- Email: [email protected]
Outliers in home care
Leadership Forum
Mary Ann Anderson, PhD, RN, and Lelia B. Helms, PhD, JD
Outliers in Home Care
Mary Ann Anderson, PhD, RN, is an associate professor at the University of Illinois at Chicago College of Nursing on the Quad Cities Regional Campus in Moline, Ill. Lelia B. Helms, PhD, JD, is a professor in planning, policy, and leadership studies at the University of Iowa College of Education in Iowa City. Address for correspondence: Anita W. Finkelman, MSN, RN, Section Editor, 3350 Principio Ave., Cincinnati, OH 45208; resources [email protected] Reprint orders: Mosby, Inc., 11830 Westline Industrial Dr., St. Louis, MO 631463318; phone (314) 4534350; reprint no. 69/1/116264 doi:10.1067/mhc.2001.116264
The prospective payment system (PPS), imposed on home health care in October 2000, is reshaping the dynamics of agency management. The PPS recalibrates the economic incentives for reimbursing home health agencies (HHAs) for the costs incurred in delivering care to Medicare patients—the majority of patients served. Home health administrators responsible for the fiscal stability of their agencies now face problems of patient mix: that is, projecting some degree of profitability based on expected resource-utilization profiles for the group of patients comprising an agency’s caseload at a given point. Agency leaders soon will demand better information from nurse researchers linking patient characteristics at intake with resource-utilization profiles for an episode of care. Such data will be essential to protecting the long-term fiscal viability of HHAs. Home care administrators and staff have long been interested in issues of efficiency in service delivery. Some evidence has been generated examining resource utilization in home health care.1,2 In the future, however, resource utilization can be expected to occupy center stage in the daily thinking of administrators and researchers. Home care resource utilization is defined as the amount of nursing services used by a single client or group of clients during one episode of care or time period.3 Various measures have been used to describe home care client resource use, including patient classification systems, demographic and medical status indicators, nursing dependency tools, nursing diagnoses, and agency characteristics.1 Ideally, such information helps providers establish norms of care delivery so as to predict and allocate agency efforts appropriately. Resource utilization profiles provide a basis for estimating care costs and managing an agency’s budget. By default, better comprehension of the norms of such utilization elicits information about clients whose episodes of home care fall outside custom-
ary patterns. Thus, the underlying, unstated purpose of much of this work in home care resource utilization is to identify and characterize clients who are considered “outliers”—clients whose care consumes services substantially above the norm.1 Identifying characteristics of such clients is critical for HHAs, particularly since the inception of the PPS. Outliers are those patients for whom an agency has assumed economic responsibility but whose care substantially exceeds the period allowed by their reimbursement status. Outliers drain an agency’s budgetary resources. Most of the current literature concerning the PPS in home care reflects an industry adapting to the radical change from fee-for-service to prospective payment. Articles tend to address mechanistic facets of the new process, such as advice on implementing OASIS, legal and ethical dilemmas, and speculation about what the PPS will mean for the organizational climate and culture of home care. Missing, however, is evidence anticipating the problems posed by outliers to agency reimbursement and sufficient evidence about resource utilization to develop profiles for predicting outliers. A recent search of standard computerized databases, including CINAHL, MEDLINE, and HEALTHSTAR, a health administrative database, revealed little research on outliers in home health care. In fact, using the descriptors home health care and outliers yielded 0 citations. This fact is particularly troubling as implementation of the PPS proceeds in the home care sector. We suspect this lack of research needs rapid remedy. What is known about outliers in home health care must be extrapolated from the abundant hospital-focused literature on the topic, literature concerned with adverse outcomes (eg, hospital readmission),4,5 previous but limited resource utilization studies, and intuition of home care clinicians. With the inception of the PPS in 1983 in hospitals June 2001
■ 81
Key Points • Agency viability partially depends on the capability to identify outliers prospectively. • Better information is needed projecting resource utilization for home care patients prospectively. • Outliers can drain an agency’s budgetary resources. • The message in the hospital-based literature is clear—minimize outliers.
