Nursing homes urged to improve with incentives
For years, states have struggled to raise the quality of care in nursing homes by using a regulatory stick -- citations, fines and other sanctions -- when serious problems are discovered.
Last month, Ohio adopted a distinctly different, carrot-like approach by using financial incentives that encourage better services for frail seniors.
It's the latest effort to address longstanding concerns such as too few nurses, too many patients who develop painful bed sores and high staff turnover.
Under Ohio's new approach, almost 10% of the Medicaid payments to nursing homes will depend on factors including residents' satisfaction, rates of medical complications and the number of nurses on staff. Medicaid, a federal-state health program for low-income people, is the largest funder of nursing home services in the nation. Seven other states have programs of this sort, but Ohio's will be the largest.
Meanwhile, Medicare, the federal health plan for seniors, plans to roll out a similar program for nursing homes nationally in the next several years, after government officials evaluate results of a three-year demonstration project in Arizona, New York and Wisconsin that ended July 1. Medicare pays for short nursing home stays for some patients who need skilled care after a hospitalization.
Whether the strategy will improve nursing home care is far from certain.
"A number of states have attempted this, but most programs have been short-lived and haven't really made much of a difference," said David Grabowski, a professor of health policy at Harvard Medical School and lead investigator for the Medicare demonstration project.
That may reflect design shortcomings rather than the failure of the underlying concept, several experts suggest.
"There is a lot of room to improve the way programs are structured and to maximize their impact," said Dr. Rachel Werner, an associate professor of medicine at the University of Pennsylvania and author of an unpublished study on states' nursing home "pay-for-performance" efforts.
States such as Colorado, Georgia, Kansas, Nevada, Oklahoma, Utah and Vermont award a small bonus (from 60 cents to $6.16 per patient per day) if facilities achieve various standards. But industry representatives say those incentives are insufficient, says Nicholas Castle, who has surveyed nursing home administrators and is a professor of health policy at the University of Pittsburgh.
Meeting the standards
Under the new Ohio program, a payment of up to $16.44 a day for each Medicaid patient depends on the facility meeting five of 20 quality standards.
Ohio's approach provides a "much more powerful incentive," said Michael Cheek, vice president of long-term care policy at the American Health Care Association, an industry trade group.
The goal of the initiative, as well as a broader health care overhaul launched last year by Republican Gov. John Kasich, is to create a "coordinated, comprehensive, patient-centered health care system in Ohio" that "reimburses for quality" and lowers the sharply rising trajectory of health care costs, explained Bonnie Kantor-Burman, director of the Ohio Department of Aging.
"We're dealing with a very challenging environment," but Ohio's 970 nursing homes generally support the state's new quality initiative, in part because most will qualify for new, quality-based incentive payments without much trouble, said Peter Van Runkle, executive director of the Ohio Health Care Association.
The threshold for receiving those payments has been the most controversial element of the state's plan.
"It just doesn't seem that (nursing homes) will have to stretch themselves enough, and I'll be advocating for raising the threshold in the future," said Beverley Laubert, Ohio's long-term care ombudsman. Initially, she had advocated that homes meet 15 of 20 standards, a goal that many would have found difficult to achieve.
State officials say it was important to start with a program that the industry would accept and that would not penalize large numbers of nursing homes. "Our plan is to up the ante" over time, said Kantor-Burman.
Ultimately, Ohio's program will depend on institutions such as Welcome Nursing Home in Oberlin, a 102-bed facility operated by the same family since 1945. Jill Herron, the administrator, said her facility will meet 18 out of 20 standards, but she questions how well those requirements reflect quality care.
Take the standard specifying that at least 50% of Medicaid-certified beds be in private rooms. The Welcome home has only six rooms of this type.
"Private rooms may be essential for market choice -- people may want them and like them -- but I don't think they're essential for quality care," Herron said.
Irene DuRell, an 82-year-old former nurse, has lived at the Welcome home for the past year with a 90-something roommate she calls "wonderful."
Asked what she likes best about Welcome, DuRell said, "They've been real good about helping out when I needed it. And they listen to me."
Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a non-profit, non-partisan health policy research and communication organization not affiliated with Kaiser Permanente.
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