Nursing home case-mix reimbursement in Mississippi and South Dakota

Secret Shopper Data on Private Prices in the Nursing Home Industry From 2008 to 2010

Nationwide nursing home private-pay prices at the facility-level have not been available for researchers interested in studying this unique health care market. This study presents a new data source, Caregiverlist, for private-pay prices for private and semiprivate rooms for 12,000 nursing homes nationwide collected between 2008 and 2010. We link these data to publicly available national nursing home-level data sets to examine the relationship between price and nursing home characteristics. We also compare private-pay prices with average private-pay revenues per day for California nursing homes obtained from facilities' financial filings. On average, private-pay prices were $224 per day for private rooms compared with $197 per day for semiprivate rooms. We find that nursing homes that are nonprofit, urban, hospital-based, have a special care unit, chain-owned, and have higher quality ratings have higher prices. We find average revenues per day in California to be moderately correlated with prices reported by Caregiverlist.

Does Assisted Living Capacity Influence Case Mix at Nursing Homes?

Assisted living facilities (ALFs) have grown over the past few decades. If they attract residents with lower care needs away from nursing homes (NHs), NHs may be left with higher case mix residents. We study the relationship between ALF bed market capacity and NH case mix in a state (Virginia) where ALF bed capacity stabilized after a period of growth. Similarly, NH capacity and use had been stable. While it is interesting to study markets in flux, for planning purposes, it is also important to examine what happens after periods of turbulence and adaptation. Our findings show some substitution of ALF for NH care, but the relationship is not linear with ALF market capacity. Communities need to consider the interplay of ALFs and NHs in planning for long-term care services and supports. Policies supporting ALFs may enable care needs to be met in a lower cost setting than the NH.

Exploring the ecology of Canada's publicly funded residential long-term care bed supply

Despite Canada's increasing population of seniors and the varying long-term care (LTC) strategies that provinces have implemented, little research has focused on understanding the extent to which publicly funded residential LTC bed supply varies across provinces, or the factors influencing this variation. Our study involved an analysis in which we examined the association of three select jurisdictional characteristics with LTC bed supply: population age demographics, provincial wealth, and provincial investments in home care. No significant cross-jurisdictional "ecology" or inter-relatedness was found between the variation in LTC bed supply and any of the examined variables. Interprovincial variation in bed supply also did not statistically influence alternate level of care days specific to LTC waits, suggesting that these days were not influenced simply by differences in LTC bed supply and that other provincial-level factors were in play.

The devil's in the details: trading policy goals for complexity in medicaid nursing home reimbursement

There is great variability in how much nursing home providers are paid for a day of care for a Medicaid recipient, how the payment level is set, and what mechanisms are used to reimburse facilities. Given the absence of recent, comprehensive in-depth analyses of state reimbursement systems, this article undertakes a comparative case analysis of Medicaid nursing facility reimbursement in Alabama, California, Minnesota, Texas, Washington, and Wisconsin. Findings indicate that states design their methods of reimbursement to achieve desired policy outcomes related to facility cost and quality, access to care, payment equity, service capacity, and budgetary control. The result, however, has been the development of enormously complex and demanding rate-setting methodologies, the adverse consequences of which can outweigh and overwhelm the discrete policy objectives contained in the reimbursement formula. This complexity highlights the potential trade-off between achieving desired goals and costly administrative burdens, opportunities for appeal and disagreement, difficulties understanding the ramifications of system changes, reliance on simplified decision-making rules, and exclusion of otherwise interested parties from the policy process.

Impact of Medicaid reimbursement on mental health quality indicators

OBJECTIVE

To examine the relationship between the use of the Minimum Data Set (MDS) for determining Medicaid reimbursement to nursing facilities and the MDS Quality Indicators examining nursing facility residents' mental health.

DATA SOURCES

The 2004 National MDS facility Quality Indicator reports served as the dependent variables. Explanatory variables were based on the 2004 Online Survey Certification and Reporting system (OSCAR) and an examination of existing reports, a review of the State Medicaid Plans, and State Medicaid personnel.

STUDY DESIGN

Multilevel regression models were used to account for the hierarchical structure of the data.

DATA COLLECTION

MDS and OSCAR data were linked by facility identifiers and subsequently linked with state-level variables.

