Option to Combine Disability Groups into One Waiver

The rule would allow multiple disability groups (aged or disabled, developmentally disabled, and mentally ill) into one waiver.  Currently, rules require a separate waiver for each disability group.

Clarification of Allowed HCBS Settings

The proposed rule expressly defines settings where HCBS services may be provided as well as adds a provision whereby the Secretary has full discretion to determine if a setting has “qualities of an institution”.  Under the proposed rule, the HCBS setting definition requirements include:

1. Must be integrated into the community
2. Must not be located in building that also provides institutional or custodial care
3. Must not be located on the grounds or immediately adjacent to a public institution
4. Must not be a housing complex designed expressly around an individual’s diagnosis or disability as determined by the Secretary
5. Must not have qualities of an institution as determined by the Secretary including:
   1. Regimental meal and/or sleeping times
   2. Limitations on visitors
   3. Lack of privacy
   4. Other attributes that limit the individual’s ability to engage freely in the community

Person-Centered Planning Required

Previously optional, the proposed rule would require the state to adopt a person-centered planning model.  Under the proposed rule, the person-centered planning requirements include:

1. Must be based on a person-centered functional assessment with defined requirements including identifying the individual’s strengths, preferences, needs (clinical and supports), and the individual’s desired outcomes
2. Directed by the individual and may include a representative(s) freely chosen by the individual to assist and include a team of their own choosing
3. Include paid and non-paid services and supports
4. Result in a service and support plan in the most integrated community setting
5. May result in a personal service budget which the individual may direct.

Comments on these proposed rules will be taken through June 14, 2011.  Complete copy of the proposed rule–HCBSProposedRule04152011.

• Operating metrics that will be positively influenced with the use of an EHR
• How you can predict the impact on your bottom line
• Examples of behavioral health providers who have experienced net financial improvement as a direct result of implementing an EHR

Download the handouts from this presentation here.

http://www.cms.gov/EHRIncentivePrograms/20_RegistrationandAttestation.asp

Some health plans will no doubt attempt to re-label and slightly modify UR activities and argue that it is quality improvement but the most plans will likely shift focus to more pro-active care management, and clinical consultation for protocol outliers.  This will also be consistent with the growing focus on evidence-informed and evidence-based practices.

Now is the time for providers to start the process of revamping their own utilization review processes to focus on quality improvement rather than utilization controls or singular cost containment.

Anything that reduces the cost to deliver a unit of service, the total number of units required to treat an illness successfully, or the amount of other, more expensive services will bend the cost curve.  There has been much early attention on changes to reimbursement structures to change the production driven incentives that currently exist in fee-for-service models.  Hopefully, the reform legislation will create a fertile environment for demonstration projects that will find viable alternatives to the current reimbursement structures.

But any reimbursement model will still include benefits for provider cost efficiencies in delivering services.  Low cost providers will have competitive advantages for years to come, and will be able to have the financial margins to invest in technologies or creative delivery system ventures that position the organization for long-term success.  Low unit costs are also imperative to surviving the current environment of state budget crises and the near term future prior to the arrival of more thoughtful reimbursement mechanisms.

One of the most important aspects of managing costs is to ensure staff are producing reasonable levels of billable units—achieving targeted productivity levels.  Managing productivity is one of the most challenging aspects of provider operations.  As a manager, as soon as you take your eye off the ball, productivity is likely to fall.  And it falls much faster than it rises!

Consider the following example—For an organization with 55 FTEs who deliver services at an average rate of $100/hour, a 1% productivity improvement will yield nearly $100,000 in additional revenues (FFS billing), or reduce the staff needed to produce the same volume of services by 0.5 FTEs (capped reimbursement).  If this organization had been operating at breakeven, a 1% productivity improvement yields a 2% reduction in costs per hour.  You just can’t afford to ignore productivity as a healthcare provider.

We can all hope that there will be additional future revenue streams that reward clinical effectiveness as well as cost effectiveness.  In the meantime, those providers who manage staff productivity effectively are going to be in the best position to be successful in both the short and long term.

Stayed tuned for future entries on provider cost effectiveness and productivity.  Comments with proven strategies to improve staff productivity are invited!