In the past six years Phoenix-based Banner Health has seen a marked improvement in outcomes and patient satisfaction for clients receiving home healthcare services. Mary Hahn, director of quality improvement at Banner Healthcare, credits participation in the Centers for Medicare and Medicaid Services’ Home Healthcare Value-Based Purchasing Program model for the change.
“It definitely keeps our eye on the ball,” Hahn told McKnight’s Home Care Daily. “All three of our locations in Arizona have done well this past year.”
Arizona is among nine states that have been participating in a value-based purchasing pilot that CMS launched in 2016 for home healthcare providers. And, if CMS has its way, home care agencies in all 50 states will be reimbursed under value-based purchasing as early as next year. But reviews regarding it are mixed. While many aspects of the program have been positive, there are downsides to it as well, Hahn and others say.
Value-based purchasing rewards agencies based on the quality of care they provide rather than the volume of care. Payment adjustments are determined based on how a home health agency performs against other agencies in its state on a dozen measures that make up a total performance score (TPS). That means agencies that outperform or underperform will receive either an upward payment adjustment or a penalty.
Banner Health’s Payson, AZ, home health agency has consistently outperformed competing agencies in the state and has received increased payments from CMS over the past six years. But agency director Tanya Conway told McKnight’s Home Care Daily it’s been a challenge maintaining high TPS scores.
“We are very small in Payson, in particular, so very small changes can affect our data tremendously,” Conway said. “So we have to be nearly perfect in order to keep our scores up there and receive incentive payments.”
There are other challenges. Among them, not everyone can win with this model. Agencies are scored on a bell curve, with a few high performers, a lot of average performers and a few low performers. That means if an agency improves, but most everyone else improves more, that agency will be penalized. In 2022 the proposed penalty is 8%.
Chris Attaya, vice president of product strategy at the analytics firm Strategic Healthcare Programs, told McKnight’s Home Care Daily that is unfair.
“If these agencies are all contributing to savings and a lot of that savings is coming from fewer hospitalizations or fewer skilled nursing costs then reward them, don’t penalize them,” Attaya said.
Both Attaya and Conway said there are ways home healthcare firms can thrive under value-based purchasing. Attaya recommends agencies focus attention on quality measures where they underperform.
“They should look at the ones where they have the greatest opportunity to impact their overall TPS score. If that is hospitalizations, great,” Attaya said.
Hospitalizations account for a quarter of TPS and were a trouble spot for Banner Health’s Payson office. So Conway and her team developed a program that identifies patients at risk for hospitalization and encourages those patients to seek help from Banner Health staff first when they have health issues.
“We had a 20% hospitalization rate before value-based purchasing and we’ve been able to bring that down into the single digits,” Conway said.
CMS considers the value-based purchasing pilot a success. It cites a 4.6% improvement in Medicare quality scores between 2016 and 2018 and annual savings of $141 million to Medicare. While it generally celebrates the program, the National Association for Home Care & Hospice has asked CMS to delay the national rollout of value-based purchasing so agencies can make operational reforms necessary to guarantee success under the program. It also wants CMS to adjust the penalty rate and establish a technical expert panel to evaluate the proposed measures to ensure they consider the full scope of the patient.