Bundled payment participants wary of SNF 3-day stay waiver, report finds

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Less than half of the providers eligible to use the three-day hospital stay waiver through the Bundled Payments for Care Improvement initiative actually utilize it, a new report shows.

The waiver allows hospitals participating in BCPI to discharge Medicare beneficiaries to a three-star or higher skilled nursing facility without meeting the traditional three-day stay requirement for skilled nursing coverage. Previous reports have cast doubt on the usefulness of a similar waiver within accountable care organizations, due to declining hospital lengths of stay.

A new report on BCPI, published Thursday by the Centers for Medicare & Medicaid Services and the Lewin Group, finds healthcare organizations may be shying away from using the waiver due to concerns about its effect on post-acute care.

Seventy one providers — or 62.8% of the total organizations in BCPI's Model 2 — have the ability to use the three-day stay waiver, the report found. Model 2 includes patients' hospital stays, concurrent services and all post-discharge services within the episode.

Just 29 of episode-initiating providers (25.7% of total providers) actually used the waiver in the third quarter of 2014. That finding reflects earlier reports of low waiver use from late 2013 to late 2014.

Some BCPI participants believed that the waiver could bring the “unintended consequence” or driving up skilled nursing utilization, especially in cases where a beneficiary could go home and receive home health services.

Other providers showed “cautious optimism” about the waiver, the report found, with many finding the waiver a positive provision of the program but expressing concerns about its implementation, effect on care partners and potential financial risk for both providers and beneficiaries if the waiver is used incorrectly.

“The [hospital three-day stay] waiver on one hand is a good thing, but on the other hand, there are some cracks in the process that can show up and then be problematic for us and our partners,” one provider reported.

Click here to read the full BCPI report, which includes information on the results for Models 2, 3 and 4, as well as the impact the program had on skilled nursing facilities participating in orthopedic surgery, respiratory and cardiovascular episodes.