Nursing Homes Can Push for Profits Without Compromising Care

09 Jun 2020

About 70 percent of nursing homes in the US are for-profit operations under tremendous pressure from private owners to perform financially. Without a countervailing pressure to meet quality demands, nursing homes can be overly focused on profits at the expense of healthcare outcomes.

Some hospitals, including top academic medical centers such as UCLA, Vanderbilt, and Ohio State, are stepping up to hold these providers accountable by revolutionizing how patients choose post-acute care (PAC). By empowering patients to choose the highest-quality available provider, this new approach rewards providers that invest in quality outcomes with additional patient volume — and more revenue.

Where hospitals are re-imagining PAC transitions, providers prioritizing profits over quality have an opportunity to improve both.

Nursing homes and other PAC providers receive the bulk of their patients through referrals from hospitals. Yet the standard operating procedure for hospital case managers placing patients into PAC is not only cumbersome, it also practically guarantees that patients will never even consider the highest-quality choice of provider. Typically, case managers assemble a list of local providers, often highlighting those affiliated with the hospital, regardless of quality-of-care ratings. They ask patients to choose three to five and, with little data, patients usually choose the options closest to home. Case managers contact only those options. They spend hours awaiting responses from the patient’s initial selections. Communication lags and considerations like insurance coverage, clinical needs, and availability mean the initial search comes up empty, necessitating the process to start all over again. The patient is ultimately discharged to the provider that is first to respond, “yes.”

On average, a discharge to a nursing home or home health agency takes 1.5 days more than a discharge to the home, primarily due to delays in the coordination of the transition. Moreover, the standard approach to PAC transitions results in patients choosing the top-quality available provider only 14% of the time, on average. Thirty percent of patients are readmitted to the hospital within thirty days of release.

Thirty health systems across the country have partnered with Aidin to leverage PAC transition dynamics so that everyone can win. These hospitals used Aidin’s technology-based solution to introduce efficiency and transparency throughout the entire transition process. Every step is securely executed via the technology platform, each tied to a deadline to optimize workflow.

All providers, in- and out-of-network, are managed in a national cloud database. Staff enter all pertinent information in the technology platform, which auto-generates a list of providers that fit the parameters of the case. Staff distribute the referral request to any and all providers, per the patient’s preference, and allow providers to respond with acceptance or declination.

This process creates an open market model for referrals, where all appropriate providers present themselves for the patient’s consideration. Additionally, all providers in the database are tracked against a variety of clinical and operational performance metrics. This timed auction model empowers staff to contact providers with the highest-quality outcomes, and incentivizes providers to perform well, including responding to referrals in a timely manner.

Data show that Aidin hospital clients have a reduced average length of stay, fewer readmissions, and higher patient satisfaction, as well as improved staff experience. Patients also benefit from these results. They’re discharged from the hospital sooner to top quality PAC providers. They’re less likely to be readmitted to the hospital and they have peace of mind knowing that their decisions are fully informed.

Providers win, too. They’re awarded an opportunity to compete for referrals that, historically, they’d never have been sent and they have new clarity as to how they’re being measured. When referral sources reward high-quality providers with more referral volume, providers are incentivized to re-allocate more dollars to clinical outcomes — and fewer to wasteful billboards and radio ads.

Balancing cost and quality in healthcare is nearly impossible — until we allow consumer choice and market forces to take over. For-profit entities will only flourish in the long-term if their financial health is tied to their patients’ health. Therefore, by holding their PAC partners to a hirer performance standard, hospital administrators around the country are demonstrating their commitment to their providers, as well as to their patients.