Although Medicare‘s looming financial penalties for hospitals with excessive readmissions might seem like a blunt weapon, private health plans often have the flexibility to negotiate with partnering hospitals around incentives for readmissions prevention.
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"We have arrangements with private insurance companies where we put at risk future compensation, based on achieving negotiated readmissions results," says Mark Carley, vice president of managed care and network development for Centura Health, a 13-hospital system in Colorado.
Payors, including United Healthcare, have developed their own readmissions programs and reporting mechanisms, although each program’s incentives are a little different, Carley says. Target rates are negotiated based on each hospital’s readmissions in the previous 12-month period and national averages. The plan can also provide helpful data on its beneficiaries and other forms of assistance, because it wants to see the hospital hit the target, he adds. "If the target has been set too high, they may be willing to renegotiate."
But the plan doesn’t tell the hospital how to reach that target.
"Where the complexity comes in is how we as a system implement internal policies and procedures to improve our care coordination, discharge processes, follow-up, and communication with downstream providers," says Carley. Centura Health’s approach to readmissions has included close study of past performance data in search of opportunities for improvement, fine-tuning of the discharge planning process, and follow-up phone calls to patients and providers.
"In addition, we are working with post-acute providers to provide smoother transitions in the discharge process," he says.