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Contributors
Cynthia Kuttner Wilmington VA Medical Center, Wilmington VA Community
Living Center, Wilmington, DE, USA
ThomasLawrence Geriatric Medicine and Long Term Care, Main Line Health
System, Main Line Health Center, Philadelphia, PA, USA
StevenA.Levenson Baltimore, MD, USA
JoelA.Levien Gastroenterology, Jackson, TN, USA
NaushiraPandya Department of Geriatrics, Nova Southeastern University, Kiran
C Patel College of Osteopathic Medicine, Fort Lauderdale, FL, USA
Department of Geriatrics, Kiran C.Patel College of Osteopathic Medicine, Nova
Southeastern University, Lauderdale, FL, USA
RobertC.Salinas OU Department of Family and Preventive Medicine, Oklahoma
City, OK, USA
Department of Family and Preventive Medicine, The University of Oklahoma,
College of Medicine, Oklahoma City, OK, USA
VernaSellers Madison Heights, VA, USA
DavidA.Smith Geriatric Consultants of Central Texas, Brownwood, TX, USA
Richard G. Stefanacci Thomas Jefferson University, Jefferson College of
Population Health, Philadelphia, PA, USA
Andres Suarez University of Texas Rio Grande Valley School of Medicine,,
Edinburg, TX, USA
KrishnaSuri University Hospitals, Cleveland, OH, USA
KeithA.Swanson Department of Pharmacy: Clinical and Administrative Sciences,
OU College of Pharmacy, Oklahoma City, OK, USA
LauraTrice St. Elizabeth Healthcare, Edgewood, KY, USA
RaghuveerVedala Department of Family and Preventive Medicine, University of
Oklahoma Health Sciences Center, Oklahoma City, OK, USA
CarlynE.Vogel School of Aging Studies, College of Behavioral and Community
Sciences, University of South Florida, Tampa, FL, USA
DeborahWay Palliative Care Services, Corporal Michael J.Crescenz VA Medical
Center, Philadelphia, PA, USA

Contributors
xi
PeterWinn Department of Family and Preventive Medicine, The University of
Oklahoma, College of Medicine, Oklahoma City, OK, USA
Department of Family and Preventive Medicine, University of Oklahoma Health
Sciences Center, Oklahoma City, OK, USA
Sheryl Zimmerman Program on Aging, Disability, and Long-Term Care, Cecil
G. Sheps Center for Health Services Research, University of North Carolina at
Chapel Hill, Chapel Hill, NC, USA

Post-Acute Care andLong-Term Services:
Evolution toValue-Based Care
RichardG.Stefanacci andMitchellA.Kaminski
Introduction
In the past, long-term care (LTC) meant nursing homes and there was no “post- acute
care (PAC)” except for a patient going home after a lengthy hospital stay. As hospital
lengths of stay shortened, the need for transitional post-acute services grew. Nursing
homes stepped up, dedicating some of their beds for post-acute services. Of course,
with this change, competition for protable fee-for-service revenues developed
within both the PAC and LTC space. With the move toward value-based care over
the past decade, PAC and LTC providers are being forced to move from fee for service to global payment strategies. The Quadruple Aim* guides providers to deliver
reductions in total cost of care, improve patient experience and population health
outcomes, and reduce caregiver burden. This represents a seismic shift from LTC in
the past and one that continues to evolve. This chapter discusses these changes.
Because hospitals are paid based upon Diagnosis-Related Groups (DRGs), and
receive a set payment regardless of the length of stay, decreasing hospital lengths of
stay has been a priority for years. Hospitals now prot through shorter lengths of
stay. But, while xed payment based upon DRGs has incentivized reduced LOS for
acute payment, reducing LOS benets organizations that take on risk for total cost
of care as well. The shift in health care delivery from volume to value forces payers
and providers to reconsider the site of care.
The PAC and LTC industries are faced with adapting to change arguably more
than any other segment of the health care industry. Changes in the nances, delivery,
and environment have forced change like never before. Financing PAC and LTSS
and examples of alternative facilities and payment models are summarized in
Table 1. PAC payment is shifting away from fee-for-service, which reimburses
R. G. Stefanacci (*) · M. A. Kaminski
Thomas Jefferson University, Jefferson College of Population Health, Philadelphia, PA, USA
© The Author(s), under exclusive license to Springer Nature
Switzerland AG 2023
P. Winn et al. (eds.), Post-Acute and Long-Term Care Medicine, Current Clinical
Practice, https://doi.org/10.1007/978-3-031-28628-5_1
1

