Only Innovation Will Reduce Readmissions

Body, Mind, Soul, And Spirit ConceptAs reported on yesterday in Kaiser Health News, over 2,600 US hospitals – the most to date – will have their average Medicare reimbursement rates reduced over the period October 1, 2014 through September 30, 2015, due to the Hospital Readmissions Reduction Program. The overall reduction is projected to realize $428 million in savings to Medicare – i.e., translated as lost revenue to hospitals.

For anyone still unfamiliar with the reductions program, in a nutshell it is an attempt to use public policy to achieve more efficient alignment between patent care requirements and the overall cost of care provided – particularly to the extent costs are driven by care setting. Or, more pragmatically, Medicare does not want to pay the comparatively higher overhead costs associated with acute care settings if a patient’s readmission to that setting could have been avoided.

Of course, there’s the rub that will eventually have to be reconciled if the program is to remain: can we really objectively and often times arbitrarily determine what’s avoidable? The primary reason this is so difficult is because of the myriad environmental considerations that impact patient recovery and sustainable treatment away from the acute care setting. Where someone lives (housing), their neighborhood, their human support network, access to transportation, cognitive state and capacity for engagement, recognition of comorbid considerations such as anxiety and depression – the list goes on.

Hospitals and their clinical teams are taking the readmission program seriously. A three-percent reduction in revenue from your largest source when you are already struggling with narrow margins has that effect. New efforts to forge relationships with post-acute/long-term care providers, patient communication strategies, multi-provider think tanks, post-discharge follow-up programs, transitional care planning, utilization of telehealth and telemonitoring technology, targeted disease intervention – these primarily represent the extension, or repurposing, of core clinical capabilities.

Not to discount the importance of these initiatives, but by and large there is nothing all that innovative here when compared to the fundamental nature of the problem we are trying to solve. And there is a limited ability to address the fundamental challenge driving hospital readmissions: the environmental obstacles shared above. Worse yet, these tactical approaches fail to embrace the holistic reality that is patient treatment and recovery.

That’s where innovation efforts have to be focused: not on keeping someone out of the hospital but on removing the environmental obstacles that drive readmissions as a consequence of undesirable recovery and sustainability. As Toby Cosgrove, President and CEO of the Cleveland Clinic wrote earlier this week, “as my friend Professor Michael Porter of Harvard Business School says, innovation is the only solution to … long term issues faced by American healthcare.”

And it will ultimately be the only solution to lowering hospital readmissions.

  ~ Sparky

Readmission for Life

Readmissions. A term that has become ingrained in the lexicon of governmental agencies, elected officials, healthcare policy analysts, healthcare provider institutions – and even care providers. The case is made simply enough: it is far less costly to care for someone at home or in a congregate setting than in a hospital. More nuanced, the logic follows that both efficiency and quality can be maximized by utilizing the setting that costs just enough to provide quality outcomes.

And so a lot of money is being spent – by the government in the form of research and testing grants, as well as both for profit and nonprofit healthcare providers, all wanting to better understand how to keep people out of the hospital without impacting their health. Of course, Medicare’s Hospital Readmissions Reduction Program is also providing an incentive as hospitals seek to avoid up to a 3% reduction in Medicare reimbursement.

The Internet is replete with articles and stories on the how and why of reducing readmissions. I have written about the topic extensively on this blog. It has captured my attention because that is where Artower Advisory Services, positions itself: at the intersection of acute and post-acute/long-term care.

I have a growing concern that the dialogue over readmissions is becoming increasingly academic and pedantic. The measures of programming success have not been clearly defined because of the simple reality that success needs to be defined differently for each patient.

People react to environmental stimuli in different ways. Two patients with the same condition and otherwise similar health may be better served in different settings. One patient might have great comfort in being at home – to the extent where their mental state promotes healing faster than in an institutional setting. Another patient may need the real or perceived sense of security from being at the hospital where immediate attention is just down the hall.

In more than a few ways the initiative to reduce hospital readmissions has been an effort to pick the low-hanging fruit. Anecdotally, I am convinced from spending years working with healthcare providers that patients needlessly end up in the hospital because of poor communications, silo operations and the practice of defensive medicine.

There are tremendous opportunities for performance improvement. Along with reducing costs and improving outcomes, however, we must be diligent in developing outcome measures that reflect the subjective reality that every patient is unique.



Readmission Realities

The topic of Hospital Readmissions has evolved into a primary point of discussion and debate within the nation’s lexicon of Healthcare Reform, most notably through broadly accessed media outlets not typically associated with in-depth reporting on medicine and healthcare. As often happens, by the time such a topic traverses the tipping point of being newsworthy it will have actually been around for quite a while in  smaller though certainly no less important academic circles.

