Changes to CMS Five-Star: What Investors and Operators Need to Know Thursday, March 8, 2018 4:00 PM 5:15 PM Dallas Ballroom F #NICForum18
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Speakers Steven Littlehale, MS, GCNS-BC EVP & Chief Clinical Officer PointRight Inc. Eric Gillis, MBA Director of Asset Management CareTrust REIT 5
Why do we bother with clinical outcomes data? 6
From Volume to Value and Its Impact on SNFs Viability Success is: Determined on clinical outcomes playing field Requires metrics be monitored and properly managed Rehospitalization Swish! 7
Key Metrics from PointRight Available Soon to NIC MAP Subscribers and Skilled Nursing Data Contributors State/Metro Level Report Property Level Report 8
Five Star A Quick Overview 9
The primary goal in launching this rating system is to provide residents and their families with an easy way to understand assessment of nursing home quality, making meaningful distinctions between high and low performing nursing homes. CMS s Technical Users Guide July 2009
I need a nursing home for my wife. I cannot afford a Five-Star or even a Four-Star home, can you recommend a Three-Star? Consumer in Florida March 2010
CMS Five-Star Program The rating system features an overall Five-Star rating based on facility performance for three types of performance measures: Health Inspection Staffing Quality Measures The rating system has been available to the public on CMS website Nursing Home Compare since December 18, 2008 13
1.3 million page views per month
Five-Star does nothing to match the right person to the right SNF All SNFs are not the same De facto specialty care centers Acute Medical/Rehab Alzheimer's/Cognitive Impairment Mental Health End of Life/Frail Elders All consumers coming into a SNF are not the same Some are patients and will be going home Some are residents and will not All have unique needs 15
Add 1 Star to Overall Add 1 Star to Overall 4 or 5 and >HI 5 1 Initial Health Inspection Rating (HI) 2 Staffing Rating 3 QM Rating 4 Overall Five Star Rating 1 1 Minus 1 Star to Overall Minus 1 Star to Overall
Who s Using It and Why? 17
Five-Star Uses (and Abuses) are Far Ranging Intended Uses Consumer placement Consumer monitoring of care Unintended Uses APM (ACOs, Bundles) HUD Commercial payers Plaintiff Attorney REITs 19
APM: What is a Three-Day Requirement & Waiver? Requirement: Qualifying inpatient hospital stay of 3 consecutive days (midnights) or more (plus additional criteria) Waiver: For eligible programs, CMS will waive the requirement for a 3-day inpatient hospital stay prior to a Medicare-covered, post-hospital extended care service for eligible beneficiaries 20
A Waiver is a good thing For the ACO/Bundle it means the possibility of transitioning patient to lower cost center (the SNF) For the SNF, it means a potentially better referral stream of higher acuity residents The spill over effect a hospital discharge planner knows what she knows other FFS patients may turn up in same hospital to SNF stream So how do you get one? 21
Who Gets a Three Day Waiver? SNF must have a 3 or better Overall Star Rating ACO Track +1, Track 3 and Next Gen Bundles: For Model 2/Model 3 participants but there is always a catch! 22
Five-Star Ratings & Rehospitalization Rates Overall Rating Jun-17 Median Observed Rehospitalization Rate Median Adjusted Rehospitalization Rate 5 14.1 15.2 4 15.9 16.1 3 17.1 16.9 2 17.6 17.2 1 19.3 18.1 PointRight Inc. 2018
Five-Star Ratings & Rehospitalization Rates PointRight Inc. 2018
Litigation 25
Are PL Claims >250K Correlated to Five-Star? Five-Star Domain overall health inspection quality staffing Yes! Yes! No! Yes! 26
Evaluating REIT: The Role of Five-Star Monitoring 27
Change is in the Air 28
Health Inspection and Staffing Domains Remember that HI has most significant impact on Five-Star Staffing domain has the second impact score Anytime these domains are touched, facility-level five-star changes occur CMS has not released technical manuals that reflect these impending changes 29
