Hospital-Skilled Nursing Facility Integration and Participation in a Bundled Payment Initiative

Reduced institutional postacute care has been associated with savings in alternative payment models. However, organizations may avoid voluntary participation if participation could threaten their own revenues.

To characterize the association between hospital-skilled nursing facility (SNF) integration and participation in Medicare's Bundled Payments for Care Improvement Advanced (BPCI-A) program.

This is a cross-sectional analysis of hospital participation in BPCI-A beginning with its launch in 2018. Each SNF-integrated hospital was matched with 2 nonintegrated hospitals for each of 4 episode-specific analyses. Fifteen hospital-level variables were used for matching: beds, case mix index, days, area SNF beds, metropolitan location, ownership, region, system membership, and teaching status. Hospitals were also matched on episode-specific volume, target price, and the interaction of target price and case mix. Episode-specific logistic models were estimated regressing hospital participation on integration and the previously listed variables. The marginal effect of integration on participation was then calculated. Analysis took place from August 2022 to May 2024.

Hospital-SNF integration, as defined by common ownership and referral patterns and identified using cost reports, Medicare claims, and Provider Enrollment, Chain, and Ownership System records. Additional sources included records of target prices and participation, the Area Health Resources File, and the Compendium of US Health Systems.

Participation in BPCI-A.

In total, 1524 hospitals met criteria for inclusion in the hip and femur (HFP) analysis, 1825 were included in the major joint replacement of the lower extremity (MJRLE) analysis, 2018 were included in the sepsis analysis, and 1564, were included in the stroke-specific analysis. Across episodes, 191 HFP-eligible hospitals (12.5% of HFP-eligible hospitals), 302 MJRLE-eligible hospitals (16.5%), 327 sepsis-eligible hospitals (16.2%), and 185 sepsis-eligible hospitals (11.8%) were SNF integrated. In total, 79 hospitals (5.2%) participated in the HFP episode, 128 (7.0%) participated in the MJRLE episode, 204 (10.1%) participated in the sepsis episode, and 141 (9.0%) participated in the stroke episode. Integration was associated with a 4.7-percentage point decrease (95% CI, 2.4 to 6.9 percentage points) in participation in the MJRLE episode. There was no association between integration and participation for HFP (0.5-percentage point increase in participation moving from nonintegrated to integrated; 95% CI, -2.9 to 3.8 percentage points), sepsis (1.0-percentage point increase; 95% CI, -2.2 to 4.2 percentage points), and stroke (0.3-percentage point decrease; 95% CI, -3.1 to 3.8 percentage points).

In this cross-sectional study, there was an uneven association between hospital-SNF integration and participation in Medicare's BPCI-A program. Other factors may be more consistent determinants of selection into voluntary payment reform.