Doing more with less: Facilities cope with declining reimbursements
IDS, quality measurement approaches being used
Editor’s note: If members of the rehabilitation industry were to adopt a theme song, it would have to be a blues tune addressing the woes of shrinking reimbursements. The one-two punch of declining commercial reimbursement due to cutbacks from managed care organizations and the government’s move toward a prospective payment system (PPS) for Medicare services (see p. 48 for an update on PPS activities) have left many organizations looking for ways to cope with revenue declines. In this special report, Rehab Continuum Report looks at techniques some organizations have used to ensure quality of care and market competitiveness remain strong despite these payment challenges.
Dorothy in "The Wizard of Oz" may have said it best: "We’re not in Kansas anymore." Applying that philosophy to the current winds of change sweeping the rehab industry, managers are rethinking the way they do business, creating strategies to prosper in an environment of declining reimbursements, and educating staff to adapt to these changes. There is one caveat to this strategic planning, however: Changes must be made without sacrificing quality of patient care.
"The way we do business now and the way we deliver care now is not going to be viable under [a system of] prospective pay," summarizes Frank Wong, MD, medical director of the rehabilitation unit of Legacy HealthCare in Portland, OR, and a member of the governing body of the American Hospital Association’s long-term care section.
Wong and other rehab leaders interviewed by Rehab Continuum Report sounded a common theme in how their strategic planning will address the challenges of meeting reimbursement declines from managed care organizations and from the Health Care Financing Adminis-tration (HCFA) once the government moves to a prospective payment system in October 2000:
• Many are pursuing participation in an integrated delivery system by thinking of rehabilitation as part of a continuum of care rather than just care received in a hospital setting.
• Leaders are devising strategies to make therapists and other clinical staff more productive.
• Institutions are determining how to define quality of care and are establishing guidelines for desired outcomes.
• Some organizations are pursuing business with consumers who are paying for rehab services directly out of their own pockets and thus are sidestepping cutbacks among commercial and government payers.
Wong’s experience at Legacy HealthCare is a case in point. In 1991, the hospital he worked for merged with a Portland health care system consisting of four hospitals, an organization his hospital had competed with for the past 20 years. As a result of market competition and reimbursement cutbacks, the combined system, which grew to five hospitals with the addition of Wong’s, has shrunk from 66 hospital rehab beds to 33. "I’m totally convinced that we would not have survived at all if we hadn’t integrated," he says.
The Legacy system includes four hospitals (one has closed since the merger) with inpatient and outpatient care facilities, two skilled nursing facilities, and a home health service.
If the cultural changes involved in merging systems represent round one of Wong’s experience in adapting a rehab environment to change, then the impending switch to a prospective payment system represents round two. Legacy’s senior management team, which includes Wong, is in the midst of a planning process that is re-evaluating its current way of doing business and providing patient care.
Legacy has stressed staff communications throughout the process, Wong says. One element that received particularly positive feedback from staff was a series of internal newsletters explaining reimbursement changes. The first newsletter explained how the reimbursement system works, including a definition of how rehab hospitals are reimbursed through the Tax Equity and Fiscal Responsibility Act. The second explained reimbursement changes that will be implemented as a result of the Balanced Budget Act of 1997, while the third explained the move to prospective pay.
Legacy has created two committees as part of its strategic planning process, Wong says: a rehab operations council, which deals with administrative issues, and a rehab standards and quality council, which will look at quality care and outcomes.
In a managed care environment that demands clinicians see larger numbers of patients per day, time spent in meetings means time away from patient care. As a result, Legacy asked clinical staff to document every meeting they attended. Managers studied the list to determine if each meeting added value to the quality of patient care delivered and, in some cases, decreased the frequency of the meetings or shortened the list of required attendees.
The standards and quality council will investigate quality of care and the possibility of incorporating clinical pathways into rehab treatments, Wong says.
One organization already making use of clinical pathways is Crozer Keystone Health System in the Delaware County area of Pennsylvania. The organization’s outpatient therapy department recommends its therapists use the Guide to Physical Therapist Practice published by the Alex andria, VA-based American Physical Ther apy Association (APTA). The guide lists preferred practice patterns, desired outcomes, and interventions for specific types of cases, although APTA stresses in the manual they are not to be applied as clinical guidelines.
Crozer managers used the guide to help establish procedures for common diagnoses their outpatient therapists handle, and they keep these guidelines in a notebook for outpatient therapists and other team members to use, says Bonnie Breit, administrative director of rehab services for Crozer.
Crozer also uses weekly team meetings of therapists, assistants, and other rehab staff to update its operations manager on the clinical outcomes and expected number of visits for each therapy patient, Breit says. "We monitor the number of times the patient has been seen by a physician, how many visits they’ve had . . . literally a clinical and time review weekly for every patient."
Get payers involved
At the Rehab Institute of Chicago, leaders have published outcomes studies on specific patient populations, such as care for stroke patients. The organization has begun to approach payers about conducting jointly sponsored outcomes studies to demonstrate clinical outcomes and patient and family satisfaction, says Wayne Lerner, chief executive officer. "What’s missing from our equation now is a conversation between clinical institutions and their medical staffs and payers. What we’re trying to do . . . is to get the attention of some of the payers to work with us on looking at the long-term impact of short-term adjustments in payment. In the old days, when acute care was going through changes, people would ring their hands and talk about anecdotes," Lerner says. "The world has hardened, and anecdotes will not come into play. We’re trying to collect facts and add anecdotes to these facts." (For more on how institutions use outcomes data, see story, p. 47.)
Most facilities interviewed by Rehab Continuum Report have not resorted to clinical staff layoffs, but they have had to do some creative juggling. The Rehab Institute of Chicago, for example, has chosen to reduce its management team rather than institute cutbacks in its clinical staff.
Because the patient load was expected to decline for the rehab unit due to time constraints or denials by managed care organizations, Breit shifted her clinical staff to different areas as patient loads shift. "That’s part of the luxury of being part of an integrated delivery system," she says. "If I’m light in inpatient [rehab], I can move therapists to outpatient." This option has helped her maintain staff rather than having to lay them off.
She also has invested time in greater staff education to make clinicians aware of the realities of practicing in an environment increasingly governed by the requirements of managed care organizations. "Quality doesn’t necessarily mean quantity, and that’s an important delineation," she says. "Certain diagnoses require more quantity [than others]; you can’t teach a new spinal cord injury patient everything in two weeks, but you may be able to cover those goals in that time period with a total hip replacement patient."
Breit also reminds her therapists that rehab is about teaching patients to do things for themselves. "Therapy is not just the results of the therapist doing something to the patient. . . . It’s the patient taking an active role in their recovery. We’re making that part of our treatment approaches on a regular basis and earlier."
The Rehab Institute of Chicago also is thinking outside the box by taking its therapists outside the hospital walls. The institution has entered into a series of outside partnerships with other acute care institutions in which staff of the Rehab Institute provide rehab services on the partner hospital’s campus. Profits and expenses are split 50/50, Lerner says.
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