Health Inspection Deficiency data* from complaint or standard surveys post Nov 28 th are not included until further notice (effective: Jan 2018) Traditionally three survey cycles were used in calculation, this will reduce to two (effective: March 1) Most recent survey cycle/year will be weighted 60%, second most recent, weighted 40%. Technical specification was released March 2nd * This deficiency data is posted on NHC 30
The Winners and the Losers An Approximation Health Inspection Domain About 20% of SNFs will see a change in their health inspection domain 1329 will see a decrease 1726 will see an increase Overall Five-Star 15% of SNFs will see a change in Overall Stars 1017 will see a decrease in Star Rating 1266 will see an increase in Star Rating 303 will lose their 3 Star Rating 348 will obtain a 3 Star Rating If in Jan 18 three cycles were to reduce to two 31
Electronic Submission of Staffing Data The Affordable Care Act requires facilities to electronically submit direct care staffing information based on payroll and other auditable data. Combined with census information will be used to report on staffing levels Includes agency and contract staff CMS deployed system to allow for submission of staffing: the Payroll- Based Journal (PBJ). Staffing is submitted quarterly It will also be auditable to ensure accuracy and compliance Noncompliance will be subject to CMS enforcement actions 32
Staffing Data
The Potential Five-Star Impact Staffing Type N Mean Median RN HPRD from CMS 671 (Sep-17) 14,153 0.82 0.71 RN HPRD from Q3 2017 PBJ file when LPNs with admin duties are still counted under RN 14,153 0.71 0.61 RN HPRD from Q3 2017 PBJ file 14,153 0.64 0.55 * N only includes providers that have a non-missing value for both CMS-671 and PBJ staffing. PointRight Inc. 2018
PBJ vs CMS - 671 Staff Type N Median CMS - 671 Median PBJ Median Difference (PBJ 671) Median Percent Difference RN HPRD 14,153 0.71 0.55-0.16-22.5% LPN HPRD 14,153 0.83 0.85 0.02 2.4% Aide HPRD 14,153 2.37 2.23-0.14-5.9% Total HPRD 14,153 3.95 3.67-0.28-7.1% * N only includes providers that have a non-missing value for both CMS-671 and PBJ staffing. PointRight Inc. 2018
Removing LPN w/admin Duties from RN Bucket RN Staffing Rating Sep-17 % of SNFs - Today % of SNFs - PBJ data (removing LPN with admin duties) 5 21.6 13.1 4 26.6 16.7 3 26.6 21.1 2 16.0 19.1 1 9.2 30.0 PointRight Inc. 2018 36
Then Recalculate Staffing Domain Staffing Rating Sep-17 % of SNFs - Today % of SNFs - PBJ data (removing LPN with admin duties) 5 12.2 6.7 4 31.6 18.5 3 30.1 26.4 2 14.2 18.7 1 11.9 29.7 PointRight Inc. 2018 37
Then Recalculate Overall Five-Star Overall Rating Sep-17 % of SNFs - Today % of SNFs - PBJ data (removing LPN with admin duties) 5 27.1 21.8 4 22.3 20.1 3 17.9 18.5 2 19.0 20.9 1 13.7 18.7 PointRight Inc. 2018 38
PBJ Staffing Data: Key Differences to Keep in Mind Salaried workers that pick up additional shifts will not have those hours counted, unless paid a bonus for those hours If an employee performs multiple job functions, code them to primary function Focus is on auditable data that can be verified Hours paid for services performed onsite, not including lunch, sick leave, vacation Corporate staff can be counted in some instances but must be auditable Contract/agency staff must be reported Census is calculated by MDS essential that discharge assessments be completed
Staffing and Rehospitalization, and other key findings MHPs pain, pressure ulcers ER use immunizations pressure ulcers pain Pharmacists immunizations pressure ulcers pain RN Staffing Higher RN staffing is by far the most powerful thing in better PAC outcomes NP NP FTE 0.5 ER use rehosp ROC pressure ulcers antipsychotics Medical Director Medical Director > 0.2 FTE ER use rehosp ROC pressure ulcers antipsychotics 40
How do these changes impact the REIT? Evaluating Monitoring 41
Conclusion What is Certain Key clinical outcomes are essential KPIs to track Five-Star has an impact on a SNFs success Five-Star is changing What is Less Certain Technical details around Five-Star changes Timing of Five-Star changes Future impact on SNFs of volume to value 42
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Thank You! Steven Littlehale EVP & Chief Clinical Officer, PointRight 781.457.5900 steven.littlehale@pointright.com Eric Gillis Director of Asset Management, CareTrust REIT 949.542.3139 egillis@caretrustreit.com #NICForum18 44