Post-Acute Care (PAC) Optimization in a Value-Based Economy

Bridging the Gap between Hospital and Home


  • Shawn Wesley Matheson, MBA, LNHA, FACHCA Independence University


Post-Acute Care, Care Coordination, Care Management, Value-Based Care


Post-acute care (PAC) covers a range of health care services after hospitalization, including Long-Term Acute-Care (LTAC) hospitals, Inpatient Rehabilitation Facilities (IRFs), Skilled Nursing Facilities (SNFs), and Home Health (HH) agencies.

Historically, health systems had little reason to closely integrate with PAC providers or even examine PAC providers on measures of cost and quality, largely because payment mechanisms did not incentivize shared accountability. However, today’s value-based environment is different:

  • Hospitals now have 30-day cost risk from the Hospital Readmissions Reduction Program (HRRP)
  • Hospitals and medical groups are involved with various 90-day bundles
  • Accountable Care Organizations (ACOs) are expanding
  • MACRA will affect physician reimbursement in 2019

This trend toward value-based payments increasingly holds health systems accountable for post-acute spending and care, and a health system’s success relies increasingly on PAC providers’ cost, quality, and overall ability to manage patient care. Partnering along the PAC continuum, therefore, has become the next frontier of opportunity and savings for risk-bearing entities, especially Integrated Delivery Networks (IDNs), ACOs, and bundled payment awardees.

At the same time, there has been a dramatic increase in PAC costs. According to MedPAC’s March 2017 Report, spending on PAC services has more than doubled since 2001, growing from $27 billion in 2001 to $60 billion in 2015, faster than any other Medicare spending category. Consequently, health systems are now seeking more clarity on the appropriate site of care and ways to better manage these care providers, rather than choosing PAC based on availability or local practice patterns.

A PAC management model can manage care as well as the providers that provide this care, either from within an IDN/ACO or outsourced to a PAC management solution.





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