As an example, Dr. Elliott Fisher and colleagues were sharing their research findings on hospital readmissions back in 1994 in the New England Journal of Medicine. Using Medicare claims data they studied discharge patterns in Boston and New Haven between October 1987 and September 1989. What they found was that, “hospital-specific readmission rates varied substantially …” and that “no relation was found between mortality (during the first 30 days after discharge or over the entire study period) and <sic> either community or hospital-specific readmission rates.”

In their conclusions they noted that, “regardless of the initial cause of admission, Medicare beneficiaries who were initially hospitalized in Boston had consistently higher rates of readmission than did Medicare beneficiaries hospitalized in New Haven. Differences in the severity of illness are unlikely to explain these findings. One possible explanation is a threshold effect of hospital-bed availability on decisions to admit patients.”

In other words, despite what is  understandably a popular media association, identification, concern and debate over whether and how reducing hospital readmissions represents a prudent means of lowering healthcare expenditures without impacting quality or outcomes is not a phenomenon borne of the Affordable Care Act. More importantly for my purpose here, understanding the history of hospital readmissions as a policy topic is to understand and accept the challenges associated with developing public policy intended to incent reductions.  And of course, the primary case in point here is Section 3025 of the Affordable Care Act, the Hospital Readmissions Reduction Program (HRRP).

I believe there is justifiable concern with the HRRP, particularly in the realm of unintended consequences. But I also believe those concerns have thus far tended to be self-serving and inflated when compared to the potential benefits. I addressed these points just about a year ago in the post, Is Focus on Hospital Readmissions Misguided? That was in reaction to another article published in NEJM, Thirty-Day Readmissions – Truth and Consequence. Now fast forward to an article published this past week in the NEJM, A Path Forward on Medicare Readmissions. Are you getting the sense that the hospital readmissions topic is nothing if not complex and contentious?

In this latest contribution to the subject, authors Drs. Karen Joynt and Ashish Jha identify two recent developments that provide insights into how HRRP implementation appears to be playing out.  The first was a MedPAC report evidencing a decrease in national rates of readmission for all causes, from 15.6% in 2009 to 15.3% in 2011. The second is an emerging recognition, based on CMS reports, that hospitals most susceptible to financial penalties under the HRRP are also those most likely to provide care for individuals with complex and/or expensive healthcare needs. In other words, this suggests that HRRP implementation has the potential to provide a financial disincentive leading to disparities in care availability.

Rather than chucking the HRRP as a policy failure, however, the authors suggest an approach that is quite admittedly conceptually foreign to a government characterized by intransigence and stubbornness: they suggest modifying the program in reaction to what is learned during implementation. Specifically, they first suggest adjusting readmission rates for socioeconomic status. Second, they suggest weighting the HRRP penalties according to the timing of the readmission to better recognize the potential causes of that readmission. And finally, they suggest an offsetting credit be given for comparatively lower mortality rates in recognition of hospitals – e.g., large teaching hospitals – where readmission rates are more likely to be an expected consequence of keeping their sickest patients alive.

The authors correctly point out that, “no policy is ever perfectly designed at inception, and policies should be changed as new evidence emerges.” At the same time, we should be cognizant where policies reach too far or are impractical in their design. For example, the UK’s National Health System (NHS) Medical Director, Bruce Keogh, announced this past Friday that hospitals there will face future reduction in fees for failing to follow the latest clinical guidance (i.e., quality standards).

In my thinking, there is both a philosophical as well as practical difference between policies that provide financial incentive through measuring health outcomes versus measuring the means and methods of achieving those outcomes. But if our aim is to develop a healthcare system that leverages the productivity and efficiency advantages of market-based solutions, while guarding against the market failures inherent to healthcare, we will need to be vigilant in avoiding the slippery slope of policy dysfunction.


Acute & Post-Acute/Long Term Care: How to Have That Difficult Conversation

We’ve all experienced times in our lives when we have to face a difficult conversation and the angst with which we anticipate its completion.  An example might be the nervousness and anxiety of approaching someone to whom we are romantically attracted.  Another example would be the dread and sorrow of approaching someone with news we know will devastate them.  More relevant to my purpose here are the myriad types of challenging but routine conversations that fall well within those two extremes.

In particular, I am referring to the conversations that are now beginning to take on a true sense of importance and urgency between leadership teams at acute care organizations and post-acute/long-term care (PA/LTC) organizations.  Whether driven by regulatory influence (e.g., the Hospital Readmission Reductions Program), new payment models (e.g., bundling pilots), cost containment initiatives or wanting to truly develop a full continuum of care, hospital administrators are getting earnestly engaged in wanting to understand how PA/LTC providers can help them reduce average length of stay and avoidable readmissions.