2
Table 1 Financing of PAC and LTSS
Post-acute care (PAC)
Financing Medicare part A Medicaid
Nursing Home/Skilled Nursing
Facility (SNF)
Alternative facilities Long-term acute care
Systems SNF direct admissions
Subacute/SNF-short-term
(ST)
hospital (LTACH)
Inpatient rehab facility
(IRF)
homecare
Hospital preferred SNF
network
Home rst promotion
R. G. Stefanacci and M. A. Kaminski
Long-term services and supports
(LTSS)
Private Pay
SNF-long-term (LT)
Assisted living facility (ALC)
Continuing care retirement
community (CCRC)
homecare
Program for all-inclusive care for
the elder (PACE)
Special needs plans—institutional
(SNP-I)
post- acute providers for what is done, without regard to necessity or clinical outcomes. PAC and LTC providers must now demonstrate true value of care to all
stakeholders including payers, health systems, providers, older adults, and their
families. Providers should include their quality and total cost of care when demonstrating true value of care. Many practices, which had maximized fee-for-service
revenues, for example, through prolonging PAC lengths of stay and providing
unnecessary services, are now unsustainable as providers are incentivized to provide value- based care.
The need for change is evident as 73% of variation in total Medicare spending
occurs in PAC; it is the single-greatest driver of spending variation. According to the
Medicare Payment Advisory Commission (MedPAC) in their March 2019 Report to
Congress, direct spending for PAC represents 8.3% of Medicare FFS spending, and
one of every 4 dollars spent by a Medicare Advantage (MA) plan. Inefcient and
low-quality PAC also drives additional wasteful acute care spending. For accountable care organizations and health plans seeking savings by reducing the total cost
of care, the taming of PAC costs represents a critical approach to bending the cost
curve in healthcare.
In this chapter, we will review the structures of PAC and LTSS, emphasizing
what providers need to know to meet the challenges posed by value-based care
(VBC). Metrics such as SNF length of stay and readmission rates become a key
focus. Tools provided by VBC models, such as the “3-day waiver,” provide leaders
new exibility in care patterns. In addition, clinical goals that promote care coordination across all silos of care challenge leaders to understand and implement new
models of care. Familiarity with the use of data and technology is required.
All of these changes promote the Quadruple Aim (improved quality, efciency,
and patient and provider experience), with a focus on patient-centered care, which
in PAC is offered at the right place, at the right time, and incorporates the wishes and
goals of the patient and family. In addition, there are opportunities to reduce costs
and improve population health outcomes. Caregiver burden, both for formal

