Long-Term Care Providers ‘Clobbered’ by Managed Medicare

While the skilled nursing industry worried about the rise of accountable care organizations (ACOs), managed Medicare plans slowly established a firm foothold that isn’t going anywhere soon.

“The growth of ACOs and bundled payments has kind of leveled off,” Jill Kreuger, president and CEO of pharmacy and rehab solutions provider Symbria said at LeadingAge Illinois’s annual conference in Schaumburg, Ill. last week. “But what I have seen, for the first time in my life here, is rapidly accelerating managed care penetration.”

According to Krueger, one Symbria therapy client told her: “We’re just getting clobbered by managed care.”

 Managed Medicare uptake has reached about 33% nationwide, with the Congressional Budget Office predicting increases of about 4% per year. But Avalere Health, a Washington, D.C.-based health care consulting firm, projects a faster rate of 6% to 7% per year — making 50% penetration a near-term possibility.

“Fifty percent of your potential business in the post-acute care space is being managed by somebody who really cares about the bottom line — and won’t be afraid to try to squeeze people,” Niall Brennan, president of the Health Care Cost Institute, said at another industry event last month.

Managed Medicare has accelerated the narrowing of networks in skilled nursing, Krueger said, in which acute providers refer their patients to a smaller and smaller bunch of skilled nursing facilities.

“The top five nursing homes are getting more and more patients, and the others are getting fewer and fewer,” she said.

Krueger emphasized the importance of improving outcomes and bringing the data to prove it, as SNFs compete against each other for shrinking hospital referrals.

“Managed care, what do they care about? Readmissions, length of stay — because the managed care players get a flat amount,” she said. “The single most expensive thing you can do is send someone back to the hospital. Bar none, that’s where the money is.”

– Skilled Nursing News

Read the full article here.