using diagnostic related groups, the study of patients exceeding the proscribed number of hospital days burgeoned. The hospital-based literature tends to define outlier as a patient with an extended length of stay,6,7 high usage of the outpatient or emergency department,8 or as a hospital readmission.5 The message in the hospital-based studies is clear— minimize outliers.9 In the home care literature, both the research and experienced nurses report that certain groups of patients, such as those with congestive heart failure and wounds, are at greater risk for adverse outcomes and thus are more likely to become outliers. This latter evidence is limited and anecdotal. Information concerning outliers in home care, systematically collected under controlled conditions, is needed to help agency leaders balance patient mix and agency resources in an ethically and fiscally responsible manner. This time is critical for the home care industry. The external forces shaping the future are pervasive and powerful. Fiscal concerns are a primary motivation for these changes. HHAs must work within new constraints to ensure viability. Key to this survival is the ongoing need for agency administrators to ensure an appropriate patient mix for the agency as a whole, including the prospective identification of outliers before accepting responsibility for such patients—a decision over which HHAs continue to retain discretion under the PPS. This step is essential to long-term financial solvency. Identifying outliers requires extensive evidence based on an in-depth examination of client characteristics and associ-
82 ■ Home Care Provider
ated high resource use gathered from patient records.5,10 Like hospitals, home care must develop profiles of outliers so that cost-containment strategies may be developed.Yet it is unrealistic to expect individual agencies to accomplish such an endeavor alone. The necessary evidence may be generated through collaborative partnerships between HHAs and seasoned home care nurse researchers. Home care leaders traditionally have welcomed nurse researchers.11 Today, home health’s need for information about patients and their prospective needs for care, collected in a rigorous, controlled manner, has never been greater. Research from the perspective of HHAs rather than federal policy-makers focused narrowly on cutting costs can improve home health management and care delivery while preserving agency viability. Research characterizing outliers and subsequent dissemination of these profiles to home health administrators are essential to equipping responsible home health leadership for survival in the new policy environment of federal fiscal and administrative oversight. References 1. Anderson MA, Pena RA, Helms LB. Home care utilization by congestive heart failure patients: a pilot study. Public Health Nurs 1998;15(2):146-62. 2. Saba V. Develop and demonstrate a method for classifying home health patients to predict resource requirements and to measure outcomes. Washington (DC): Georgetown University School of Nursing; 1991. 3. Helberg J. Use of home care nursing resources by the elderly. Public Health Nurs 1994;11(2):104-12. 4. Anderson MA, Hanson KS, DeVilder N, Helms LB. Hospital readmission during the home care service delivery period. J Community Health Nurs 1996;13:1-12. 5. Anderson MA, Helms LB, Hanson KS, DeVilder N. Unplanned hospital readmission: a home care perspective. Nurs Res 1999;48:299-307. 6. Lagoe R, Arnold K, Noetscher C. Benchmarking hospital lengths of stay using histograms. Nurs Econ 1999;17(2):75-83,102. 7. Weissman C. Analyzing intensive care unit length of stay data: problems and possible solutions. Crit Care Med 1997;25:1594-600. 8. Belcher J, Alexy B. High-resource hospital users in an integrated delivery system. J Nurs Admin 1999;29(10):30-6. 9. Caesar N. Protect against outliers that destroy your profitability under a contract. Managed Care 1998;7(4):68,71. 10. Helberg J. Resource utilization in methods and issues. Nursing Health Care 1995;11:464-8. 11. Madigan E, Anderson MA. Service delivery challenges in home health care research. Res Nurs Health 1999;22:349-53.
Mary Ann Anderson, PhD, RN, and Lelia B. Helms, PhD, JD
Outliers in Home Care
Mary Ann Anderson, PhD, RN, is an associate professor at the University of Illinois at Chicago College of Nursing on the Quad Cities Regional Campus in Moline, Ill. Lelia B. Helms, PhD, JD, is a professor in planning, policy, and leadership studies at the University of Iowa College of Education in Iowa City. Address for correspondence: Anita W. Finkelman, MSN, RN, Section Editor, 3350 Principio Ave., Cincinnati, OH 45208; resources [email protected] Reprint orders: Mosby, Inc., 11830 Westline Industrial Dr., St. Louis, MO 631463318; phone (314) 4534350; reprint no. 69/1/116264 doi:10.1067/mhc.2001.116264
The prospective payment system (PPS), imposed on home health care in October 2000, is reshaping the dynamics of agency management. The PPS recalibrates the economic incentives for reimbursing home health agencies (HHAs) for the costs incurred in delivering care to Medicare patients—the majority of patients served. Home health administrators responsible for the fiscal stability of their agencies now face problems of patient mix: that is, projecting some degree of profitability based on expected resource-utilization profiles for the group of patients comprising an agency’s caseload at a given point. Agency leaders soon will demand better information from nurse researchers linking patient characteristics at intake with resource-utilization profiles for an episode of care. Such data will be essential to protecting the long-term fiscal viability of HHAs. Home care administrators and staff have long been interested in issues of efficiency in service delivery. Some evidence has been generated examining resource utilization in home health care.1,2 In the future, however, resource utilization can be expected to occupy center stage in the daily thinking of administrators and researchers. Home care resource utilization is defined as the amount of nursing services used by a single client or group of clients during one episode of care or time period.3 Various measures have been used to describe home care client resource use, including patient classification systems, demographic and medical status indicators, nursing dependency tools, nursing diagnoses, and agency characteristics.1 Ideally, such information helps providers establish norms of care delivery so as to predict and allocate agency efforts appropriately. Resource utilization profiles provide a basis for estimating care costs and managing an agency’s budget. By default, better comprehension of the norms of such utilization elicits information about clients whose episodes of home care fall outside custom-
ary patterns. Thus, the underlying, unstated purpose of much of this work in home care resource utilization is to identify and characterize clients who are considered “outliers”—clients whose care consumes services substantially above the norm.1 Identifying characteristics of such clients is critical for HHAs, particularly since the inception of the PPS. Outliers are those patients for whom an agency has assumed economic responsibility but whose care substantially exceeds the period allowed by their reimbursement status. Outliers drain an agency’s budgetary resources. Most of the current literature concerning the PPS in home care reflects an industry adapting to the radical change from fee-for-service to prospective payment. Articles tend to address mechanistic facets of the new process, such as advice on implementing OASIS, legal and ethical dilemmas, and speculation about what the PPS will mean for the organizational climate and culture of home care. Missing, however, is evidence anticipating the problems posed by outliers to agency reimbursement and sufficient evidence about resource utilization to develop profiles for predicting outliers. A recent search of standard computerized databases, including CINAHL, MEDLINE, and HEALTHSTAR, a health administrative database, revealed little research on outliers in home health care. In fact, using the descriptors home health care and outliers yielded 0 citations. This fact is particularly troubling as implementation of the PPS proceeds in the home care sector. We suspect this lack of research needs rapid remedy. What is known about outliers in home health care must be extrapolated from the abundant hospital-focused literature on the topic, literature concerned with adverse outcomes (eg, hospital readmission),4,5 previous but limited resource utilization studies, and intuition of home care clinicians. With the inception of the PPS in 1983 in hospitals June 2001
■ 81
Key Points • Agency viability partially depends on the capability to identify outliers prospectively. • Better information is needed projecting resource utilization for home care patients prospectively. • Outliers can drain an agency’s budgetary resources. • The message in the hospital-based literature is clear—minimize outliers.
