Let’s take a trip back in time to 1982. Hair was big and Olivia Newton-John was even bigger. Hospitals were paid based on the bills that they submitted. This form of payment focused on increasing the number of service rather than the quality of the care itself.
It was right around then that two researchers were tasked with “fixing the system” by looking at patterns in patient data. After examining the correlation between diagnosis, medications and costs they determined that the fewer co-morbidities, the smaller the cost to the healthcare system. This realization lead to a huge change for the U.S. healthcare system as it moved from fee-for-service to bundled payments.
Now fast forward in time to 2016 and we are seeing the post-acute care industry go through a similar transformation. The same philosophy is being used yet again to maximize value for patients at SNF and ALF facilities; moving away from RUGs-based reimbursement to an episodic payment model. The Triple Aim objective has brought a renewed focus on quality measures, readmissions, and even length of stay. All post acute facility managers need to come to grips with the fact that in the very near future all ALFs and SNFs will be compensated based on an ability to meet pay for performance benchmarks.
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