For healthcare organizations used to operating in silos, discussing subjects like strategic objectives, market positioning and perceived organizational strengths and weaknesses with other healthcare providers – let alone non like-kind providers – can be a most uncomfortable experience.  And that discomfort can cause such discussions to be entirely unproductive.  Time-wasting in today’s healthcare environment will not only put an organization at a competitive disadvantage – it is a short and narrow path to economic collapse.  So the obvious challenge is how to make sure such conversations – or meetings – are both meaningful and productive. 

From what I have observed and experienced over the past couple of years as a party to a number of these leadership conversations, there are some basic, yet very important, guidelines you can follow to help ensure the time you spend is productive and of value.  I have shared these below and hope that you find them useful.

Create a Statement of Purpose
How many times have you been to a meeting where a colleague says to you under her breath, “why are we here?” A Statement of Purpose should provide a clear articulation of why you are meeting and what must absolutely be accomplished for it to be a valuable use of everyone’s time. 
For example, a Statement of Purpose might read,

We will meet on <date> for the express purpose of creating a shared understanding of the joint-venture opportunity being considered, the attendant opportunities and risks, and whether both parties have sufficient interest in pursuing the joint-venture further.  Evidence of that interest will be satisfied if the parties enter into a Letter of Intent within 30 days following the meeting.

Drill Down on Your Value Proposition
Before meeting, have a very good understanding of why a potential venture or opportunity would be of value to your organization.  Define that value nominally (i.e., put it into real numbers).  For example, know that if successful, the project will add a net cash benefit of $X annually to your organization.  It is typically difficult to quantify economic success given the level of ambiguity at the early stages of discussion, but most executives I have worked with are usually surprised at the analytical specificity achievable when they are forced to work through assumptions and parameters.  And it is the very development of those assumptions and parameters that should serve as the meeting content (see next guideline).

Avoid Meeting Until There is Something to Discuss
I had a physician colleague tell me once that thousands of great ideas are presented and discussed at lunch tables across the country every day, yet very few ever make it back to the office – let alone to the type of initiative that merits having two organizations meet to discuss.  As Ashleigh Brilliant once wrote, “Good ideas are common – what’s uncommon are people who’ll work hard enough to bring them about.”

Generating interest and enthusiasm for a good idea (e.g., a joint venture) is usually a pretty enjoyable experience, so there is the natural inclination to want to meet and share that idea.  In my personal experience – and a lesson I had to learn the hard way – this is where most often ideas go to die.  They literally get talked into submission from exuberance over the imagined benefits before they can gain any traction and the support necessary to make it past lunch.

This is why taking the time and effort to develop the business case for a proposed venture before bringing the two parties together is so crucially important.  The level of detail should obviously be in sync with the desire to maintain a strong position of negotiation, but both parties must be able to understand the fundamental framework and objective reasoning that merit the time being committed by individuals attending that meeting.

Set Discussion Boundaries
Both parties should know in advance what they are willing and prepared to discuss.  As mentioned above, there ought to be a cognizant recognition that while bargaining in good faith should be a given, information is power in negotiation.  And while meeting to determine whether a potential venture merits further investment may not represent significant exposure, all too often information is exchanged without due consideration.  Of course, having a nondisclosure agreement in place is wise, and the terms and conditions will provide valuable guidance in establishing your conversational boundaries.

Have the Right People There – And Have Them Focused
With the advances made in information technology over the past decade, the ability to communicate with someone has never been easier – yet being heard has never been more challenging.  Competing for attention is one of the greatest singular obstacles to advancing organizational initiatives today.  It often requires a fair amount of dogged commitment, humility and political savvy to coordinate schedules in a way that gets the right people at the meeting in a frame of mind to concentrate on the meeting content.  But it is an effort that cannot be minimized without jeopardizing success.

Consider Using a Facilitator
Having a productive meeting often depends on the ability to stay focused on the deal points and ensuring you have the right levels of individual participation.  Personality types often dictate that level of participation, and without an objective means of balancing certain types, a few people can dominate the discussion – even if they aren’t the ones empowered to make decisions. 

Having a clearly defined agenda and a third-party facilitator that is familiar with your industry and business can add significant value.  That individual should have experience in effectively managing discussions and debate, ensuring that key concepts are introduced at just the right moments and have the ability artfully keep participants focused on the primary elements that comprise the Statement of Purpose.

