Harmony Healthcare Blog

2017 AHCA Provider Lounge Series: Case Mix in a Value-Based Purchasing Environment

Posted by Kris Mastrangelo on Tue, Jan 02, 2018


Reviewed by Kris Mastrangelo

C.A.R.E.

Compliance • Audits/Analysis • Reimbursement/Regulatory • Education/Efficiency


Interview with Stephen Hanse, President of New York State Health Facilities Association

Kris Mastrangelo, President of Harmony Healthcare International (HHI) interviews Stephen Hanse, President of New York State Health Facilities Association (NYSHFA), in the 2017 AHCA Provider Lounge.  Stephen talks about the process of transitioning the Case Mix payment system to a Value-Based Purchasing environment and how it is affecting providers in New York State.   Partnering with the Department of Health has helped providers better understand both the Value-Based Purchasing environment and also the New Survey Process.  (Audio transcription below).

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Transcribed Audio:

Kris Mastrangelo: Welcome to the 68th Annual AHCA/NCAL Annual Convention. We are lucky to have Stephen Hanse from New York State Health Care Facility Association, President and CEO. How you doing today Stephen?

Stephen Hanse: I'm doing fantastic. It's a pleasure to be here. Thank you.

Kris: We are so excited to talk to you. We know that you're new in the role and we have a lot going on in New York

Stephen: New York is never a dull moment. I joined our association in 2013 as Vice President and Counsel and from that day forward the regulatory and legislative issues facing long-term care providers in New York has not let up one bit. Payment issues, managed long-term care issues, value-based payment issues. We really just continue to move forward in New York as New York really tries to lead the nation in terms of changing the paradigm of long term care.

Kris: And I will tell you I have a lot of clients in New York and the New York is exceptional. They are ahead of the curve, they're ahead of the rest of the country on a lot of areas. Particularly I would like to talk about Case Mix, which is managed Medicaid or Medicaid, and bringing in the value-based purchasing component. So, there are only 34 states that have a RUGs based Medicaid system and now you're telling me that your case mix is bringing in value-based purchasing.

Stephen: Yes. New York State transitioned to managed long-term care on the Medicaid side from a fee-for-service based system and with that the state is transitioning to an agreement with CMS to really move the system to a value-based payment method, VBP 1, VBP 2 and so on. They're linking a lot of the payment methodologies moving forward to those VBP levels, which is difficult.

Kris: This morning I spoke and for those that don't know value-based purchasing has three components: a measurement, a report and a reward. A measurement for Part A is hospital readmissions. The report needs to be transparent for the consumer and the reward is 2%. tell me for Case Mix, New York Case Mix, what is the measurements for their value-based purchasing?

Stephen: Well it's a process and they're working through it and it's interesting because when we look at VBP 1 and we're looking at our members and those measurements and how many at the present time can meet these standards. We're really looking about 5% right now of providers in New York State. Right now, in New York State we have about 629 long-term care providers so it hasn't fully taken effect yet. It's a process that states trying to transition through for the Medicaid population for payment, which is a very difficult time for us to work this through. As I mentioned earlier you know we're facing the changes on the federal level with the potential for Medicaid cuts that we were working closely with AHCA on that issue. In addition to managed care issue, it's very difficult. While we have relatively strong census numbers, New York unfortunately leads the nation right now at a $56 per day per patient per day shortfall and on the Medicaid side. It's been ten years since providers in New York State have received a trend factor a cost-of-living increase. So, our members are working diligently in this environment, very cost-conscious environment, to really ensure that we provide the high-quality care in the VBP future environment.

Kris: That Medicaid shortfall is significant. A provider will not be able to survive without other payer sources given that. A $56 PPD is intense.

Stephen: Absolutely. The only way we really can survive generally speaking is with the Medicare and the private pay. I mean roughly about 76% of our members’ population is a Medicaid population.

Kris: So, let's talk about something else. You know we've got the regulatory component as well and the requirements of participation and how are your members feeling about completing the expectations? Are they overwhelmed? Do they have any insight into some ideas? How are they dealing with it?

Stephen: It’s a difficult one to deal with. We're working with AHCA on the national level to really bring attention to the costs and the impositions on that. We're actually working (our members and the association is) working with the Department of Health on the new survey regulations under the requirements of participation. They're going into effect November 26th. We're working with the department to help them train our members because it's really kind of a black box. So, we've reached out to the Department of Health as they train their surveyors on the new requirements to be able to train our members so we know in partnership with the department what the Department of Health in New York State will be looking for with our members. That's one of our biggest concerns really. The survey process unfortunately tends to be, and I would argue it shouldn't be it, from time to time it tends to be an adversarial process which really it should be a partnership where we all have the same goal in mind: high quality to ensure better care for our members. So that's one of the things on those survey requirements that were working with them so our members have a clear indication with the Department of what they will be looking for and how to work to make this better and make this transition work.

Kris: That’s great. Well we're grateful for NYSHFA, New York State Health Facilities Association. A great organization, you’re working diligently as you said earlier to represent your members and give them what they need from a regulatory and reimbursement perspective.

Stephen: Thank you so much. It's been a pleasure.


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Tags: Case Mix, Value-Based Purchasing

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