OpenPlacement Blog

Utilizing Provider Networks While Respecting Patient Choice

Hospitals and ACOs are under increasing pressure from the new changes instituted by CMS and the Affordable Care Act's value-based purchasing initiatives to produce lower costs in the aim of providing better quality. They are increasingly responsible for the outcomes of patients not only under their care, but also under the care of Home Health Agencies (HHAs) and Skilled Nursing Facilities (SNFs). To mitigate the risk of sending patients to low-quality HHAs or SNFs resulting in patient readmission and readmission penalties, many hospitals and ACOs have begun creating provider networks that can help improve patient outcomes without overly limiting patient choice. By creating these high-quality networks, patients are still allowed freedom of choice, which is mandated by CMS, and hospitals and ACOs can feel secure knowing they've taken steps to reduce readmissions and the penalties that go along with them.


Steps To Creating Provider Networks for Hospitals and ACOs

1. Dedicate Staff to Monitor and Define Provider Networks

Provider networks should be established based on quality metrics agreed on by the hospital or ACO. This information can be compiled however the institution chooses but many use governmental quality data compiled by CMS, such as their Star Rating Program, or use their own compiled data to determine the highest quality HHAs and SNFs available in the surrounding geographic areas.

These providers should be routinely monitored, and if possible, visited by staff dedicated to ensuring that discharged patients receive the highest quality post-acute care possible. Staff involved in creating these networks should not be limited to only discharge planners and case managers. Physicians, along with hospital leadership, should have a voice in which post-acute care providers their patients are sent to, as well.

2. Manage Data

While monitoring the performance of Post-Acute Care (PAC) facilities, hospitals and ACOs should strive to work with the PACs to track patient satisfaction and patient outcomes taking into consideration various quality metrics. The more data the hospital, discharge planners, case managers, and physicians have at their disposal, the more informed their decisions can be and the more protected against violations of Federal Regulation 42 CFR 482.43.

Hospitals and ACOs should also consider utilizing technologies developed to assist case managers and discharge planners manage data and quality metrics. These transition technologies are specifically designed to amalgamate data based on governmental data specific to a patient’s region allowing discharge planners, case managers and nurses to show the patient, in an easy-to-read format, which PAC facilities will work best for them, without any hint of a bias. These technologies fill a much needed service by taking the leg work out of patient transfers, allowing hospital staff to concentrate on providing a seamless transition, and better outcomes, for their patients.

Whatever data management system is used, the decision of where to refer a patient should be backed by clear, concise data showing why they are referring the patient to providers in network instead of other PACs in the area. This data is essential in showing that the hospital is following policy and monitoring quality metrics to make sure that the patient knows that the PAC facility is the best choice for the patient, not for the hospital.

3.  Train Staff on How to Refer Patients

CMS mandates that patients be given a choice of providers in their preferred geographic areas. In order to make sure that the hospital is not violating federal and CMS mandates while making sure that they are referring patients to the highest quality PACs, case managers and discharge planners should be trained in the proper procedures for referring patients. This means that hospital leadership should develop hospital policies regarding discharge and how their staff will deal with referring patients in network. Along these lines, case managers and discharge planners should be thoroughly educated on the new laws pertaining to discharging patients so they know what is legal and what is illegal when recommending a PAC facility. This is another area where technology can assist in making sure that hospital staff are in no way violating mandates, as they can take the onus off of providers to stay unbiased and clearly show that they are referring to the highest quality HHAs and SNFs in the area.

For The Good of All

What hospitals, ACOs, PAC facilities, and patients should keep in mind is that these initiatives were developed to keep costs low while providing the highest quality care to patients. By utilizing provider networks, patients can be assured that they are getting post-acute care that is tailored to their needs, increasing positive outcomes and better quality of life. In fact, by dedicating staff to monitor and defining provider networks, managing data, and correctly training staff, hospitals and ACOs can clearly communicate to patients that their health and well-being is of the utmost importance.  And while the patient is reassured of the hospital’s commitment to their health, the use of provider networks means hospitals and ACOs can be assured that they are going to reduce the risk of readmissions and lower overall costs, proving that everyone can win in a value-based purchasing initiative.

Medpac. (2015). Medicare’s Post Acute Care: Trends and Ways to Rationalize Payments. Medpac.

School, C.U. (1994, Dec 13). 42 CFR 482.43 –Condition of Participation: Discharge Planning. Ithica, New York, United States of America.