Since 2009, the days Medicare beneficiaries have spent in skilled nursing facilities (SNF) have fallen by 15 percent on a per capita basis, which may be the result of value-based payment models leading hospitals to rely more on observational stays which wouldn’t make patients eligible for a SNF.
The Avalere Health analysis looked at Medicare Part A data for national inpatient discharges and SNF admissions and length of stay from 2009 to 2016. During that time period, the number of SNF days per 1,000 Medicare beneficiaries fell from 1,808 to 1,539.
“The economics of post-acute care have been fundamentally changed as Medicare shifts its payment approach to capitation, bundles, and pay for value,” Avalere president Dan Mendelson, said in a press release. “Fewer patients are being admitted to the hospital, as payers and risk-bearing providers seek to shift care to lower-cost settings.”
What appears to be driving this change is shifts in inpatient hospital care. Medicare covers up to 100 days of SNF care, but to be eligible, beneficiaries must have spent at least three days as an inpatient admission before being sent to a SNF. Since 2009, Avalere found that per capita hospital discharges have dropped by 17 percent, while observation stays—which wouldn’t make patients eligible for a SNF admission—have increased.
Hospitals which are more aggressively transitioning to value-based care may be shifting their discharges from SNFs to home health providers. Avalere, however, didn’t find a significant shift in the proportion of discharges to SNFs relative to home health or other post-acute care settings and the average length of stay in SNFs remained steady at 24 days throughout the study period.
This would point to more frequent use of observation stays as the key driver, which in turn is motivated by Medicare models which penalize readmissions and add “scrutiny of short inpatient stays.” For the SNFs themselves, however, there may not be much of a cause for concern in the short term.
“Continued population growth is expected to counteract the utilization declines, but there appears to be a steady shift in how Medicare beneficiaries are using inpatient services and skilled nursing care,” said Erica Breese, director at Avalere.
John joined TriMed in 2016, focusing on healthcare policy and regulation. After graduating from Columbia College Chicago, he worked at FM News Chicago and Rivet News Radio, and worked on the state government and politics beat for the Illinois Radio Network. Outside of work, you may find him adding to his never-ending graphic novel collection.