Post-Acute Care andLong-Term Services: Evolution toValue-Based Care
professional caregivers and family/friends, can be addressed. Again, like never
before, PAC and LTSS need to evolve to meet new requirements: to remain a critical, valued component of the health care continuum.
3
Long-Term Services andSupports
Skilled Nursing Facility: LT
For patients who are unable to be cared for in their own home, placement in an SNF
may be needed for custodial care. The denition of SNF eligibility is increasingly
critical, as this criterion applies to admission not only to an SNF, but also to an
Assisted Living Community (ALC), via Medicaid waiver programs, as well as the
PACE (Program for All-inclusive Care of the Elderly) program.
Custodial care is care that is primarily for the purpose of assisting the individual
in meeting personal rather than medical needs, which is not a specic therapy for an
illness or injury and is not skilled care. Also, custodial care serves to assist an individual in the activities of daily living, such as assistance in walking, getting in and
out of bed, bathing, dressing, feeding, using the toilet, preparation of special diets,
and supervision of medication that usually can be self-administered. Custodial care
is maintenance care provided by health aides when an individual has reached the
maximum level of physical or mental function. In determining whether an individual is receiving custodial care, the factors considered are the level of care and medical supervision required and furnished rather than the diagnosis, type of condition,
degree of functional limitation, or rehabilitation potential.
Post-acute Facility-Based Care
Medicare Part A benets cover post-acute services in primarily four care settings:
• Home Health Services
• Subacute Skilled Nursing Facility (SNF)
• Inpatient Rehabilitation Facility (IRF)
• Long-Term Acute Care Hospital (LTACH)
The four settings provide an appropriate scope of services covering a range of
acuity. A comparison of key components of each setting is summarized in Table2.
With each step up from Home to LTACH comes a signicant increase in cost.
Because of the shift to value and greater focus on reduction of post-acute care costs
with evidence questioning the need of higher acuity care setting the move has been
to shift to the left toward more home and home-like settings. MedPAC has proposed
Site-neutral payments [1]. Site-neutral payments reect the Commission’s position
that the program should not pay more for care in one setting than in another if the

4
Table 2 Comparison of PAC venues
Home health
services Subacute SNF IRF LTAC H
Type of care
provided
Typical medical
conditions
treated
Daily therapy
requirements
per patient
Average length
of stay
Average cost
per patient
a
https://www.aplaceformom.com/caregiver- resources/articles/in- home- care- costs
Part-time
intermittent skilled
nursing care;
therapy services,
limited home health
aid
Acute and chronic
conditions with
skilled nursing and/
or therapy needs
Intermittent, based
upon medical need
Based upon need;
recertied every
30days
Median cost $24/ha$11,000 $17,000 $38,500
Short-term rehab
typically
following a 3-day
inpatient stay
CHF
COPD
Joint replacement
Infections
1–1.5h >3h N/A
27days 13days 26days
R. G. Stefanacci and M. A. Kaminski
Intensive
rehabilitation therapy
where patient requires
3h of therapy at least
5days per week
Stroke
Neurological disorder
Continued
hospital
level of care
Complex
medical
condition
Complex
wounds
Vent
weaning
Fig. 1 Acuity push-down
care can safely and effectively be provided in a lower cost setting. This shift in acuity of care to lower-cost settings is illustrated in Fig.1: Acuity Push-down.
The shift away from SNF to less expensive home care is also being promoted in
Bundle-based care programs, for example, orthopedists are now incentivized
through these programs, which reimburse based upon 90-day costs around major

Post-Acute Care andLong-Term Services: Evolution toValue-Based Care
5
joint replacement, to discharge patients directly home where they receive rehabilitation services [2].
Home Health Services
Home health services represent a key strategy in providing VBC by supporting earlier acute hospital discharge in a venue that is less expensive, and usually more
comfortable for the patient. CMS provides strict guidelines, which must be met for
care reimbursement.
Medicare Part A (Hospital Insurance) and/or Medicare Part B (Medical Insurance)
cover eligible home health services such as:
• Part-time or “intermittent” skilled nursing care
• Physical therapy
• Occupational therapy
• Speech-language pathology services
• Medical social services
• Part-time or intermittent home health aide services (personal hands-on care)
• Injectable osteoporosis drugs for women
Usually, a home health care agency coordinates the services ordered by a physician. It’s important to realize that Medicare doesn’t pay for:
• 24-h-a-day care at home
• Meals delivered to the home
• Homemaker services (like shopping, cleaning, and laundry), and custodial or
personal care (like bathing, dressing, or using the bathroom) when this is the
only care needed.
All people with Part A and/or Part B who meet all of these conditions are covered:
• They must be under the care of a doctor, and getting services under a plan of care
created and reviewed regularly by a doctor.
• They must need, and a doctor must certify that they need, one or more of these:
– Intermittent skilled nursing care (other than drawing blood)
– Physical therapy, speech-language pathology, or continued occupational ther-
apy services. These services are covered only when the services are specic,
safe, and an effective treatment for the condition. The amount, frequency, and
time period of the services needs to be reasonable, and they need to be complex or only qualied therapists can do them safely and effectively. To be
eligible, either: (1) the condition must be expected to improve in a reasonable
and generally predictable period of time, or (2) a skilled therapist is needed to
safely and effectively develop a maintenance program for the condition, or (3)
a skilled therapist is needed to safely and effectively provide maintenance

