Early into the Trump presidency and health care/health policy is front and center. The first "Obamacare repeal and replace" attempt crashed and burned. The upcoming roll-out of the next round of bundled payments (cardiac and femur fracture) is delayed to October from the end-of-March target date. Logically, one can question is a landscape shift forming? Doubtful. Too many current realities such as the need to slow spending growth plus find new and innovative population health and payment models are still looming. These policy realities beget other realities. One such reality is that hospitals and health systems must find ways to partner with and integrate with, the post-acute provider industry.
Over my career, I have done a fair amount of merger and acquisition (M&A) work, including:
Continuing care retirement communities (CCRC)
Skilled nursing facilities (SNF)
Home health agencies (HHA)
While each deal has many nuances and issues, none can be as confusing to navigate as the federal payer issues—specifically, the provider number. For SNFs, HHAs, and hospices, an acquisition that is not properly vetted and structured can have severe repercussions post-closing, if provider liabilities existed pre-close and were unknown and/or unknowable. Even the best due diligence cannot ferret out certain provider number–related liabilities.
The Medicare provider number is the unique reference number assigned to a participating provider. When initially originating as a provider, the organization must apply for provider status, await accreditation (for SNFs, this is done via a state survey; for HHAs and hospices, it is via private accreditation), and then get ultimate approval by Medicare/HHS. As long as the provider that has obtained the number remains in good standing with CMS—meaning it hasn’t had its provider status/agreement revoked—the provider may participate in, and bill, Medicare and Medicaid (as applicable).
Under a final rule published on January 12, 2017, by the Department of Health and Human Services (HHS) Office of Inspector General (OIG), the agency’s authority to exclude facilities from Medicare funding was expanded to include any individual or entity found guilty of audit obstruction. Prior to this rule, exclusion authority was limited to those convicted of obstructing criminal investigations. The rule became effective on February 13, 2017.
Although the main purpose of the MDS is to assist the clinical team to provide accurate, resident-centered care, the MDS has evolved to become the basis for Medicare and Medicaid state case-mix payments. The MDS is used as a data collection tool to classify Medicare residents into resource utilization groups (RUG). The RUG scores as reported in MDS items Z0100 or Z0150 are then used to bill Medicare or Medicaid.
There are few times during a SNF stay that a resident is more vulnerable than those first several days. Often, a bad transition process only serves to exacerbate those vulnerabilities, leading to complications or rehospitalization.
In fact, a study published in the Journal of Post-Acute and Long Term Care shows that poor coordination between hospitals and postacute care providers can have devastating consequences for residents, particularly those with higher acuity.