Environmental trends and drivers are pushing acute and PA/LTC leadership teams to accelerate their interest in partnering on market initiatives that require collaborative efforts.  From the very beginning, the success of such initiatives depends on the ability to engage in meaningful and productive conversation.  By having the discipline and foresight to follow some basic guidelines those leadership teams can help avoid wasting valuable time.



The Trouble with Avoidable Readmissions

183911-vlcsnap_2010_05_16_21h56m32s5As a Scot (my name is spelled with one, “t” because my father wanted to be sure I never forgot), I remember with both amusement and annoyance a line from the movie, Braveheart: “The trouble with Scotland is that it’s full of Scot’s.” As I see it, the trouble with trying to address healthcare costs through reducing avoidable readmissions is that there are too many readmissions. Bear with me . . .

Avoidable hospital readmissions are the lowest of low hanging political fruit in the Healthcare Reform debate, representing an immediacy of opportunity to impact aggregate healthcare spending for very little political capital in exchange. The means of cost reduction is directly controlled by the Federal government – in the form of Medicare payment reductions. And the organizations identified as the culprit deserving of such reductions are those behemoth institutions of waste and inefficiency: the hospitals (yes, that’s sarcasm).

To be sure, there is substantial evidence where individuals discharged from a hospital stay wind up back in the hospital because of factors and events that could have been avoided. But avoided by whom – how – and at what cost? Healthcare providers of all types that will be impacted by the readmission penalty had better begin to understand the economic ramifications of how these questions are going to be answered.

As has been rather widely publicized – yet from my personal observation, up until just recently still largely ignored – the Affordable Care Act (ACA) included Section 3025: Hospital Readmissions Reduction Program. Section 3025 amended the Social Security Act such that it now requires CMS to reduce payments to IPPS hospitals with excess readmissions, effective for discharges beginning on October 1, 2012 (i.e., in a few weeks). Initially, the Program has established readmission measures for Acute Myocardial Infarction (AMI), Heart Failure (HF), and Pneumonia (PN).

Excess readmission ratios are calculated by comparing national average rates of readmission for patients discharged to a hospital’s individual experience while relying on a methodology endorsed by the National Quality Forum (NQF). I recognize this is a gross oversimplification, but all of the detail you could hope to find is now widely available – whether on the CMS site referenced above or many other organizations that have made such information available on their web sites.

For FY 2013, determination of the excess readmission ratio is based on actual discharges having occurred during the 3-year period of July 1, 2008 to June 30, 2011. According to a Kaiser Health News report, more than 2,000 hospitals will begin to see payment penalties under the program due to patients being readmitted within the 30-day threshold.  The overall anticipated impact of these penalties is approximated to be $280 million over the next year.

Not surprisingly, as with many aspects of the ACA, the Readmissions Program carries with it a great deal of controversy.  Many clinicians, including physicians, who are directly responsible for the care of those individuals represented by the statistics entering into the determination of a readmission penalty feel that readmissions are ultimately driven by acute medical needs – and patients that need to be in a hospital, well, they need to be in a hospital. Simple as that. Better to pay a relatively small penalty than have a patient die trying to avoid it goes the thinking.

Yet those involved in healthcare delivery on all sides (the clinical, the social, the community and the administrative) understand first-hand the reasonable and plausible goal that the Readmissions Program is seeking to address: a reduction in readmissions that are caused by insufficient and/or improper assistance and care available to the individual after being discharged from a hospital; i.e., the avoidable readmission.

Readmissions resulting from the natural progression of a disease state, comorbidities, unexpected and/or negative reactions to post-discharge treatment – there is legitimate concern that the Readmissions Program will interfere with clinicians’ ability to effectively manage their patients’ health in lieu of what are being considered unwarranted and unwelcomed outside influences and distractions. On the other hand, readmissions that result from a decline in condition owing to non-clinical factors, such as personal trauma associated with transferring and transitioning, the failure to follow a prescribed post-discharge treatment regimen (e.g., diet, exercise, medication), the inability to keep medical appointments – these are significant contributors to readmissions that PA/LTC organizations can have a significant impact upon.

But being able to determine cause in individual cases is going to be a monumental challenge that neither the ACA, nor the regulations promulgated for the Readmissions Program, adequately address. It is going to result in a lot of finger pointing on ward floors – and underneath the tables in board rooms. So we are left with two choices: do some more complaining and hope that the ACA is repealed (and replaced by an ultimately very similar Republican approach two or three years from now), or roll up our sleeves and be innovative in spite of the regulatory challenges.

