When it comes to readmission penalties, 1996’s Jerry Maguire has nothing on today’s C-Suite. With 1% of hospitals at the maximum (3%) penalty, 55% of hospitals penalized in FY 2015 and a weighted average penalty of 0.63%, there are real monies at risk. Combine those numbers with the addition of two DRGs (Chronic Obstructive Pulmonary Disease and Joint Replacements) this year, and you’ve got the perfect setting for a Show Me the Money plot right in the C-Suite of your local hospital. Best of all, their financial pain is your opportunity gain. So, where to start?
Find the money trail
- Go to Kaiser Health News to see if a specific hospital is being penalized and by how much.
- Use Hospital Compare to see how a specific hospital’s re-admission rates stack up on the current 3 penalty DRG’s.
Anticipate the money flow
Since penalty quartiles are essentially annually moving targets, you need to see what quartile your hospital account is in now. This can show, not only if your hospital account is in the penalty quartile but how close to the penalty quartile they are, affording you further opportunity for discussion. (HealthMR does have a Readmission Rate Analysis) that assists with this process.)
Explain why you’re the best investment
Articulate the best practices which contribute to your agency’s lower readmission rate. How are you differentiating yourself? Do you offer specialized approaches on key DRGs? Explain why your agency is better…and then take the next step:
Show them the money
Quantify how many readmissions could be avoided with referrals to your agency.
- Estimate market share at the local hospital for you and your competitors. You can use internal data for this, from your CRM system or HealthMR’s Home Health Hospital Market Share report.
- Estimate 30-day readmission rates for you and your competitors. You can use the data from HomeHealthCompare (http://www.medicare.gov/homehealthcompare). Although this is general readmission data, if you’re performing well here, then it is pretty safe to assume you’ve got the 30-day readmission nailed too.
- Obtain the number of Medicare patients discharged to home health from each current and future penalty DRG for that hospital along with overall home health discharges. You can use internal data, data from your CRM system or HealthMR’s Medicare Hospital Home Care Discharges by DRG Report.
- With these numbers, figure a weighted average for the hospital regarding how many of your patients would be readmitted versus your competition.
- Now you can estimate how many readmission cases would be avoided if your agency was handling all the home health patients. (See the chart: Readmission Reduction Calculation – Example)
Although these numbers are estimates, they do put some quantifiable elements to the readmission solution. This process shows them the money – the number of readmissions that could be avoided by giving your agency an “exclusive.” This quantified ($$$) approach will increase your odds of success in selling to the C-Suite.