MSPB Four of the six above have not been relevant enough to get hospitals to react

17. MSPB: The New Readmission Penalty • Medicare Spending Per Beneficiary • Effective October 1, 2014 • An MSPB episode includes all Medicare Part A and Part B claims paid during the period from 3 days prior to a hospital admission through 30 days after discharge.

18. IMPACTHere Comes Reason #7 to Coordinate Care Improving Medicare Post-Acute Transformation Act of 2014 IMPACTAct of 2014 takes a crucial step toward the modernization of Medicare payments to post-acute care (PAC) providers Who wins? Maybe no one: It appears to be more documentation to prove medical necessity

19. MSPB: The New Readmission Penalty • Each hospital’s average episode spending levels are separated into three time periods: • 1) During the 3 days prior to the index admission • 2) During the index admission • 3) During the 30 days after hospital discharge. • Within these three time periods, the average episode spending levels are further broken down into seven provider types (e.g., inpatient, outpatient).

20. MSPB: Hospital Sample • Medicare.gov, Hospital Compare • 3 days Prior SNF $ Spent • Hospital A: $13 .05% • State $3 .02% • National $2 .01% • 30 days after discharge SNF $ Spent • Hospital A: $3,942 14.84% • State $3,309 16.85% • National $2,924 15.63%

21. MSPB: Hospital Sample • Medicare.gov, Hospital Compare • During Index Hospital Stay IP $ Spent • Hospital A: $7,889 29.7% • State $8,910 45.36% • National $8,534 45.63% • Complete Episode (MSPB) Total Spending • Hospital A: $26,560 100% • State $19,642 100% • National $18,704 100%

22. MSPB: Hospital Sample • Medicare.gov, Hospital Compare • 1-30 days After Inpatient Spending • Hospital A: $8,967 33.0% • State $2,476 12.6% • National $2,532 13.54% Inpatient includes LTACH, IRF and Readmissions. Readmission rate is only .04% - so there is LTACH and IRF utilization.

23. MSPB: The Feds Finally Got it Right! We must coordinate care The Affordable Care Act is not a request, but a mandate with significant penalties if we do not. What does this mean for the acute hospital sector? What Does this all mean to us as providers?

24. Connectivity and Care Planning • Hospitals must be connected to their post acute providers and innovate • Risk stratification software & post acute connectivity • Remote monitoring units • Formalize relationships for Care Planning support to reduce workload and provide ambulatory case management services • Care Patrol Community Integration Model: Designed Specifically to Assist Hospitals with MSPB • Care Centrix HomeStar: Home Health management

25. The transformation of the acute hospital: the C-suite must take action Hospital Health System Managed care Coordinating Care for Improved Outcomes • Hospitals must act like health systems • Health systems must act like managed care organization • Thus, the hospital must act like a managed care organization as well

26. SNF Providers:Are You Ready for the New Normal? What if, on December 31, 2014 you received a notification from CMS advising you that…

27. Duals: Something Has Got to Give • Bad News • Pre-authorizations • Shorter LOS • Reduced reimbursement • Good News • Narrow networks for those committed to quality • Its inevitable that the three midnight requirement go away if managed care can approve a direct from home to SNF admissions

28. Post Acute Expectations • POLST • SBAR • Stop and Watch • Return to Acute Log (Emergency Dept) • Return to ED Root Cause Analysis • DNA testing for improved Medication Management • Predictive software/electronic quality data * * Only tactic requiring investment; small price to pay to be preferred provider

29. Four examples of Value-Added Innovation • Risk Stratification in acute and post acute connectivity • Software such as RightCare Solutions (UPenn) identifies & connects • Remote monitoring in SNF’s, Home Health and Assisted Living: • Shortens acute Length of stay • Predictive software (Coms Interactive) in SNF’s: • Trains nurses when red flags arise and how to react to warning signs • DNA Testing in SNF’s, Home Health and Assisted Living: • To improve outcomes, reduce med usage, med errors and overall costs (MSPB) based on a persons genetic map These are all MSPB solutions as well.

33. The Super SNF Stop looking at competitors within the SNF industry for the answers and start innovating Hospital based SNF’s within a mile of your facility get paid $800-$1100 a day for SNF patients; why don’t you?

34. Key Action Items • Find value added opportunities to differentiate • Remote monitoring • Risk stratification & post acute connectivity • Genetic (DNA) testing • Predictive software • Innovate and Differentiate • Readmission Tool Kits • Fellow in Readmission Prevention • Certified Readmission Prevention Partner program • Outreach to your referral partners consistently • On the 15th of each month: Share the tools above!

35. NationalReadmissionPrevention.com • Our website was created to showcase “Best Practice” case studies online – submit yours today Northern Cal Readmissions Summit Special 15% discount today only for these products at the registration table – while supplies last! • Fellow Certificate in Readmission Prevention • Certified Readmission Prevention Partner • Hospital, SNF, Home Health Readmission Tool Kits

36. NRPC Conferences in 2015 Readmission Conference Schedule Las Vegas: January 15, 2015 San Diego: February 5, 2015 Phoenix: February 12, 2015 Anaheim: March 2015 (free readmissions book to first 100 to register!)

37. My Legacy:Going Purple for My Mom As my mother enters her golden years and struggles with the effects of Alzheimer’s Disease, It is my hope and goal that we as a healthcare community can continue the movement towards a patient centered delivery system. - Josh Luke

38. Go Purple to fight Alzheimer’s Disease! • Josh Luke, Ph.D., FACHE • Founder, National Readmission Prevention Collaborative • Interim CEO, Memorial Hospital of Gardena • Executive Faculty, CSU Long Beach • Author: Readmission Prevention: Solutions Across the Provider Continuum JoshLuke@NationalReadmissionPrevention.com NationalReadmissionPrevention.com