Using big data to optimize post-acute care
Insurers using value-based payment models pay healthcare providers based not only on the quality of care they provide inside the hospital, but also on what happens after patients leave the hospital.
Until recently, however, insurers and providers did not have good ways of measuring the cost-effectiveness of postacute-care providers, and patients lacked clarity on what to expect after they were discharged. A 2013 Institute of Medicine report found that 73% of regional variations in Medicare spending were linked to differences in post-acute care.
Brentwood, Tenn.-based naviHealth is trying to change that by providing data and clinical expertise to help direct patients to post-acute providers with the best outcomes and lowest costs. It has developed an outcomes prediction tool called LiveSafe, which has compiled data from 800,000 episodes of care. Also, naviHealth assumes financial risk along with its clients, employing care coordinators to help patients choose the most appropriate post-acute-care sites.
“We created an economic model to take on the entire post-acute-care episode,” said CEO Clay Richards. “It’s leveraging the technology and analytics to create individual care protocols.”
The company, founded in 2011 with the backing of private equity firm Welsh, Carson, Anderson & Stowe, has clients that include health plans and provider systems such as Kaiser Permanente, Dignity Health and Highmark. Using LiveSafe, naviHealth can create personalized care plans for patients, said Dr. Clay Ackerly, naviHealth’s chief clinical officer. “It really is a gamechanger for discharge planning,” he said.
Last month, naviHealth sold a 71% stake of its business, for $290 million, to Cardinal Health, which has the option to acquire the full company within four years.
Earlier this year, naviHealth was selected as a “convener” for Model 2 of the CMS’ Bundled Payments for Care Improvement initiative, which covers episodes of care lasting up to 90 days after discharge. NaviHealth is tasked with establishing postacute-care protocols for the initiative and providing data to participating hospitals to enable them to provide care within budget.
The company is now working with 75 hospitals in 24 states on the bundling initiative. It also has a national partnership with IPC Healthcare to provide services at a separate group of hospitals. The work on bundling began in April, so it’s too soon to assess results. But the company says it has evidence that its technology has reduced hospital readmissions, improved patient outcomes and saved money.
Priority Health, a Grand Rapids, Mich.based health plan that’s part of Spectrum Health, launched a post-acute-care management plan for its 110,000 Medicare Advantage members in January 2014 using LiveSafe. NaviHealth’s benchmarking data showed that Priority already had a low level of post-acute-care utilization—975 skillednursing-facility days per 1,000 members. But the health plan thought it could do better.
Priority embedded a discharge manager in its hospitals to ensure patients were sent to the most appropriate post-acute-care site. The naviHealth database also informs patients and their families about typical outcomes for patients with similar conditions.
“What had been missing in the past is that (patients and families) didn’t know what to expect when they got to the nursing home,” said Dr. Jay LaBine, Priority Health’s chief medical officer. “This will allow people to make a more informed decision.”
The initiative has led to a further 15% decrease in SNF days per 1,000 beneficiaries, and also cut the average length of stay, LaBine said. Overall, Priority has seen a 13% reduction in its per-member-per-month costs in its Advantage program. Moreover, Priority has directed patients to high-performing post-acute-care facilities, while holding lower performers accountable.
NaviHealth’s Richards acknowledged that his company’s model creates winners and losers among post-acute-care facilities. “Some providers that we work with see this as an opportunity to really differentiate themselves from their competitors,” he said.
Richards said the trend to combine payments for acute and post-acute care will heighten the focus on the cost-effectiveness of post-acute providers. He cited the CMS’ July proposal to launch a mandatory Medicare bundled payment program for hip and knee replacements in 75 markets, holding hospitals accountable for outcomes up to 90 days after discharge.
“We think hips and knees is the first wave and that will be followed by other conditions,” Richards said. “We want to be the first mover to take advantage of that when it happens.”