Examining Post Acute Care Relationships in an Integrated Hospital System. Section 3 Results

02/01/2009

Geographic Distribution of Post Acute Care Providers. The availability of PAC services varies widely across the nation. Skilled nursing facilities and home health agencies are available in every state, although certain states, such as Texas, California, Florida, Ohio, and Illinois have particularly high numbers of PAC providers compared to other states. In addition to looking at the number of PAC providers, it is important to consider the number of beneficiaries that they serve. After controlling for number of residents, states including Louisiana have a high supply of providers per beneficiary population. States with the highest supply of IRF beds per beneficiary included the District of Columbia (2.66 beds per 1,000 beneficiaries), Louisiana (2.09 beds per 1,000 beneficiaries), Arkansas (1.82 beds per 1,000 beneficiaries), and Texas (1.53 beds per 1,000 beneficiaries). The states with the highest supply of SNF beds per beneficiary population included North Dakota (62.69 beds per 1,000 beneficiaries), Iowa (59.98 beds per 1,000 beneficiaries), and Louisiana (57.66 beds per 1,000 beneficiaries). The two states with the highest number of LTCH beds per beneficiary included Massachusetts (3.92 beds per 1,000 beneficiaries) and Louisiana (3.08 beds per 1,000 beneficiaries). Services were less available in some of the rural states. Maryland had the fewest IRF beds per beneficiary, Alaska had the fewest SNF beds per beneficiary, and seven states had no LTCH beds (Montana, New Hampshire, Alaska, Iowa, Maine, Vermont, and Oregon). The majority of LTCHs, SNFs, and HHAs are free-standing, or not owned by an acute hospital. The majority of IRFs, on the other hand, tend to be hospital-based units (Table 3-1 and Table 3-2).

Organizational Relationships. Organizational relationships were another area we examined in this work. In looking at the discharges from acute hospitals to first site of PAC, we found that organizational relationships between the acute hospital and the PAC provider varied significantly depending on the type of PAC provider used. For example, in 2006, over 83.0 percent of discharges to LTCHs were to freestanding providers compared to 47.3 percent of discharges to freestanding IRFs. This difference reflects the differences in supply of each type of provider (Section 3.1.3, Table 3-3). We also examined the role of organizational relationships further in the multivariate models to explain variations in episode costs and use (Section 3.9). Acute hospitals that have a subprovider, such as a hospital-based rehabilitation unit or skilled nursing facility unit or which own a home health agency or have a co-located LTCH, had longer length acute stays. However, the availability of these services was not significantly associated with the probability of using PAC. In other words, the PAC providers appeared to be located by hospitals treating longer-stay, possibly sicker populations. But this did not affect whether a patient used PAC, all else equal, such as their severity of illness and precipitating conditions.

Post-Acute Care Episodes. Using the episode definition in our analysis, about 15.0 percent of all beneficiaries had at least one index admission to an acute hospital in 2006.6 Of these, 35.2 percent were discharged to a post-acute site of care for further treatment. Skilled nursing facilities were the most common discharge destination for PAC users (41.1 percent of all PAC users), followed by home with home health care (37.4 percent). Inpatient rehabilitation hospitals and hospital outpatient therapy providers accounted for 10.3 percent and 9.1 percent, respectively of first sites following hospital discharge. LTCHs are the least commonly used PAC provider; only 2.0 percent of all PAC users were discharged to LTCHs (Section 3.2, Table 3-4 and Section 3.7, Figure 3-2).

Type of Condition. The importance of PAC services varies by type of condition being treated in the acute hospital. The most frequent acute hospital admission in 2006 was in DRG 544: Major Joint Replacement or Reattachment of Lower Extremity.7 This DRG represents over 5.0 percent of all hospital discharges in 2006, and 87.0 percent of beneficiaries with this discharge go on to use PAC services. The next most common acute DRGs by volume for PAC users are DRG 089: Simple Pneumonia and DRG 127: Heart Failure and Shock. While these two DRGs account for high numbers of acute admissions, beneficiaries with these conditions are much less likely to use PAC; only one-third of each of these cases will be discharged to PAC. Still, because of the high number of admissions in these categories, the DRGs rank 3rd and 4th in terms of the highest PAC volume (Section 3.3, Table 3-6 and Table 3-7).

Most PAC admissions can be stratified by whether they need PAC for treating medical conditions or functional impairments. Among the medical conditions, such as pneumonia, septicemia, and other infections, beneficiaries are likely to be discharged to SNFs or HHAs where these conditions rank high in the frequency of admissions. Beneficiaries discharged after joint replacements and back problems are much more likely to be discharged to rehabilitation hospitals and skilled nursing facilities. LTCHs are more likely to admit the more medically complex cases whereas IRF patients need to be healthy enough to sustain 3 hours of therapy per day, on average (Table 3-7).

