States must change the way they pay for nursing home services as they transition to managed care, and luckily they have multiple options to do so, according to a new report released Friday by Advancing States.
Findings indicate that “early, frequent and ongoing” stakeholder engagement with providers is the key to a successful transition.
“Successful [long-term services and supports] reform requires careful consideration of changes that may be needed to existing Medicaid financing structures, in particular for nursing facility services,” said Jill Herbold, report co-author and consulting actuary for consulting firm Milliman.
The authors noted that historical approaches used by state Medicaid agencies to finance nursing home services have been challenged with efforts to reform LTSS. This is particularly true as states try to transition to managed care — with a large majority of them using provider taxes on facilities as a financing source for non-federal program expenses.
Medicaid programs must carefully plan to transition payments to nursing home services while also ensuring everything is still in line with federal regulations, researchers said about the shift from traditional fee-for-services,
Investigators found several options available based on interviews with five states’ Medicaid agencies:
- Transition supplemental payments to short-term pass-through payments
- State directed payment arrangements (mostly through minimum fee schedules)
- Standardize and update nursing facility reimbursement, value-based payment strategies and diversification of services provided by nursing homes.
One strategy that was a common denominator among all five states: the need for ongoing strategic and nuanced stakeholder engagement, report authors concluded.
“Stakeholder engagement allows for building consensus regarding the overall goals and objectives of the reform, how they will be operationalized, and how progress toward those goals and objectives will be measured and evaluated,” the report stated.
“Developing a formal and frequent stakeholder engagement plan is necessary to clearly articulate the state’s strategies, clarify roles and responsibilities, and identify timelines,” the analysis said. “Given the long-term nature of LTSS reforms, it may be necessary to develop short- and long-term stakeholder engagement plans that are updated over time to reflect project challenges and successes.”
The full report can be found here.
