OpenPlacement Blog

Accommodating Patient Choice in Bundled Payment Initiatives


The hospital, as part of the discharge planning process, must inform the patient or the patient's family of their freedom to choose among participating Medicare providers of post hospital care services and must, when possible, respect patient and family preferences when they are expressed. The hospital must not specify or otherwise limit the qualified providers that are available to the patient. (42 C.F.R. § 482.43[c][7]).

According to the Code of Federal Regulations, hospitals and discharge planners are under obligation to allow their patients freedom of choice when choosing a post-acute care provider. This, coupled with the desire of the hospital to keep patients in network, can lead case managers and discharge planners to be concerned about potential antitrust charges when recommending care providers patients moving to the next stage of their care. To further complicate things, under the Bundled Payment for Care Improvement initiatives (BPCI) recently being tested by the Centers for Medicare & Medicaid Services (CMS) providers are encouraged to keep costs low throughout not just acute care, but in post-acute care as well. So how does one reconcile the need to provide the highest quality of care at the lowest cost without violating regulations?

Disclosure. Disclosure. Disclosure.

While Federal Regulations do state that the hospital cannot tell patients where to go for post-acute care, patients still rely on case managers and discharge planners to help them navigate the sometimes complicated healthcare system. The regulations specifically note that the hospital cannot limit a patient's choice of qualified providers, including those providers that the hospital has a financial stake in. The law is as follows: "The discharge plan must identify any Home Health Agency (HHA) or Skilled Nursing Facility (SNF) to which the patient is referred in which the hospital has a disclosable financial interest, as specified by the Secretary, and any HHA or SNF that has a disclosable financial interest in a hospital under Medicare. (42 C.F.R. § 482.43[c][8])."

However, this stipulation doesn’t mean that a high quality HHA or SNF should be made unavailable to the patient because of fear of anti-trust laws. In fact, it would be acting against the patient’s best interests to leave out any high quality options in their geographical area. It simply means that without bias, the hospital must disclose their relationship with the providers.

Staying Unbiased While Providing The Best Information.

Providing information to patients leaving acute-care without influencing patient choice but still getting the patient the best possible post-acute care can be tricky to navigate. How do I get my patient care that works for them but also lessens the chance of readmission and the readmission penalties that comes along with it? One answer for many discharge planners and case managers is the simple option of writing down options on a piece of paper and letting the patient choose one. This option comes with pitfalls however. Providers must rely on their patients doing their own due diligence to research which choice would be the best for their health, not simply the closest one (which is often the leading factor in choosing a provider for many patients).

In order to mitigate this risk, some hospitals have adopted other strategies to provide choice to their patients. In some hospitals, a new position is created in order to oversee the transition of patients to post-acute care. This nurse can create a care plan, help the patient with research on PAC facilities, determine which other programs a patient might need to be enrolled in (such as Meals on Wheels) to assist with recovery, and follow up at the PAC facility to see that their care plan is being followed. This position means that the patients are not only avoiding being passed around from provider to provider where key information can be missed, but also means that they are followed extensively and thoroughly to get the best possible care.

In instances where the budget doesn’t allow for the creation of a new position, other tools can be utilized. Transition agencies can take the pressure off of discharge planners and case managers who may be overloaded with patients and don’t have the time to research extensively for each patient. These agencies can provide key information on quality based on governmental ratings along with bed availability. This takes the onus of staying unbiased off of the hospital as the quality matrix is simply there for the patient to see and make their own choice.

Communication Is Key.

Whether hospitals opt for a new position, the old stand-by of listing choices on a piece of paper, or use a transition agency, communication across the board from acute-care to post-acute care is key to lowering costs and better outcomes. Educating caregivers on the ins and outs of the BPCI initiatives and CJR models can help providers know what care they are responsible for and for how long. Knowing why the hospital has chosen to implement these programs is also helpful in getting staff on board with the new payment options highlighting better patient outcomes and lower cost.

Communication between providers in acute and post-acute care settings can help avoid complications that could result in hospital readmission and penalties. Effective use of data, including the use of patient stratification and correct coding, can play a large role in whether a patient returns to the hospital for care. High risk patients can be identified and given more focused care. Everyone benefits from quality matrices as well as knowing all of the data available for each patient.

Lessons To Take Away.

In the coming years, changes are coming to Medicare and Medicaid that will necessitate changes on the part of hospitals and providers across the U.S. Implementing systems and working out the kinks now can help caregivers have a smoother transition when introducing bundled payment options in the future. Better outcomes and lower readmission rates coupled with the need to provide patients with federally mandated choice, means navigating the complicated world of acute to post-acute care transitions with care. When patients have the choice of the highest quality HHAs and SNFs with all of the relevant information at their fingertips, and when caregivers have the correct data with providers supporting each other, hospitals win and patients win.

School, C. U. (1994, Dec 13). 42 CFR 482.43 - Condition of participation: Discharge planning. Ithica, New York, United States of America.