Next Steps in Improving Healthcare Value: Postacute Care Transitions: Developing a Skilled Nursing Facility Collaborative within an Academic Health System

Hospitals and health systems are under mounting financial pressure to shorten hospitalizations and reduce readmissions. These priorities have led to an ever-increasing focus on postacute care (PAC), and more specifically on improving transitions from the hospital.^1,2 According to a 2013 Institute of Medicine report, PAC is the source of 73% of the variation in Medicare spending³ and readmissions during the postacute episode nearly double the average Medicare payment.⁴ Within the PAC landscape, discharges to skilled nursing facilities (SNFs) have received particular focus due to the high rates of readmission and associated care costs.⁵

Hospitals, hospital physicians, PAC providers, and payers need to improve SNF transitions in care. Hospitals are increasingly responsible for patient care beyond their walls through several mechanisms including rehospitalization penalties, value-based reimbursement strategies (eg, bundled payments), and risk-based contracting on the total cost of care through relationships with accountable care organizations (ACOs) and Medicare Advantage plans. Similarly, hospital-employed physicians and PAC providers are more engaged in achieving value-based goals through increased alignment of provider compensation models^6,7 with risk-based contracting.

Current evidence suggests that rehospitalizations could be reduced by focusing on a concentrated referral network of preferred high-quality SNFs;^8,9 however, less is known about how to develop and operate such linkages at the administrative or clinical levels.⁸ In this article, we propose a collaborative framework for the establishment of a preferred PAC network.

One mechanism employed to improve transitions to SNFs and reduce associated readmissions is to create a preferred provider network. Increasing the concentration of hospital discharges to higher performing facilities is associated with lower rehospitalization rates, particularly during the critical days following discharge.¹⁰

While the criteria applied for preferred provider networks vary, there are several emerging themes.¹⁰ Quality metrics are often applied, generally starting with Centers for Medicare and Medicaid Services (CMS) quality star ratings and Long-Term Care Minimum Data Set (MDS) metrics with additional criteria frequently layered upon those. Some examples include the extent of physician coverage,¹¹ the extent of nursing coverage (eg, nursing ratios or 24/7 nursing care), geographic access, and flexible admission times (including weekends and nights).¹² In addition, several outcome measures may be used such as 30-day readmission rates, patient/family satisfaction ratings, ED visits, primary care follow-up within seven days of PAC discharge, or impact on the total cost of care.

Beyond the specified criteria, some hospitals choose to build upon existing relationships when developing their preferred network. By selecting historically high-volume facilities, they are able to leverage the existing name recognition amongst patients and providers.¹³ This minimizes retraining of discharge planners, maintains institutional relationships, and aligns with the patients’ geographic preferences.^2,13 While the high volume SNFs may not have the highest quality ratings, some hospitals find they can leverage the value of preferred partner status to push behavior change and improve performance.¹³