Few ACOs interested in 3-day stay waiver for skilled nursing, experts say

The waiver allows hospitals to skip the three-day stay and dischargepatients into SNFs that have at least a three-star rating
The waiver allows hospitals to skip the three-day stay and dischargepatients into SNFs that have at least a three-star rating

Few accountable care organizations are lining up to waive the three-day stay requirement for skilled nursing facilities, causing some healthcare experts to wonder if the waiver is still relevant.

The three-day stay waiver, which is set to kick in for Shared Savings Program ACOs in January 2017, allows providers to sidestep the three-day hospital stay requirement if a Medicare beneficiary is discharged to a skilled nursing facility with at least a three-star rating. The waiver will be available only to ACOs participating in Track 3 of the SSP program, where providers can reap rewards if they demonstrate improved quality and reduce spending but face the risk of penalties if they don't.

So far 95% of ACOs are still on Track 1, a one-sided shared savings model, according to a report published Monday by Modern Healthcare. The deadline for ACOs to apply to either use the waiver or become a Track 3 organization is quickly approaching its July 29 cutoff.

That lack of interest has cast some doubt on whether the three-day stay rule still holds water as part of the Medicare program.

“As care improvements and efficiencies are gained — and as hospital average length of stay continues to decline — the relevance of the three-day rule as a clinical tool disappears,” James Michel, senior director of Medicare reimbursement and policy for the American Health Care Association, told Modern Healthcare.

The Medicare program could benefit from eliminating the three-day stay rule, and turning instead to nursing homes as a “low-cost alternative to hospitals,” Michel added. Some experts also suggested that the waiver may pressure hospitals to discharge patients into skilled nursing facilities sooner than they should.