RTI International health economist testifies before US House of Representatives on Medicare post-acute care

WASHINGTON – Melissa Morley, Ph.D., senior health economist in the Health Care Financing and Payment Program at RTI, told members of the U.S. House that standardized patient assessment data and additional analyses of the complexities of bundled payment are critical to developing a payment system for episodes of post-acute care.

Testifying before the U.S. House Energy and Commerce Subcommittee on Health, Morley based her comments on risk adjustment models developed by RTI and the Office of the Assistant Secretary for Planning and Evaluation using Post-Acute Care Payment Reform Demonstration data.

According to Morley, the proportion of patients discharged to post-acute care and the use and spending of that care vary significantly in the United States because of medical practice patterns and availability of providers. 

She said that setting an episode-based payment requires an understanding of service use and spending on average.

RTI's research showed the proportional differences of patients discharged to post-acute care, as well as service use and spending across the United States. One example reported 50.5 percent of patients are discharged to these services in Massachusetts compared to 31.9 percent in Montana. Differences in provider supply are also a source of differences in overall spending.

The Bundled Payments for Care Improvement Initiative is testing whether a bundled payment can reduce costs while maintaining or improving quality of care for Medicare recipients. Continued analysis as part of that evaluation will provide valuable information on differences in provider incentives, overall episode use and spending, and cost-shifting and beneficiary outcomes.

Additionally, standardized patient assessment data are not currently collected across post-acute care settings; however, using items from the Continuity Assessment Record and Evaluation (CARE) data, including medical items and items related to functional and cognitive status, as risk adjustors to predict episode spending has potential support the development of risk adjustment models.

"The work that we have done demonstrates the feasibility of moving forward, but more data are needed to test the models on larger samples and to examine significant differences in risk adjustors across diagnosis groups," Morley said.

With the passage of the Improving Medicare Post-Acute Care Transformation Act of 2014, the IMPACT Act, more data may become available over the next several years, yet it is not clear which items will be collected across post-acute care settings and whether the items collected will be sufficient to build an episode-based payment system.