Computerized outcomes measures crucial to please JCAHO, HCFA, HMOs
Benchmark to balance the needs of accreditors, payers
Perhaps you’ve computerized parts of your patient record, or automated your billing services. But if your agency isn’t also collecting and measuring outcomes with a computerized system, or affiliated with one, you may have trouble staying in business in the future.
In our January 1997 issue, Homecare Quality Management reported that the race to track outcomes and report them to payers in a standardized and specific way has heated up for home care. (See story in HQM, January 1997, p. 1.) This month, we show you the factors that will push you further into the outcomes automation foray. Consider:
• Item: The Joint Commission on Accreditation of Healthcare Organizations (JCAHO), based in Oakbrook Terrace, IL, will require accredited organizations to incorporate an outcomes measuring system into their operation procedures before the end of 1998. JCAHO mandates that the required outcomes data be transmitted to it electronically from an approved measuring system. (See related bulletin on Joint Commission-approved systems, inserted into this issue.)
• Item: A prospective payment system is on the horizon for home care as Congress tackles Medicare reform this year. This means home health care providers must be able to track their costs and ensure they achieve the desired outcomes before flat-rate reimbursement money runs out.
• Item: In some markets, as much as 40% of home health is reimbursed by managed care companies, and the percentage is growing daily across the country. Medicare HMOs represent one of the fastest-growing health care reimbursement methods in the country. MCOs will want cold, hard facts about what outcomes you can produce and for how many dollars before they contract for your services.
Of immediate concern is the JCAHO mandate that hospital and long-term care facilities contract with an outcomes system approved by JCAHO by the end of this year in order to receive accreditation.
ORYX: The Next Evolution in Accreditation was announced by JCAHO president Dennis S. O’Leary, MD, at a news conference Feb. 18.
Initially, organizations must track at least two indicators that cover at least 20% of their patient populations. The number of indicators and percentage of patients covered will increase annually, reaching 100% of patients in five years.
Organizations accredited under home care, behavioral health care, clinical laboratories, and ambulatory care must choose a performance measuring system that meets JCAHO criteria by Dec. 31, 1998. They will be expected to collect the data during 1999 and to begin submitting it to the JCAHO by the first quarter of 2000. The organizations will be expected to take the outcomes data they receive and use it in the quality improvement process. Eventually, the accrediting organization will be able to review your performance-measuring data on a continuous basis, and to make the accreditation process more of an ongoing process instead of something that happens only every three years, says Deborah Nadzam, PhD, RN, director, Indicator Measurement of the Joint Commission.
When the new mandates take effect, JCAHO will not take outcomes measuring information directly from the organization seeking accreditation. Rather, it will receive the data electronically from the systems that meet JCAHO criteria. The vendors will send data electronically to the JCAHO on a quarterly basis.
This means your organization must be aligned with one of the systems that meets the criteria, or you must get your proprietary system approved. Hospitals and long-term care organizations replying to a survey last summer reported an average start-up cost of less than $10,000 for a performance-measuring system, and a cost of less than $11,000 a year to maintain it, the JCAHO announced.
The Joint Commission’s Board of Commis sion ers has approved 60 performance measure systems from the 71 that submitted screening criteria last fall. This includes performance measures for all aspects of health care now accredited by JCAHO, including 19 home care systems vendors.
The Joint Commission intends to add other outcomes measuring systems to its list of approved systems on an ongoing basis, O’Leary says. Applications from another 20 systems will be considered at the JCAHO’s Council on Performance Measures meeting in April.
Profiles of all 60 participating measuring systems will be distributed in mid-March to all accredited hospitals and long-term care providers, O’Leary says. To meet JCAHO’s initial screening criteria, vendors were required to demonstrate the following:
• presence of performance measures;
• technical capability for data collection and transmittal;
• checks for accuracy and reliability;
• strategies for risk adjustment and severity adjustment;
• feedback to participating health care providers;
• collection of data and measures that are relevant to the accreditation process.
A field readiness survey last summer showed that 70% of all hospitals and 33% of long-term care providers responding already have a performance measurement program in place, and are measuring an average of 10 to 24 indicators, O’Leary says.
In a few years, when JCAHO has compiled enough data to make a decision, the Council on Performance Measure will probably identify common outcomes measures that must be embedded in all outcomes measuring systems, O’Leary says.
When home health agencies scramble to sign up for a JCAHO-approved outcomes system, they shouldn’t lose sight of the fact that ultimately they are going to have to please whoever is paying their bills, warns Michael Murer, JD, executive vice president of Murer Consultants, a Joliet, IL-based health care consulting firm.
"Providers must balance the needs of the accreditation agencies with the needs of payers. You need the kind of data that tells you how your business is functioning clinically and financially," adds Carolyn Sipes, RN, MSN, CNS, DNSc(C), president and chief executive officer of the Center for Healthcare Outcomes, an outcomes research and development firm in Littleton, CO.
Accreditation agencies are looking for outcomes measures that reflect whether your interventions are appropriate and effective. But the payers want to know the cost, she adds.
"The home health industry is going to have to rapidly shift its service provision mindset from that of generating revenue to containing costs. In a cost-based system, there has not been the demand to manage Medicare cases in the most cost-effective manner, but under a prospective payment system it’s going to be critical," says Chris Hagen, PhD, president of Healthcare Consultants Network in San Diego.
Home health providers can expect the same dramatic changes that acute care hospitals saw when HCFA shifted to diagnosis-related group (DRG) reimbursement, says Jeff Souza, RN, president of Healthcare Quality Management of Yuba City, CA.
"The issues are all the same. Accountability and productivity have come to health care," he notes.
Home health agencies have been able to charge for a lengthy admissions process on a cost basis. Under all of the reimbursement changes under consideration, that no longer will be the case, Sipes points out.
Providers are likely to receive reimbursement in a set amount per visit, or a set amount for an entire episode of care. This means you’ll lose money on a four-hour nursing evaluation visit, she says.
"These kinds of things are going to be monitored. People need to realize that there is going to be a limited pot of money," she adds.
As acute care lengths of stay are shortened, the need for post-acute services is going to increase, and there is going to be increased competition among home health agencies, day treatment centers, and outpatient programs for a slice of the post-acute business, Murer predicts.
Payers are going to look for providers that can produce the best outcomes for the lowest costs, he says. "Whoever has the best statistics is going to be a godsend to the managed care industry."
[Editor’s note: For more information on the JCAHO’s requirements, call its special telephone number: (630) 792-5085, or visit the JCAHO web site at http://www.jcaho.org.]
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