The momentum behind value-based care continues to grow, but providers in Long-Term and Post-Acute Care (LTPAC) face significant hurdles. According to Eugene Gonsiorek, PhD, Vice President of Clinical Regulatory Standards at PointClickCare, the current system pressures providers to deliver more services with fewer resources, often under tighter timelines.
For the past 25 years, financial strategies in LTPAC have revolved around two core factors: occupancy rates and payer mix. Approximately 70% of residents receive Medicaid coverage, while the remaining residents rely on Medicare fee-for-service, Medicare Advantage, or private pay options. While fee-for-service reimbursement can range from $650 to $700 per day, Medicaid often pays around $250, which is typically below actual care costs. Historically, higher Medicare rates have helped to bridge this financial gap, but that support is diminishing.
The landscape is evolving rapidly, with more than half of Medicare beneficiaries now enrolled in Medicare Advantage. These plans generally offer lower payments, require more prior authorizations, and introduce additional oversight, resulting in increased administrative burdens for care teams. This shift places substantial financial pressure on providers who are tasked with managing higher-acuity patients under more complex conditions.
Transforming Expectations in LTPAC
While consensus exists on the overarching goal of achieving better healthcare outcomes and reducing hospitalizations, the reality for providers is often different. Investments in staffing, new tools, and operational changes do not always yield proportional returns in referrals or reimbursement rates. Moreover, the complexity of managed care adds to the administrative workload, detracting from clinical decision-making and overwhelming LTPAC teams.
The push for faster adoption of value-based care is not inherently flawed, but it overlooks critical realities faced by providers. Many LTPAC facilities seek to embrace these changes, yet they require a pathway that acknowledges their unique starting points. Discussions often center around large, multi-facility operators, leaving smaller, independent providers without adequate support.
Effective leadership is essential to navigating these challenges. Providers need actionable data that transcends basic dashboards and reports—information that can inform real-time decision-making. Moreover, tools should alleviate pressure on frontline staff rather than exacerbate it. Recognition of the efforts already made by providers is crucial in fostering an environment conducive to meaningful change.
Navigating Towards the 2030 Goal
The goal set by the Centers for Medicare & Medicaid Services (CMS) aims for all Medicare and Medicaid fee-for-service payments to be linked to value-based care by 2030. However, the lack of alignment between incentives and operational realities often translates to added pressure rather than progress for LTPAC providers. With staffing already stretched thin and care delivery increasingly complex, organizations find it challenging to focus on long-term improvements amid daily operational demands.
Providers urgently need time and flexibility to develop value-based models that genuinely suit their circumstances. Rapid changes or insufficient support can exacerbate existing issues, leading to staff burnout and a resource crisis. This could hinder long-term strategic planning in favor of short-term fixes that fail to address the root problems.
Achieving the right pace for change is critical. When the tools and goals in place do not align, even the most well-intentioned models can falter. Providers are not resistant to the concept of value-based care; rather, they seek conditions that facilitate success. The solution lies not in accelerating the process, but in ensuring a smarter alignment of resources and support systems.
To realize the potential of value-based care, stakeholders must engage in active listening to understand the real challenges providers face. Simplifying processes, offering targeted support, and avoiding unnecessary complexity can pave the way for more effective implementation.
Ultimately, the transition to value-based care represents a significant opportunity for healthcare improvement. However, achieving this goal requires a concerted effort to align financial models, workflows, and policy expectations with the realities of care delivery. By fostering a sustainable path forward, the healthcare system can better support both patients and providers in this evolving landscape.