using diagnostic related groups, the study of patients exceeding the proscribed number of hospital days burgeoned. The hospital-based literature tends to define outlier as a patient with an extended length of stay,6,7 high usage of the outpatient or emergency department,8 or as a hospital readmission.5 The message in the hospital-based studies is clear— minimize outliers.9 In the home care literature, both the research and experienced nurses report that certain groups of patients, such as those with congestive heart failure and wounds, are at greater risk for adverse outcomes and thus are more likely to become outliers. This latter evidence is limited and anecdotal. Information concerning outliers in home care, systematically collected under controlled conditions, is needed to help agency leaders balance patient mix and agency resources in an ethically and fiscally responsible manner. This time is critical for the home care industry. The external forces shaping the future are pervasive and powerful. Fiscal concerns are a primary motivation for these changes. HHAs must work within new constraints to ensure viability. Key to this survival is the ongoing need for agency administrators to ensure an appropriate patient mix for the agency as a whole, including the prospective identification of outliers before accepting responsibility for such patients—a decision over which HHAs continue to retain discretion under the PPS. This step is essential to long-term financial solvency. Identifying outliers requires extensive evidence based on an in-depth examination of client characteristics and associ-
82 ■ Home Care Provider
ated high resource use gathered from patient records.5,10 Like hospitals, home care must develop profiles of outliers so that cost-containment strategies may be developed.Yet it is unrealistic to expect individual agencies to accomplish such an endeavor alone. The necessary evidence may be generated through collaborative partnerships between HHAs and seasoned home care nurse researchers. Home care leaders traditionally have welcomed nurse researchers.11 Today, home health’s need for information about patients and their prospective needs for care, collected in a rigorous, controlled manner, has never been greater. Research from the perspective of HHAs rather than federal policy-makers focused narrowly on cutting costs can improve home health management and care delivery while preserving agency viability. Research characterizing outliers and subsequent dissemination of these profiles to home health administrators are essential to equipping responsible home health leadership for survival in the new policy environment of federal fiscal and administrative oversight. References 1. Anderson MA, Pena RA, Helms LB. Home care utilization by congestive heart failure patients: a pilot study. Public Health Nurs 1998;15(2):146-62. 2. Saba V. Develop and demonstrate a method for classifying home health patients to predict resource requirements and to measure outcomes. Washington (DC): Georgetown University School of Nursing; 1991. 3. Helberg J. Use of home care nursing resources by the elderly. Public Health Nurs 1994;11(2):104-12. 4. Anderson MA, Hanson KS, DeVilder N, Helms LB. Hospital readmission during the home care service delivery period. J Community Health Nurs 1996;13:1-12. 5. Anderson MA, Helms LB, Hanson KS, DeVilder N. Unplanned hospital readmission: a home care perspective. Nurs Res 1999;48:299-307. 6. Lagoe R, Arnold K, Noetscher C. Benchmarking hospital lengths of stay using histograms. Nurs Econ 1999;17(2):75-83,102. 7. Weissman C. Analyzing intensive care unit length of stay data: problems and possible solutions. Crit Care Med 1997;25:1594-600. 8. Belcher J, Alexy B. High-resource hospital users in an integrated delivery system. J Nurs Admin 1999;29(10):30-6. 9. Caesar N. Protect against outliers that destroy your profitability under a contract. Managed Care 1998;7(4):68,71. 10. Helberg J. Resource utilization in methods and issues. Nursing Health Care 1995;11:464-8. 11. Madigan E, Anderson MA. Service delivery challenges in home health care research. Res Nurs Health 1999;22:349-53.