6
R. G. Stefanacci and M. A. Kaminski
therapy for the condition. The home health agency providing the care must be
approved by Medicare (Medicare certied).
• The beneciary must be homebound, as certied by a physician.
Patients are not eligible for the home health benet if they need more than parttime or “intermittent” skilled nursing care. They may leave home for medical treatment or short, infrequent absences for nonmedical reasons, like attending religious
services. Patients can still get home health care even if they attend adult day care
Inpatient Rehabilitation Facilities (IRF)
Inpatient Rehabilitation Facilities (IRFs) provide a higher intensity of services than
SNF, within a hospital setting or as free-standing facilities. Acute inpatient rehabilitation services are available for patients requiring acute rehabilitation, dened as
restoration of a disabled person to self-sufciency or maximal possible functional
independence [3]. To qualify for an IRF, patients need to require an interdisciplinary, coordinated team approach that involves a minimum of 3 daily hours of rehabilitation services. Continuation of acute rehabilitation services at an IRF requires
evidence of progress toward stated goals, documented by objective functional measurements [4]. In addition to hospital conditions of participation for Medicare and
Medicaid patients admitted to IRFs, CMS operates under the “60 Percent Rule,” [5]
meaning that a designated percentage of admissions must fall within specic diagnostic categories to maintain IRF accreditation.
Postoperative acute inpatient rehabilitation at an IRF may be considered medically necessary for individuals undergoing more than one major joint replacement during a single hospitalization, but Medicare and other payers typically do
not consider it to be medically necessary when a single joint is replaced.
Exceptions are made when the individual has a serious comorbidity or comorbidities that result in functional decits that necessitate an acute inpatient level
of rehabilitation in order to achieve a satisfactory outcome within a reasonable
time period [6].
Hip and knee replacements, also known as lower extremity joint replacements
(LEJRs), are some of the most common surgeries that Medicare beneciaries
receive [7]. In an effort to control these costs, the Centers for Medicare and Medicaid
Services (CMS) implemented the Comprehensive Care for Joint Replacement
Model [2]. Within the model, a bundled payment is provided on the basis of a quality measurement for the complete episode of care associated with a hip or knee
replacement. The Comprehensive Care for Joint Replacement Model aims to hold
hospitals, physicians, and post-acute care providers nancially accountable for the
quality and value of the care they deliver to Medicare beneciaries for hip and knee
replacements. This nancial accountability begins with surgery and continues
through to recovery. Additionally, the episode of care structure encourages health
care providers to increase their coordination of care.

