Texas Hospital AssociationOctober 22, 2012

Rochelle Archuleta, AHA Policy

Aimee Hartlage, AHA Federal Relations

S. 1486

LTCH Improvement Act

Background &

Proposed Modifications

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LTCHs treat far greater proportion of patientswith Level 4 SOI (extreme severity)

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Goals for LTCH Criteria

• Demonstrate a unique and valuable role for LTCHs.• Distinguish LTCHs from all other settings. (general acute

hospitals; other post-acute providers)• Concentrate LTCHs on highest complexity, long-stay patients

• Proactively define LTCHs, rather than wait for CMS.– Pending CMS proposal likely to be harsh on LTCHs.

• Achieve regulatory stability through meaningful minimum standards.

• Provide bridge to the future delivery system reforms and common patient assessment tool.– Making a strong value case for LTCHs helps preserve future role for LTCHs

• Achieve support from AHA’s LTCH members.• Generate savings for Congress.

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How do the criteria work?

• Implement new minimum standards for LTCH patients and facilities.

• Provide policymakers with an insurance policy (ie, the retrospective 70% Rule facility criterion) that LTCHs are treating high acuity patients.

• Prohibit LTCHs from admitting patients suitable for inpatient rehab and inpatient psych level care.

• Require all LTCHs to provide ventilator weaning services. (19 LTCHs do not)

• Proposal does not alter the existing requirement that LTCHs maintain an average length of stay greater than 25 days.

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How were the criteria developed?

• Stage I. A consensus panel of experts developed the criteria proposal in 2010.– Panel: 14 hospital representatives, including 10 NFP reps

• Stage II. Following extensive advocacy of the criteria, as introduced in S.1486, AHA convened a smaller panel to refine the original proposal.− Panel: 9 hospital representatives, including 6 NFP reps

• Data Analysis. Extensive data analysis by The Moran Company from Summer 2010 through present has validated the criteria framework. – The analysis confirmed that the criteria proposal would

focus LTCHs on treating the highest overall acuity level relative to all other health settings.

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For S1486 details, see At-A-Glance document.

S.1486

Criteria Framework

Patient

Admission

Criteria

Facility

Criteria

Retrospective

Facility

Criterion(70% Rule)

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www.aha.org/ltch

Proposed Refinements to

Criteria Provisions in

S.1486

Revise Preadmission Criteria and Add New Patient Admissions Criterion: LTCHs shall not admit patients who, at the time of admission, have a primary medical need of inpatient psychiatric care.

• S.1486: Prohibits IRF-like patients. Does not address psych patients.• Objective: Prohibit admission of rehab and psych patients to maximize the

LTCH distinction from IRF and IPF settings. • Prohibited psych patients are identified by their admitting diagnosis since

this admission criterion would be applied by the LTHC physician conducting the patient admission evaluation.

• Also a technical change to add the S.1486 prohibition on rehabilitation patients to the preadmission screening criteria, in addition to the admission criteria.

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Criteria Modifications: Psych Patients

Admissions Criteria: Secondary Diagnoses

Criteria Refinement: Require a minimum of 5 secondary diagnoses for an LTCH admission.• S.1486: At least 2 secondary diagnoses required• Objective:

– Raise the standard.– Set minimum standard to align with what knowledge is

available to the LTCH physician at the point of admission.

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Criteria Modification: Narrow the provisionS.1486: Continued stay assessments must occur at least weekly. For cases that no longer need hospital-level care and lack a safe discharge option, for the remaining days, pay LTCH PPS per diem, up to the DRG.

– Must notify the bene of the continued stay assessment outcome.– Must continue to actively seek a safe discharge option.

• Maintain S.1486’s requirement for weekly continued stay assessments.

• Eliminate the payment component of this provision.– Leave this to the Medicare manual provisions.

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Admissions Criteria: Continued Stays

Additional Facility Criterion: Vent Services

New Facility Criterion: LTCHs must have the equipment and clinical personnel needed to provide ventilator weaning services.

S.1486: Does not require vent services.

Background:– LTCHs are distinguished by the excellence of

their specialized ventilator-weaning programs.– Policy analysis shows that LTCHs bring unique

value to the Medicare program for beneficiaries receiving ventilator services.

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“70% Rule” 2.0

Streamline the 70% Rule version in S.1486: • 70% threshold• Cases with at least 3 CC/MCCs • Cases with a ventilator procedure code will count• Remove LOS criterion• Remove STACH Outlier criterion.