For those PA/LTC organizations wishing to pursue the latter, I suggest they begin to invest immediately in the development of an operational infrastructure that will facilitate their ability to record, monitor and report the requisite data elements that can be used to evidence all of the contributing factors leading to hospital readmissions of the individuals under their care – clearly and unequivocally. Though, in theory, a large part of the impetus for the Readmissions Program is to engage hospitals in having accountability and responsibility for patients’ welfare post-discharge, as a PA/LTC provider I would interpret that reality as being given responsibility without authority.

Remember this: knowledge is power.  Before engaging in any type of contractual agreement with a hospital that ascribes financial responsibility for hospital readmissions, the PA/LTC organization must be in a position of negotiating strength.  That strength will come from the ability to know and understand – before the hospital does – the nature and root cause of a readmission.  Power will also come from the ability to support that understanding with evidentiary support.

The other integrated concept here, of course, is risk management.  The same knowledgebase that can be used to build negotiating strength can be used to mitigate the risks  – market, operational and financial – associated with hospital readmissions.

PA/LTC provider organizations stand to benefit in several ways from the Hospital Readmissions program.  The inherent demand generated by hospitals seeking to have greater control of post-discharge outcomes should be welcomed in light of trends away from institutionalized care.  The stronger voice many PA/LTC clinical staff have sought in dealing with hospital staff is getting a well-deserved boost.  And done wisely, there are new revenue opportunities available at a time when reimbursement is being ratcheted down at every turn.

As discussed above, however, there are also substantial performance risks that will ultimately bring down some organizations before all is said and done.  Don’t be one of those organizations.

  ~ Sparky

Is Focus on Hospital Readmissions Misguided?

In the April 2012 issue of the New England Journal of Medicine there was a Perspective’s article that is being circulated and discussed: Thirty-Day Readmissions – Truth and Consequence (you can download and read the article by clicking on it in my Dropbox™ account to the right).  In the article the authors argue, “that policymakers’ emphasis on 30-day readmissions is misguided.”

They present three reasons:
1. many of the variables inherent in driving readmissions are beyond the hospitals’ control (e.g., “patient-and community-level factors”), and they note that, “it is unclear whether readmissions always reflect poor quality”;
2. improved discharge planning and care coordination could be more effectively achieved by focusing on other metrics, rather than readmissions; and
3. resources committed to reducing readmissions may be better allocated to focus areas able to demonstrate a perceived higher ROI (e.g., patient safety and quality).

I think this misses the point as to why there is a focus on hospital readmissions.  In particular, noting that readmissions may not reflect poor quality seems like a fallacious assertion because I don’t think the argument is being made (at least by those who understand the issues and concerns) that readmissions necessarily do reflect poor quality.  At issue is whether the readmission could have been avoided with more effective care planning and transitioning – and thus equal or better care provided in a lower cost setting.  From listening to nursing staff at PA/LTC facilities, the evidence of opportunities for care transitioning improvement is overwhelming, albeit anecdotal from my frame of reference.

Admittedly, it is very difficult to study the true economic impact of hospital readmissions by attributing their causes.  Some patients should never have been discharged in the first place, and there are a host of reasons that drive premature hospital discharges.  Some patients are discharged to inappropriate settings – often because the patient and/or patient’s family intervenes over the recommendations of physicians and/or discharge planners.  Some patients are convinced they can follow a required post-discharge regimen and fall way short within the first 24 hours.  While some patients need just a little support (e.g., queuing, companionship, medication management), but they are in a situation where they have none.  And finally, some patients – particularly the elderly – are significantly impacted emotionally by care setting transitions, leading to adverse reactions that are very unpredictable.

But research has shown that education, coaching and timely intervention can be very effective in disease management.  We know that getting patients to change risky behaviors and become better self-managers of care can improve outcomes across a range of chronic illnesses.  We know that doctors have neither the training nor the time to engage in counseling on behavior change or to give self-management support. 

So it is inevitable that PA/LTC organizations will need to play a growing and critical role in designing, planning and implementing post-discharge care transitioning programs for patients in need of chronic disease management.  The sooner those organizations embrace the importance of this role and begin to build the requisite knowledgebase to be successful partners in integrated care delivery models, the better chance they will have of surviving in an era of Healthcare Reform.

A good place to begin for many of those organizations may be to become familiar with the work of Dr. Eric Coleman (University of CO Denver School of Medicine) and his colleagues on care transitions.  Many of the PA/LTC organizations that I work with now talk of the, “Coleman Model” and/or the “Coleman way” as an emerging standard bearer.  Here’s their web site:

Have a Wonderful Memorial Day – and let’s all be very thankful to the brave men and women that have given so much to ensure we still have the ability to share ideas like I do here, open and freely!

  ~ Sparky



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