Severity of Illness. Severity of illness typically distinguishes between PAC site of care, all else equal. LTCH admissions tend to have higher severity ratings, whether on the APR-DRG (severity level 3 or 4) or MS-DRG system, whereas SNF and HHA admissions tend to be in severity groups 2 or 3. IRF and outpatient admissions tend to be in severity groups 1 or 2. These differences reflect the expected variation in medical severity for each level of care (Section 3.4, Table 3-8).

Comorbid conditions, as measured by Hierarchical Condition Categories (HCCs), are another indicator of severity of illness or number of complicating conditions. The HCCs were used in these analyses because they to provide a convenient method for collapsing ICD-9 codes into meaningful disease groupings to identify comorbid or complicating conditions. In these analyses, we counted the number of HCCs per beneficiary, regardless of the reason for acute hospitalization. In looking at mean length of stay and payments in the acute hospital, the general trend is that the mean length of stay and mean payment increase with increasing numbers of HCCs. For example, DRG 014 (Stroke), beneficiaries with one HCC had an episode mean length of stay of 82.6 days and mean episode payments of $23,442, whereas, stroke beneficiaries with five or more HCCs had mean episode length of stays of 108.9 days and mean episode payments of $35,659 (Section 3.5, Table 3-12).

Readmission rates similarly vary by the type of condition. Beneficiaries admitted for diagnoses such as pneumonia or heart failure had higher readmission rates compared to beneficiaries with rehabilitative diagnoses. For example, over 43.0 percent of beneficiaries in DRG 127: Heart Failure & Shock had an acute readmission during their episode compared to only 14.3 percent of beneficiaries in DRG 544: Major Joint Replacement or Reattachment of Lower Extremity (Section 3.4, Table 3-10).

Patterns of Care. Considering the patterns of care in the Medicare program and how the mix of services may vary depending on the patients' complexity and the resources available in their local market area can be invaluable. The pattern analysis tables and figures (Section 3.7, Tables 3-19 to 3-22 and Figures 3-2 to 3-7) help us understand the way services are combined to treat individual patients. Of the 35.2 percent of hospital discharges to PAC, 52.0 percent of them go on to use additional services after the first PAC site. The episode payments and length of stay vary extensively depending by the extent to which higher cost institutional services are part of the episode or longer lasting, ambulatory services, such as home health or outpatient therapy. In the most common first site of PAC (SNFs which admitted 41.0 percent of PAC users), average payment per SNF stay was $8,759. For beneficiaries subsequently discharged to HHA, average payments were an additional $3,544. For beneficiaries discharged from SNF to LTCH, average payments were an additional $29,118. Further, seeing how these patterns varied for medical versus rehabilitation cases was also useful for considering expected care trajectories and costs.

Composition of Total Episode Payments. In Section 3.8 we analyzed the composition of Medicare spending on post-acute care episodes by looking at the proportion of total episode payments attributable to each type of service. The episode composition analyses were performed overall, and by severity level for all DRGs and also for DRGs 089: Simple Pneumonia & Pleurisy and DRG 544: Major Joint Replacement or Reattachment of Lower Extremity. Across all DRGs, the largest share of episode spending is for the index acute admission (34.3 percent) followed by spending on SNFs (17.9 percent). Though payments for beneficiaries using LTCHs are very high, the proportion of total episode spending on LTCH services was only 3.7 percent due to the small number of beneficiaries using this service overall. In looking at the distribution of spending by severity level, we see that the proportion of total episode spending on LTCH services increases with increasing severity. In looking at the distribution of payments for beneficiaries in DRG 089 compared to DRG 544, we see that the proportion of spending for SNF is higher for beneficiaries in DRG 089 compared to those in DRG 544, and that the proportion of spending on index acute admissions and IRF services is higher for beneficiaries in DRG 544 reflecting the use of surgical procedures and frequency of use of rehabilitation services for beneficiaries in this DRG (Section 3.8, Figures 3-8 to 3-16).

Physician Use. We also examined physician use during an episode of care (Section 3.8, Table 3-23). Over 90.2 percent of the beneficiaries in our hospital discharge sample had a physician visit in the hospital. Over 68.0 percent had an inpatient consultation, 60.0 percent had an emergency room visit, and 55.0 percent had an office visit sometime during the episode of PAC. The highest payments were associated with hospital visits (over $1,100). The physician visit patterns also differed between the medical and rehabilitation cases. Medical cases, such as DRG 089: Simple Pneumonia & Pleurisy, were more likely to have seen a physician in the ER and more likely to have a NF visit than the patients in DRG 544: Major Joint Replacement or Reattachment of Lower Extremity which were more likely to have fewer visits of every kind.

In sum, this report provides a great deal of insight on the factors associated with using post-acute care and the types of PAC services used. The leading indicator appears to be the patients' medical conditions and severity of illness although availability of alternative services is also critical to service use.

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