Post-Acute Care andLong-Term Services: Evolution toValue-Based Care
7
Long-Term Acute Care Hospital (LTACH)
Care provided by an LTACH is hospital-based care, as such, admissions require
documentation that patients have a complicated course of recovery that requires
prolonged hospitalization.
Treatment at an LTACH may be required in the face of complex medical issues
that meet the criteria of two or more medically active conditions that require:
• Three or more interventions including intravenous medications
• Continuous intravenous uids (but not a “keep vein open” order)
• Total parenteral nutrition or peripheral parenteral nutrition, and blood products
• At least one physician visit per day
• Frequent diagnostic services
• Active participation in therapies at least 5days per week
Beyond general complex medical issues, the other two major categories that may
require LTACH level of care include complex wound/burns and mechanical ventilation weaning.
Subacute/SNF-ST
Short-term subacute care or SNF-ST is a distinct form of health care service that
focuses on providing the skilled medical care needed to transition the patient to the
home setting after a qualifying acute-care hospitalization. Although the qualifying
hospitalization has historically required a minimum of 3 days, Medicare and managed care plans are increasingly granting waivers to this requirement in an effort to
decrease the hospital length of stay. The waivers allow a patient to be directly admitted to SNF or after an acute hospital stay of less than 3days’ duration. There is
further discussion of the 3-Day Rule Waiver below. The use of these waivers has
also increased in response to COVID-19 with the need to avoid hospitalizations.
Subacute care may be used specically for rehabilitation purposes for any number of conditions. In general, the rehabilitation needs of patients in these settings
include fewer than three treatment modalities and most often physical therapy.
Beyond the need for physical therapy, patients can also qualify for subacute services under one of the following categories:
• Observation
• Assessment
• Monitoring of a complicated or unstable condition
– Complex teaching services to the individual or caregiver requiring 24-h SNF
setting versus intermittent home health care setting
– Complex medication regimen
– Initiation of tube feedings; active weaning of ventilator dependent individuals
– Wound care (including decubitus/pressure ulcers)

8
R. G. Stefanacci and M. A. Kaminski
Although Medicare Part A benet covers up to 100 days of subacute services
during a benet period, most stays in subacute care facilities are much shorter than
that, lasting 21days on average. This length of stay is in part because of the Medicare
benet, which covers 100% of the rst 20days and then from days 21–100, requires
a daily $185.50 coinsurance from the beneciary [8]. There must be daily documentation of the patient’s progress or complications in order to maintain coverage of
subacute care.
Direct Subacute Admissions
The cost of most hospital stays exceeds $2000 per day, while SNF costs are typically less than a quarter of that. Because hospitalization represents the greater
expense, care had been moving from the hospital setting to SNF.But organizations
taking on risk for total cost of care will reduce costs further when patients are sent
home, when appropriate, instead of to an SNF.For example, through a “Home First”
strategy, providers now perform previously inpatient procedures, such as joint
replacement, in outpatient settings from which the patient can go directly home.
SNF rehabilitation stays are reduced. Paradoxically while hospitals are working
toward fewer admissions, SNFs benet from increased admissions and occupancy.
Direct admission to SNF was not reimbursed by CMS until recently, when the 3-day
waiver, discussed below, was developed for organizations participating in riskbased, value-based care models [9]. These direct admissions for other conditions
will allow SNFs an alternative opportunity to increase their occupancy rate.
Direct admissions will be coming from managed care organizations, hospice,
private respite, and, most recently, risk-bearing Medicare FFS ACOs, but only to
those SNFs that are prepared to handle this process—a process signicantly different than the traditional admission, which is a transition from the hospital. Those
SNFs appropriately equipped to handle direct admissions will benet from improved
clinical and nancial outcomes.
In order to avoid inappropriate use of SNF, CMS put into place the 3-Day Rule
in 1965. To qualify for Skilled Nursing Facility (SNF) extended care services coverage, Medicare patients were required to meet the 3-day rule before SNF admission.
The 3-day rule requires that the patient have a medically necessary 3-day- consecutive
inpatient hospital stay. The 3-day-consecutive stay count doesn’t include the day of
discharge, or any pre-admission time spent in the ER or outpatient observation.
While Medicare Advantage programs, and risk-bearing accountable care organizations (ACOs) have been able to be granted a waiver for this requirement, the
Three-Day Rule remains in place for traditional FFS Medicare beneciaries. A temporary waiver of the 3-day rule was put into place in 2020 due to the COVID-19
Pandemic, but was expected to be reversed in 2021. This temporary waiver promoted hospital bed access for COVID-19 patients in 2020. Patients with COVID-19
could be admitted to SNFs, when medically appropriate, with the temporary 3-Day
Waiver. The waiver is available if: (1) the beneciary does not reside in a nursing
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