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Changes in the Long-term Care Hospital Patient Population following the 2013 Bipartisan Budget Act

Amy Kandilov, Terry Eng, Sarra Sabouri, Tri Le, Karen Reilly, Charles Padgett, Lorraine Wickiser, Alan Levitt

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Disclaimer

• The statements contained in this presentation are solely those of the

authors and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid Services.

• Funding for this presentation came from internal support from RTI

International.

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Introduction: What is an LTCH?

• Long-term care hospitals (LTCHs) provide hospital-level care for

patients who may have multiple serious conditions or illnesses

– patients receive care in an LTCH for an average of more than 25 days – patients are often transferred from an acute hospital after multiple days in

an intensive care unit

– common LTCH services include liberation from mechanical ventilation,

complex wound care, and comprehensive rehabilitation.

• There are about 426 LTCHs across the U.S.
• In 2015, Medicare spent $5.3 billion across 131,000 patient stays, for

an average of over $40,000 per stay.

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Introduction: Medicare Payments for LTCHs

• Medicare payments to LTCHs are based on a prospective payment

system, meaning that LTCHs receive a pre-determined payment based on diagnosis and procedure codes.

• Section 1206 of the Bipartisan Budget Act (BBA) of 2013 introduced

significant changes to the Medicare payment system for LTCHs, starting in October 2015.

• About sixty-five percent of LTCH patient stays are paid under

Medicare’s fee-for-service (FFS) coverage.

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Introduction: Changes in Medicare Payments for LTCHs

Prior to October 2015, all patients in LTCHs received standard rate payments (subject to payment reductions for short stays). Starting in October 2015, Medicare FFS patients in LTCHs must meet the following criteria in order to receive standard rate payments:

• must be directly admitted from an acute hospital; and
• must have spent 3 days in the intensive care unit in the acute

hospital prior to LTCH admission; or must have an LTCH diagnosis that includes more than 96 hours of ventilator care; and

• must not be primarily receiving rehabilitation or psychiatric care.

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Introduction: Changes in Medicare Payments for LTCHs

• Patients who do not meet these criteria will receive

much lower ‘site-neutral’ payments. The site-neutral payment is defined as the lesser of:

1) 100 percent of costs, or 2) the comparable per diem amount that would be paid to an acute care hospital

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Research Objective

• The purpose of this research was to analyze the initial impact of the

BBA payment change on the patient population in LTCHs using the LTCH Continuity Assessment Record and Evaluation (CARE) Data Set.

• The LTCH CARE Data Set collects assessment data on all LTCH

patients at both admission and discharge, for the purpose of creating publicly-reported quality measures

• Collection of assessment data on the LTCH CARE Data Set began

in October of 2012.

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Study Design

• Difference-in-differences regression comparing Medicare FFS

patients discharged before and after the October 2015 payment change with a comparison group of patients with all other types of insurance

• Outcomes of interest included:

– Length of stay – Discharge destination (short stay acute care hospital, skilled nursing

facility, expired, etc.)

– Functional ability at admission (mobility) – Skin integrity (pressure ulcers) at admission, as defined by the presence of

• ne or more pressure ulcers stages 2-4 or unstageable

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Population Studied

• Admission and discharge assessments from the LTCH CARE Data

Set were matched to create patient stays

• All patients discharged between October 2014 and July 2015 (FY

2015) and between October 2015 and July 2016 (FY 2016)

• All LTCH facilities that had at least one discharge in every quarter of

the time frame

• Total of 288,649 patient stays in 394 LTCH facilities
• Average facility-level discharge count for 9 months fell from 369

discharges per facility in FY 2015 to 363 discharges per facility in FY 2016

FY 2015 FY 2016 Medicare FFS 94,121 (64.7%) 92,833 (64.8%) All other Insurance 51,328 (35.3%) 50,367 (35.2%)

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Distribution of insurance types in LTCHs in FY 2015

43% 20% 7% 10% 1% 11% 8%

Medicare FFS Dually eligible (Medicare FFS) Medicaid Medicare Managed Care Other governement insurance Private insurance Self-pay, other insurance, unknown

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Change in the Length of Stay for Medicare FFS Beneficiaries, FY 2015 and FY 2016

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Change in the Length of Stay for All Other Insurance Types, FY 2015 and FY 2016