PRINCIPAL FINDINGS

The use of the MDS for determining Medicaid reimbursement was associated with higher (poorer) quality indicator values for all four mental health quality indicators examined. This effect was not found in four comparison quality indicators.

CONCLUSIONS

The findings indicate that documentation of mental health symptoms may be influenced by economic incentives. Policy makers should be cautioned from using these measures as the basis for decision making, such as with pay-for-performance initiatives.

Predictors of nursing home hospitalization: a review of the literature

Hospitalization of nursing home residents is costly and potentially exposes residents to iatrogenic disease and psychological harm. This article critically reviews the association between the decision to hospitalize and factors related to the residents' welfare and preferences, the providers' attitudes, and the financial implications of hospitalization. Regarding the resident's welfare, factors associated with hospitalization included sociodemographics, health characteristics, nurse staffing, the presence of ancillary services, and the use of hospices. Patient preferences (e.g., advance directives) and provider attitudes (e.g., overburdening of staff) were also associated with increased hospitalization. Finally, financial variables related to hospitalization included nursing home ownership status and state Medicaid policies, such as nursing home payment rates and bed-hold requirements. Most studies relied on potentially confounded research designs, which leave open the issue of selection bias. Nevertheless, the existing literature asserts that nursing home hospitalizations are frequent, often preventable, and related to facility practices and state Medicaid policies.

Explaining direct care resource use of nursing home residents: findings from time studies in four states

OBJECTIVE

To explain variation in direct care resource use (RU) of nursing home residents based on the Resource Utilization Groups III (RUG-III) classification system and other resident- and unit-level explanatory variables.

DATA SOURCES/STUDY SETTING

Primary data were collected on 5,314 nursing home residents in 156 nursing units in 105 facilities from four states (CO, IN, MN, MS) from 1998 to 2004. Study Design. Nurses and other direct care staff recorded resident-specific and other time caring for all residents on sampled nursing units. Care time was linked to resident data from the Minimum Data Set assessment instrument. Major variables were: RUG-III group (34-group), other health and functional conditions, licensed and other professional minutes per day, unlicensed minutes per day, and direct care RU (wage-weighted minutes). Resident- and unit-level relationships were examined through hierarchical linear modeling.

DATA COLLECTION/EXTRACTION METHODS

Time study data were recorded with hand-held computers, verified for accuracy by project staff at the data collection sites and then merged into resident and unit-level data sets.

PRINCIPAL FINDINGS

Resident care time and RU varied between and within nursing units. RUG-III group was related to RU; variables such as length of stay and unit percentage of high acuity residents also were significantly related. Case-mix indices (CMIs) constructed from study data displayed much less variation across RUG-III groups than CMIs from earlier time studies.

CONCLUSIONS

Results from earlier time studies may not be representative of care patterns of Medicaid and private pay residents. New RUG-III CMIs should be developed to better reflect the relative costs of caring for these residents.

A Quality-Based Payment Strategy for Nursing Home Care in Minnesota

This article describes a pay-for-performance system developed for Minnesota nursing homes. In effect, nursing homes can retain a greater proportion of the difference between their costs and the average costs on the basis of their quality scores. The quality score is a derived and weighted composite measure currently composed of five elements: staff retention (25 points), staff turnover (15 points), use of pool staff (10 points), nursing home quality indicators (40 points), and survey deficiencies (10 points). Information on residents' quality of life and satisfaction, derived from interviews with a random sample of residents in each Minnesota nursing home, is now available for inclusion in the quality measure. The new payment system was designed to create a business case for quality when used in addition to a nursing home report card that uses the same quality elements to inform potential consumers about the quality of nursing homes. Although the nursing home industry has announced general support for the new approach, it has lobbied the legislature to delay its implementation, claiming concerns about operational details.

The effect of state medicaid case-mix payment on nursing home resident acuity

OBJECTIVE

To examine the relationship between Medicaid case-mix payment and nursing home resident acuity.

DATA SOURCES

Longitudinal Minimum Data Set (MDS) resident assessments from 1999 to 2002 and Online Survey Certification and Reporting (OSCAR) data from 1996 to 2002, for all freestanding nursing homes in the 48 contiguous U.S. states.

