Rehabilitation costs: implications for prospective payment

Area of Science:

• Health Services Research
• Healthcare Economics
• Geriatric Medicine

Background:

• Medicare prospective payment systems aim to standardize reimbursement for post-acute care.
• Rehabilitation facilities (RFs) and skilled nursing facilities (SNFs) provide distinct post-acute care settings.
• Understanding resource utilization differences is crucial for payment model development.

Purpose of the Study:

• Compare service utilization, length of stay, case mix, and resource consumption between RFs and SNFs for Medicare patients.
• Inform the development of prospective payment systems for rehabilitation and skilled nursing facilities.

Main Methods:

• Longitudinal analysis of Medicare hip fracture and stroke patients (n=996) admitted to RFs and SNFs.
• Two-group comparisons of RFs versus SNFs, with regression analysis to adjust for patient case mix and other factors.
• Data collected on patient case mix, service utilization, and resource consumption.

Main Results:

• RF patients had shorter lengths of stay but higher ancillary resource consumption per stay compared to SNF patients.
• Ancillary resource differences were more pronounced for stroke patients.
• Adjusted nursing resource consumption differences were smaller and not statistically significant for hip fracture patients.

Conclusions:

• An integrated approach to developing prospective payment for RFs and SNFs is beneficial.
• Condition-specific per-stay payment methods applicable to both settings warrant consideration.
• Differences in resource consumption highlight the need for nuanced payment strategies.