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Change in Incidence of Pressure Ulcers at Admission

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FY 2015 FY 2016 Difference Medicare 39.44 40.32 0.88 All Other Insurance 33.39 34.92 1.53 Difference-in-Differences

• 0.65
• Pressure ulcer measure defined as having one or more of one of the

following types of pressure ulcers on the admission assessment:

• Stage 2
• Unstageable due to dressing
• Stage 3
• Unstageable due to eschar
• Stage 4
• Deep tissue injury
• There was no significant difference-in-differences effect in the likelihood of

having one or more pressure ulcers at admission

Discharge Destination for LTCH patients

All other Insurance FY 2016 Medicare FFS FY 2016 Difference-in- Differences Community 34.29 30.54 1.06*** Skilled Nursing Facility 30.40 41.10

• 0.35

Hospital/Emergency Department 18.24 14.17

• 0.26

Long-term Care Hospital 0.41 0.43 0.00 Inpatient Rehabilitation Facility 10.02 7.04 0.25 Other facility 0.98 1.48

• 0.07

Hospice 2.36 3.01

• 0.13

Against Medical Advice 1.34 0.91

• 0.31***

Other 1.95 1.32

• 0.20

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NOTES: *p<0.05; **p<0.01; ***p<0.001

Change in Independence in Functional Mobility Data Elements at Admission

• Independence in the function data elements was defined as

– Patient completes activity with no assistance from a helper – Patient completes activity with only set-up or clean-up assistance from

helper

– Helper provides verbal cues or touching/steadying assistance as patient

completes activity

• The percentage of LTCH patients who could independently complete

these activities on admission declined between FY 2015 and FY 2016, but for the rolling and sitting data elements, the decline was larger for the Medicare patients subject to the payment changes.

All other Insurance FY 2016 Medicare FFS FY 2016 Difference-in- Differences Rolling left and right 21.11 21.23

• 1.55***

Sitting on bed to lying 17.87 17.19

• 0.99***

Lying on bed to sitting 21.12 17.18 0.18

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NOTES: *p<0.05; **p<0.01; ***p<0.001

Principal Findings

• There was no change in the proportion of LTCH patients who were

covered by Medicare fee-for-service

– 65% of LTCH patients were Medicare FFS beneficiaries before and after

the payment change

• Among all LTCH facilities, the payment changes were followed by

– Decline in the facility-level number of discharges per day

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Principal Findings

• Among Medicare fee-for-service patients, the payment changes were

followed by these statistically significant changes

– Shorter average length of stay (0.9 days shorter)

• Shift away from 26-50 day stays to 0-25 day stays

– More likely to be discharged into the community (1.06 percentage points) – Less likely to leave Against Medical Advice (0.31 percentage points) – At admission, less likely to be independent in functional ability to roll from

side to side and ability to move from sitting on side of bed to lying flat

• Could indicate a shift toward more ventilator patients following the payment
• change. Among Medicare FFS patients discharged from an LTCH in Q4 2016,

17% were admitted with invasive mechanical ventilation.

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Principal Findings

• There were no significant changes in

– the likelihood of any of the other discharge destinations; – the likelihood of having at least one Stage 2, Stage 3, Stage 4 or

unstageable pressure ulcer; or

– the likelihood of being independently able to move from lying on the back

to sitting on the side of the bed

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Implications for Policy, Delivery, or Practice

• The changes in the length of stay, while significant, were not large.

This could be a reflection of the way that LTCH lengths of stays are constrained both by short-stay outlier payment penalties and the 25- day rule

– LTCH stays below a certain length of days which varies across diagnoses

receive significant payment penalties

– LTCHs are required to maintain an average length of stay of 25 days for

their Medicare FFS patients

• There is some early indication that, following the payment changes,

Medicare patients are less independent in their functional abilities than they were prior to the BBA payment change

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Implications for Policy, Delivery, or Practice

• The changes in Medicare payments for LTCH patients are expected

to continue to have a significant impact on the LTCH patient population.

• This first look at how the LTCH patient population is changing will

help providers better understand how their patient populations and thus their resource needs will likely evolve.

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More Information

Terry Eng, PhD, RN Program Manager Research Public Health Analyst 781.434.1751 teng@rti.org Amy Kandilov, PhD Senior Research Economist 919.541.7111 akandilov@rti.org

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