Will the prospective payment system be as intimidating as it sounds?
Medicare reform means the end of fee for service
Dust from the presidential inauguration parade was still settling when the Clinton administration’s budget announcement hit the home care industry like a runaway float: Home care spending would be cut by $20 billion as a part of Medicare reform.
It means education managers will have to teach their staffs new ways to treat Medicare patients, resulting in major changes in how nurses view their own services, experts say.
One change proposed by the Clinton administration is to switch to a prospective pay system (PPS). This follows the trend set by managed care companies, which are moving the health care industry away from the policy of paying agencies more money for more visits and services.
Instead, under PPS plans, the agency could be paid a lump sum of money per Medicare patient. Managed Medicare plans, which are similar, already cover about 13% of all beneficiaries, according to the Physician Payment Review Commission of Washington, DC. Under these systems, all of the services an agency provides will have to be covered by that lump sum payment. This means the patients will have to become independent more quickly.
"What will happen under prospective payment is we’ll no longer support that patient for weeks and weeks," says Susanne Fairman, RN, BSN, PHN, MBA, CNAA, chief operating officer of Hospital Home Health Care Agency of California in Torrance.
"We’ll probably find more ways to teach the family how to do it and shorten the length of stay in home care or the intensity of service more than the length of stay," Fairman adds. Hospital Home Health Care Agency is a private nonprofit agency with five branches that serve two counties in southern California.
"Also, I think we need to teach our clinicians a new way of communicating with patients to maintain a high patient satisfaction," Fairman explains. (See tips on training staff for PPS, p. 35.)
So why are home care services being targeted for reform?
Home health care is Medicare’s fastest-growing benefit with an average annual growth rate of 35% since 1989, according to the 1996 Green Book. The book is prepared annually by the U.S. House of Representatives’ Committee on Ways and Means in Washington, DC.
Medicare payments for home health grew 53.2% in 1990, about 30% each in 1993 and 1994, and grew by 19.4% in 1995. It’s total payments, which were a scant $1.9 billion in 1985 had grown to $16 billion in 1995, which was 9.4% of total Medicare spending. Also, the Committee on Ways and Means’ report anticipates it will grow to $42.4 million by 2006.1
The expected change to a prospective pay system is no surprise to Fairman and other home care professionals who have been involved with the Prospective Pay Demonstration or the National Medicare Quality Assurance Demonstration. Both projects are studying ways the home health care industry can improve outcomes, resulting in making patients independent more quickly.
The studies have focused on Outcomes-Based Quality Improvement (OBQI) and are funded by the Health Care Financing Administration (HCFA) of Washington, DC. The quality assurance study, which involves 50 home care agencies, is being conducted by the Center for Health Policy Research at the University of Colorado Health Sciences Center in Denver. The project, costing $3.2 million, began in 1995 and will continue through 1999.
It’s sometimes called the OASIS project because it uses a set of data items called the Outcome and Assessment and Information Set, says Kathryn Crisler, MS, RN, project co-director for the Center for Health Policy Research.
The Prospective Pay Demonstration, which involves 91 home care agencies, is being administered by ABT Associates of Boston. The Hospital Home Health Care Agency is involved with this study.
"We are really on the forefront of developing and helping the demonstration project look at what home care is doing for our patients and to be able to measure outcomes," says Jill Sproch, RN, quality improvement manager of Homestaff Health Care Services in Norwalk, CT.
Homestaff Health Care joined the OASIS study in March 1996. Its staff education started seven months before that, Sproch states.
The agency began by creating new assessment forms that asked comprehensive questions about the patient’s health and activities of daily living. The start of care assessment has 15 pages; the follow-up assessment has 10 pages, and the discharge assessment has 11 pages. (See samples of Homestaff’s assessment forms, inserted in this issue.)
The first three pages of the initial assessment cover the patient’s background information, including a health history, immunization records, and high-risk factors. Other pages include checklists pertaining to living arrangements, physical assessment, housekeeping, medications, and equipment and supplies. The other assessments have similar details, which include the OASIS items and the agency requirements.
"Each item requires staff education, and education is going on constantly because there are certain items the nurse might misunderstand," explains Mildred Prosser, RN, MPH, president and owner of Homestaff Health Care Services.
Back to basics
Nurses’ attitudes will play a large role in how they adjust to a change to PPS.
"Believe it or not, it’s just focusing on the basics all over again," Fairman asserts. "The reason I say this is that experienced home health nurses who are deliberate about focusing on making the patient and family independent as quickly as possible will not have a problem with prospective payment."
Prosser says one of the OASIS study’s goals is to see if patients are being admitted to hospitals more often or being discharged faster than they need to be. "It all ties into hospitalization and whether the effect of a faster discharge from the hospital affects the patients’ length of stay also in home care."
An agency might set up its outcomes-type care by setting goals for each patient. The outcome could be that the patient’s care meets 75% of the goals set when the patient was admitted to home care services, Prosser explains.
Each assessment has added 15-30 minutes to the nurses’ time, although when they first began filling out the initial assessment, it took 45 minutes, Prosser says.
At first, the OASIS project required the agency to discharge a patient from home care if he or she had been admitted to the hospital for 48 hours or longer. "Our internal policy was to discharge after two weeks, so we had to change our internal procedure and agree to do that for three years," Prosser says.
This meant nurses would complete the discharge assessment after the 48 hours and then fill out another initial assessment when the patient returned to home care.
Despite the greater amount of paperwork, Homestaff’s nurses have adjusted very well to the changes, she insists.
"I think the staff feel good about participating in this project because they know that all the agencies throughout the country are going to be required to do it soon."
Reference
1. Health Care Financing Administration, Office of the Actuary and Prospective Payment Assessment Commission (1995, 1996), 1996 Green Book, Committee on Ways and Means, U.S. House of Representatives, Washington, DC.
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