Skilled Nursing Providers Playing an Increasing Role in Reducing Hospital Re-admissions

NOV 20

The $200 billion skilled nursing and rehabilitation market is in the midst of a transformation and in a new world of ACOs and readmission penalties, we see these providers playing a significant role in helping hospitals reduce readmissions and providing patients with coordinated and professional care in a sub-acute environment.

In March 2012, the Medicare-Medicaid Coordination Office and the Center for Medicare and Medicaid Innovation announced the Initiative to Reduce Avoidable Hospitalization among Nursing Facility Residents. Through this initiative, CMS is partnering with seven organizations to implement strategies to reduce avoidable hospitalization for dual eligibles who are typically long-stay residents at nursing facilities. Each participant in the initiative is required to partner with a minimum of 15 dual eligible certified nursing facilities in the same state where the intervention will be implemented.

The goal of the initiative is to:

  • Reduce the number of and frequency of avoidable hospital admissions and readmissions;
  • Improve beneficiary health outcomes;
  • Provide better transition of care for beneficiaries between inpatient hospital and nursing facilities; and
  • Promote better care at lower costs while preserving access to beneficiary care and providers


CMS’ initiative, in addition to the Hospital Readmissions Reduction Program, is forcing skilled nursing care facilities to reevaluate their current delivery models.  As hospitals face Medicare reimbursement reductions for unnecessary readmissions, they will seek to partner with facilities that actively play a role in reducing those readmissions.  There are many programs currently being developed to focus on this issue, but one that seems to have gained acceptance in the marketplace is the INTERACT II (Interventions to Reduce Acute Care Transfers Version II) program, designed to improve the early identification, assessment, documentation, and communication about changes in the status of residents in skilled nursing facilities.  This program includes specific tools around communication, advanced care planning, quality improvement, and care paths that were refined and tested in a six-month collaborative improvement project with 25 nursing homes in three states.

In addition to implementing INTERACT II, Life Care Centers of America (LCCA); one of the nation’s largest skilled nursing providers, is making some waves in the industry through its success of reducing re-hospitalizations. Beginning in 2010, Life Care Centers of America began placing a full-time doctor in some of its facilities. While this move does not seem to be an earth-shattering idea, the impact was certainly noteworthy. In just one year, LCCA reduced re-hospitalization at its facilities with a full-time physician to 15% from 40%. In addition to a dramatically reduced readmissions rate among those participating facilities, LCCA also experienced reduce staff turnover and improved clinical outcomes.

Genesis HealthCare is another example of a skilled nursing provider leading the initiative to reduce hospital readmissions.  Genesis HealthCare, a leading provider of short-term post-acute, rehabilitation and skilled nursing care services, launched a new discharge product called PowerBack Rehabilitation aimed to reduce post-discharge setbacks and transition patients back to their homes as quickly as medically possible, rather than a nursing home that lumps all patients together, regardless of specific needs or acuity level.

Sidebar: Genesis’s Brightwood campus is the first of its kind to offer the innovate model of care (PowerBack) which features:

  • Expanded clinical capabilities to include cardiac, orthopedic and pulmonary specialized care;
  • Two full-time physicians and three full-time nurse practitioners on campus;
  • State-of-the art therapy technologies;
  • Therapy pool;
  • A 4,000 square foot therapy gym open 12 hours a day;
  • Added care planning and daily schedules to be directed by the patient;
  • Enhanced Guest Services team and training to ensure an outstanding experience;
  • Expanded dining services in multiple locations, including cafes, dining rooms and room service.


Although reducing re-hospitalizations may negatively impact skilled nursing facilities revenue in the short-term (e.g. fewer skilled and Part-A SNF days), long-term care providers are increasingly pursuing this goal anyway, believing that higher quality care will enhance referrals in the long-run. LCCA is certainly experiencing increased referrals as a result of its recent successes and we anticipate others innovators like Genesis to see dramatic referral gains in the near future.

Let us know what you think.

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Jonathan Hill