CC/MCCs• CMS: The MS-DRG CC/MCCs target sicker patients; • CC/MCCs are correlated with the APR-DRG SOI; and• CC/MCC data are administratively feasible to CMS.

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Other S.1486 Changes

• Add 2-year moratorium on LTCH hospitals, satellites and beds– 2-year extension is seamless with MMSEA’s 5-year

moratorium.– Eliminate the MMSEA moratorium exceptions

• 2-year freeze of 25% Rule (at 50%/75% levels)– Instead of 25% Rule elimination under S.1486– Extend CMS’s 25% Rule relief through discharges on and

before Sept 30, 2014.

• Removed provision seeking to eliminate the 1-time budget neutrality adjustment

• Removed provision seeking to eliminate the very short stay outlier policy

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Achieving Compliance

Transition assistance for LTCHs that are non-compliant with the “70% Rule”• Multi-Year Phase-in

• 2-year phase-in for not-for-profit and for-profit LTCHs• Year 1: 60%; Year 2: 70%

• 3-year phase in for the govt-owned LTCHS• Year 1: 60%; Year 2: 65%; Year 3: 70%

• 6-month cure period for LTCHs that fail 70% Rule test.• Modeled after existing cure period for LTCH 25-day ALOS

requirement.

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Timing

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  Start Date End DateCriteria OPTIONS:

-- 6 months after enactment-- October 1, 2012-- Other?

Ongoing

Moratorium Dec 29, 2012 (Seamless with end of MMSEA moratorium)

Dec 28, 2014

25% Rule Relief Discharges beginningOctober 1, 2012

Discharges through Sept 30, 2014

Seamless extension of MMSEA moratorium and CMS’s new 25% Rule relief.

Facility ComplianceNFP v FP Facility Compliance Levels:When you combine the compliant and near-compliant (within 10%) LTCHs, facility compliance levels are very close for NFP and FP LTCHs.

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70% Rule Compliance AHA AnalysisOverall Case Compliance 80%Overall Facility Compliance 82%FP Facility Compliance 86%NFP Facility Compliance 79%Govt-Owned Fac. Compliance 33%Compliant + Near Compliant Facilities 91%For-Profit Compliant + Near Compliant 94%Not-For-Profit Compliant + Near Compliant 91%

"Near compliers" are within 10% of compliance with the 70% Rule.

Criteria Encourage High Acuity

The criteria proposal favors every LTCH that treats a high acuity patient mix.• 100% of LTCHs will have to modify their admissions standards to reflect

these more stringent standards;– This proposal is about the type of patients of treated in LTCHs; not about the

ownership status of LTCHs;• The proposal intentionally raises the bar for LTCH admissions to build

credibility with Congress and other policymakers; and demonstrate LTCH value by ensuring a level of service that is unmatched by any other setting.

• A very high rate of NFP LTCHs (79%) comply with the proposal, including very highly regarded NFP LTCHs (e.g., Partners; CHRISTUS; RML; Barlow).

• When compliant and near-compliant (within 10%) LTCHs are combined, FP (94%) and NFP (91%) compliance levels are very similar.

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Examining Compliers vs. Non-compliers

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Psych Cases Rehab Cases Cases with < 5 SDX0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

1.3%

0.8%0.7%

1.0%

0.7%

0.4%

3.0%

1.2%

2.2%

Percent of Cases in Excluded Categories as a Percent of All Cases Within Compliant, Non-Compliant and All LTCHs

All LTCHs (N=434)

Compliant LTCHs (N=357)

Non-Compliant LTCHs (N=77)

Per

cen

tage

of

Tot

al C

ases

Source: 2011 MedPAR Data, POS Data, and LTCH Impact File

Examining Compliers vs. Non-compliers

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All LTCHs (N=434) Compliant + Near-Com-pliant LTCHs (N=397)

Non-Compliant LTCHs Excl. Near-Compliant (N=37)

0.0

1.0

2.0

3.0

4.0

5.0

6.0

5.25.3

2.7

Average Number of CC/MCCsA

vera

ge #

of

CC

/MC

Cs

Analysis of the 2011 Medicare Provider Analysis and Review (MedPAR) dataset (March 2012 update).

LTCH Payments by Category

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Category

(2011 MEDPAR)

Total Medicare Payment

($ in Millions)

< 5 SDX $24Rehab $25Psych $27Non-compliant cases $691Compliant cases $4,678All Cases $5,445All Cases minus Exclusions $5,369

Rochelle Archuleta

AHA Policy

rarchuleta@aha.org

Aimee Hartlage

AHA Federal Relations

ahartlage@aha.org

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