Legal and Regulatory Compliance

A Perfectly Legal Way to Help Patients Pick Higher-Quality Post-Acute Providers

April 16, 2015 10:09 am

Hospitals are increasingly held accountable for patients’ post-discharge outcomes, thus giving them incentive to help patients choose high-quality post-acute providers. However, a new study finds that many hospital case managers erroneously think they will be breaking the law if they share quality reports on post-acute providers with patients and their families.


It is axiomatic that patients have the right to select their own healthcare providers. This principle was codified in federal law at least as early as July 30, 1965, the day Medicare took effect. The Medicare “patient freedom of choice” provision, as it is known, reads:

Any individual entitled to [Medicare] benefits … may obtain health services from any institution, agency, or person qualified to participate [in the Medicare program] if such institution, agency or person undertakes to provide him such services ( 42 U.S.C. § 1395a(a)).

Similar language guarantees the right for Medicaid beneficiaries. The principle is buttressed by numerous court decisions, by various fraud provisions and by regulations such as the discharge planning requirements of the Medicare Conditions of Participation (See  42 C.F.R. § 482.43).

Yet hospitals are increasingly being held accountable for the quality of care, during the acute-care stay and beyond. If a hospital discharges a patient to skilled nursing facility (SNF), and that patient is later readmitted for pressure ulcers or other complications, then the hospital risks getting slapped with readmission penalties from Medicare.

Given this, it is in the hospital’s interest—not to mention the patient’s—to facilitate the choice of a high-quality home health agency or skilled nursing facility. Thus, the question arises: How can hospitals share unbiased information about the quality of care at a post-acute provider without violating any laws.


Balancing Patient Autonomy and Safety

In the hospital setting, it usually falls on case managers or discharge planners to help patients make wise decisions about post-acute care. The case manager must tell the patient or the patient’s family about their freedom to choose and must disclose any financial interest that the hospital has in a home health agency or skilled nursing facility. “The hospital must not specify or otherwise limit the qualified providers that are available to the patient” ( 42 C.F.R. § 482.43[c][7]).

In other words, to make an intelligent choice, patients must have unbiased information about what providers are available for the care they need, and it is a conflict of interest for hospital personnel to steer patients to post-acute providers affiliated with the hospital. For these reasons, conscientious discharge planners typically provide patients with a list of qualified providers but do not make specific recommendations on which ones are preferred.

Yet there is a way for discharge planners to legally provide unbiased information about home health agencies and skilled nursing facilities to patients. Medicare’s Home Health Compare and Nursing Home Compare websites have information about the quality of care provided by Medicare-certified home health agencies and skilled nursing facilities throughout the nation. These sites allow patients and families to learn how well various providers cared for their patients, how often they used best practices, and what other patients said about their experience. The sites allow patients to search by location or by provider name and provides checklists and other helpful information.

These online quality reports can be used as tools by case managers who want to help patients differentiate among providers, while supporting patient autonomy. Some states, such as Rhode Island and New York, have similar online quality reports.

Identifying Barriers

A study published recently in the Journal of General Internal Medicine points to the need to educate case managers about the availability of quality reports. Interviews and focus groups with 28 case managers and 13 home health consumers at five Rhode Island hospitals revealed that no one was aware of Rhode Island’s or the federal home health quality reports.

“It was huge surprise to us,” author Rosa R. Baier of Brown University said. “Consumers wanted access to more information that could inform their decision, but they weren’t getting it.”

Rhode Island may not be the only state where consumers aren’t seeing quality reports. The researchers informally surveyed another 40 case managers in five other states, finding that in 7 out of every 8 cases, those managers also shared only bare bones lists with no quality information from, or references to, online reports.

“The process in other states seems very similar to what is happening in Rhode Island,” Baier said.

The focus groups yielded other insights about barriers to informed decision making. Most importantly, case managers confessed feeling that federal laws or hospital policy prohibited them from answering patients’ questions about which agency they should choose. And although they can share unbiased quality information—if they have any—the case managers apparently feel constrained by the laws from doing so.

One case manager in the study said she basically tells patients and families: “I can’t tell you what everybody does, and I can’t make decisions for you. I can’t help you choose.”

The study’s senior author, Melissa Clark, a professor at the Brown University School of Public Health, said the findings are notable in light of recent changes in healthcare policy designed to reward quality outcomes. “Arming case managers with existing home health quality reports could improve overall care quality.”

That said, quality reports are not yet perfect, and the data on these sites needs to be considered in light of other information about a post-acute provider, including first-hand accounts of friends/family. For instance, the website maintained by the New York Department of Health states: “Where possible, quality of care measurements are provided. Please be mindful that while we believe these quality measures are among the most reliable, measuring quality is difficult because of variations among agencies in the types of patients for whom they care.”

Educating Case Managers

The authors encourage state agencies to be more assertive in pushing quality reports directly to case managers. And they say case management departments should regularly access the reports and make them available to discharge planners.

For their part, compliance officers and legal counsel should educate case managers about the patient choice laws so they understand what is permissible. They can also explain how to help patients make informed decisions without restricting the patient’s freedom to choose.

“Case managers can be a reliable conduit to share information directly with consumers during discharge planning, but only if they are aware of existing resources and feel able to use them,” Baier said. “Public reports should be marketed as tools that case managers can use to help patients differentiate among providers, while supporting patient autonomy.”

Stefan Gravenstein, MD, a Healthcentric Advisors investigator on the study and a geriatrician at University Hospitals in Cleveland, adds that public reports can serve as a neutral resource to help case managers abide by patient choice laws. “Although directing patients to choose specific providers may create a conflict of interest,” he says, “pointing them towards government data intended to help them make better choices makes inherent sense.”

J. Stuart Showalter, JD, MFS, is a contributing editor for HFMA.

Interviewed for this article:
Rosa R. Baier, MPH, is associate director, Brown University Center for Long Term Care Quality & Innovation, and consulting senior scientist, Healthcentric Advisors, Providence, RI.

Melissa Clark, PhD, is professor of epidemiology, Brown University School of Public Health, Providence, RI.

Stefan Gravenstein, MD, MPH, is director, Center for Geriatric Medicine, University Hospital-Case Medical Center, Cleveland, Ohio.

Discussion Starters

Forum members: What do you think? Please share your thoughts in the comments section below.

  • How does your hospital handle giving patients information on post-acute providers?
  • Does your state publish quality data on post-acute providers?


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