STUDY DESIGN

We used a facility fixed-effects model to examine the effect of introducing state case-mix payment on changes in nursing home case-mix acuity. Facility acuity was measured by aggregating the nursing case-mix index (NCMI) from the MDS using the Resource Utilization Group (Version III) resident classification system, separately for new admits and long-stay residents, and by an OSCAR-derived index combining a range of activity of daily living dependencies and special treatment measures.

DATA COLLECTION/EXTRACTION METHODS

We followed facilities over the study period to create a longitudinal data file based on the MDS and OSCAR, respectively, and linked facilities with longitudinal data on state case-mix payment policies for the same period.

PRINCIPAL FINDINGS

Across three acuity measures and two data sources, we found that states shifting to case-mix payment increased nursing home acuity levels over the study period. Specifically, we observed a 2.5 percent increase in the average acuity of new admits and a 1.3 to 1.4 percent increase in the acuity of long-stay residents, following the introduction of case-mix payment.

CONCLUSIONS

The adoption of case-mix payment increased access to care for higher acuity Medicaid residents.

Cost Analysis of Nursing Home Registered Nurse Staffing Times

OBJECTIVES

To examine potential cost savings from decreased adverse resident outcomes versus additional wages of nurses when nursing homes have adequate staffing.

DESIGN

A retrospective cost study using differences in adverse outcome rates of pressure ulcers (PUs), urinary tract infections (UTIs), and hospitalizations per resident per day from low staffing and adequate staffing nursing homes. Cost savings from reductions in these events are calculated in dollars and compared with costs of increasing nurse staffing.

SETTING

Eighty-two nursing homes throughout the United States.

PARTICIPANTS

One thousand three hundred seventy-six frail elderly long-term care residents at risk of PU development.

MEASUREMENTS

Event rates are from the National Pressure Ulcer Long-Term Care Study. Hospital costs are estimated from Medicare statistics and from charges in the Healthcare Cost and Utilization Project. UTI costs and PU costs are from cost-identification studies. Time horizon is 1 year; perspectives are societal and institutional.

RESULTS

Analyses showed an annual net societal benefit of 3,191 dollars per resident per year in a high-risk, long-stay nursing home unit that employs sufficient nurses to achieve 30 to 40 minutes of registered nurse direct care time per resident per day versus nursing homes that have nursing time of less than 10 minutes. Sensitivity analyses revealed a robust set of estimates, with no single or paired elements reaching the cost/benefit equality threshold.

CONCLUSION

Increasing nurse staffing in nursing homes may create significant societal cost savings from reduction in adverse outcomes. Challenges in increasing nurse staffing are discussed.

Effect of State Medicaid Reimbursement Rates on Hospitalizations from Nursing Homes

OBJECTIVES

To estimate the effect of state Medicaid nursing home reimbursement rates on hospitalizations of nursing home residents.

DESIGN

Cross-sectional sample of nongovernment-owned nursing homes with 25 beds or more in one Metropolitan Statistical Area in each of 10 states in 1993, with 6 months follow-up on mortality and hospitalizations.

SETTING

Two hundred fifty-three nursing homes.

PARTICIPANTS

Eight to 16 randomly selected residents from each facility, totaling 2,080.

MEASUREMENTS

Minimum Data Set assessments conducted by research nurses at baseline. A three-category 6-month outcome was defined as (1) any hospitalization; for those not hospitalized, (2) death versus (3) alive in the facility.

RESULTS

Using multinomial logistic regression, adjusted to survey design, controlling for resident and facility characteristics, a 10 dollar increase in 1993 Medicaid reimbursement rate above the mean rate of approximately 75 dollars resulted in a 9% reduction in a resident's risk of hospitalization (P<.05).

CONCLUSION

State Medicaid reimbursement rates appear to affect clinical decisions regarding the need for hospital admission and thresholds for nursing home use. The findings from this study reemphasize the importance of properly aligning state Medicaid and federal Medicare long-term care policies because, currently, states have no incentive to increase reimbursement rates to avoid hospitalization.

Does quality of care lead to better financial performance?: the case of the nursing home industry

The study describes the relationship between quality of care and financial performance (operating profit margin) as it pertains to the nursing home industry. We found that nursing homes that produce better outcomes and process of care were able to achieve lower patient care costs and report better financial performance.