The value equation – the major market shift
The fundamental shift which is occurring in healthcare at large, and post-acute care, is placing cost and quality in the same equation – this is value.
Outcome / Price = Value
In a period of market decline such as we are now experiencing, post-acute care providers must be involved in this shift. Providers that do not learn how to participate will be left behind – and this is the point of looking at transitions of care from a marketing perspective.
Historical vs. contemporary
Cost and quality have historically been disconnected in transitions of care from one setting to another. Everyone is aware of the discontinuity between and among care platforms, but unless an individual provider was affected, there was no attempt at coordinating care; there were no incentives.
The scale of this “frequent flyer” problem is staggering.
- 20% or more of patients discharged from acute care hospitals are readmitted
- 40% of these are unnecessary or inappropriate
- The cost of these avoidable readmissions is $3.39 billion
CMS is addressing this, some would say bluntly, by penalizing hospitals for avoidable readmissions. And for all but the most affluent academic medical centers, the penalties being assessed are financially difficult.
What’s In It for Me? (WIFM)
Skilled nursing centers have not traditionally attempted to manage challenging clinical situations, and have not hesitated to return patients to the hospital. “When in doubt, ship ‘em out” has been a truism. And because of many patients’ Medicare eligibility, hospitals have been complicit – readmission starts the utilization clock ticking all over again.
Now, however, when patients are sent back to the hospital, not only are their potential financial risks to the hospital and the SNF, there are negative consequences to the willingness of the hospital to continue referring patients to that SNF. The hospital uses the “observation” status to avoid readmissions penalties, and because of this, the Medicare clock is not reset for the SNF. So the “what’s in it for me” (WIFM) for collaborating has become compelling for both the hospital and the SNF.
Marketing with Data
The best marketing tool for SNF’s to position themselves with referring hospitals is rapidly becoming data. The fundamental principle is to demonstrate to your referring “partners” that you understand their challenges and you are taking concrete, measurable steps toward relieving their pain, which means reducing or eliminating unnecessary hospital readmissions.
The best place to start is with data about readmissions rates. Since there are at least two parties in this scenario, the hospital and the SNF, it is necessary to look at readmissions rates for both. Among skilled nursing centers, we encourage our clients to carefully track the number, percentage and types (diagnoses and other demographics) of patients being re-admitted.
Next, in your marketplace area, look at the readmissions rates in the critical diagnostic categories for each of the upstream referring hospitals from which you currently receive patients or from which you hope to receive patients. This will provide you with insight into the clinical categories where you’re referring hospitals excel, and where they may have challenges. For this analysis, you can use the hospital compare website hosted by CMS (www.medicare.gov/hospitalcompare/search.html).
Searching for hospitals in your location, you can compare their arthroplasty readmissions rates. As post-acute care providers, can we lower the readmissions rates for one of these hospitals, offering it competitive and financial advantages?
In another marketplace, comparing three hospitals you may find that one has below standard results in myocardial infarction. As post-acute care providers, can we develop a “solution” to lower the readmissions rates for this hospital, offering it competitive and financial advantages?
Start the Conversation
Many SNF’s have already initiated clinical reviews of transitions that went well and those which went poorly. Wherever possible convert these reviews into measurements/metrics. As was said in a previous article, the representatives of each of the providers will need to have a working familiarity with process mapping, root cause analysis and conflict management. (Yes, there will be conflicts!)
The marketing conversation with your upstream referring hospitals begins with your sharing the analysis you conducted and by starting the conversation, “we not only understand your pain, Ms. Hospital Administrator, we have analyzed the reasons and can show you how to measurably reduce your risks and penalties.” This is an opening which is certain to gain the attention of the vast majority of hospital executives.
This is the beginning of a fundamental change in how post acute healthcare is viewed. Call or email me – I would love to be part of the conversation!
Copyright © 2022 Stackpole & Associates, Inc. Brookline, Massachusetts
Irving Stackpole is President of Stackpole & Associates, marketing, research & training firm. Irving can be reached at 1-617-739-5900, ext. 11, by email at firstname.lastname@example.org, or follow Irving at www.StackpoleAssociates.com