Families Are Choosing Home Healthcare Over Nursing Home Placements for Elderly Relatives Because of COVID-19

Occupancy rates at skilled nursing facilities remain well below pre-pandemic levels, a trend that weakens the financial health of nursing homes and means fewer test referrals to clinical laboratories that service them

COVID-19 is taking a financial bite out of the nursing home industry as seniors opt for home care rather than entering nursing facilities. If this trend becomes permanent, clinical laboratories may have to ramp up their ability to collect specimens from a growing population of patients who choose non-traditional healthcare settings. And as the SARS-CoV-2 pandemic stretches on, the exodus of seniors from nursing home facilities provides another example of how COVID-19 is altering consumers’ access to healthcare.

According to the most recent “AARP Nursing Home COVID-19 Dashboard Fact Sheets,” the COVID-19 pandemic “has swept the nation, killing more than 160,000 residents and staff of nursing homes and other long-term care facilities.”

Because COVID-19 has hit nursing home residents the hardest, many families have decided elderly parents may be safer living with relatives than in nursing homes that have proven vulnerable to widespread outbreaks. In addition, COVID-19-related lockdowns in skilled nursing facilities (SNFs) have provided families with additional motivation to choose home care for elderly relatives. 

For example, in “Should You Bring Mom Home from Assisted Living During the Pandemic?” retired Seattle physician Alison Webb, MD, told Kaiser Health News (KHN) she moved her 81-year-old father, who has moderate dementia, out of assisted living so he could be with grandchildren and enjoy gardening rather than remain in his senior facility, where COVID-19 protocols kept him sequestered from friends and family.

This is not an isolated example and may have a long-term impact on clinical laboratories that service skilled nursing facilities.

Patient Volume Falls Dramatically at Skilled Nursing Facilities

While hospital discharge rates are rebounding to near pre-pandemic levels, an Avalere Health analysis of Medicare fee-for-service claims found a “more drastic and lasting decline in patient volume” at skilled nursing facilities. In contrast, Avalere found home health has experienced a rebound in patient numbers beginning last May.

“In the early months of the COVID-19 outbreak in the US, we saw a substantial decrease in hospital discharges to both skilled nursing facilities and home health agencies,” said Heather Flynn, Consultant at Avalere, in an Avalere press release. “Hospital discharges are steadily moving back to pre-pandemic levels, but our analysis points to an uneven ‘return to normal’ across care settings.”

The graph above, taken from the Avalere press release, reveals “a stark decline in inpatient hospital discharges and discharges to both SNF and home health beginning in February 2020. The analysis further indicated that the skilled nursing industry has experienced a more drastic and lasting decline in patient volume relative to total hospital volume and discharges to home health (where rebounds were observed beginning in May). Of note, discharges to home health experienced a year-over-year increase in June 2020, at 4.6% greater discharge volume when compared to June 2019, while discharges to SNF remained notably below pre-pandemic levels at a 25.4% decrease in year-over-year discharges.” (Graphic copyright: Avalere Health.)

Bill Kauffman, CFA, Senior Principal at National Investment Center for Seniors Housing and Care (NIC), believes the skilled nursing industry may be experiencing a permanent prolonged reduction in occupancy levels.

“Skilled nursing facility occupancy typically slows in April after an uptick during the flu season, but we haven’t seen anything like this in recent memory,” Kauffman said in an NIC press release which announced nursing home occupancy had dropped to 78.9% last April, 2020, down 5.5% from 2019. “The long-term effect of COVID-19 on skilled nursing occupancy remains to be seen as the industry adjusts to a new normal.”

Since then, the occupancy rate in skilled nursing properties has fallen even further. The latest Skilled Nursing Monthly Report announced a new low of 74.2%.

Will Clinical Laboratories That Service Skilled Nursing Homes Be Affected?

Low occupancy rates may be pushing the nursery home industry toward a financial crisis. According to an August 2020 survey conducted by the American Health Care Association (AHCA) and National Center for Assisted Living (NCAL), 55% of the nation’s nursing homes are operating at a loss and 89% operate with a profit margin of 3% or less.

Mark Parkinson (above), President and CEO of the AHCA and former Governor of Kansas, maintains a successful COVID-19 vaccination rollout and lifting of nursing home visitation bans are keys to the industry’s recovery. “I think the census needs to recover about 1% a month. If we can recover 1% a month on a steady basis, that gets us to the end of 2021,” Parkinson told Skilled Nursing News. “And we’re still down, but we’re down 5% or 6%; we’re not down 13% or 14%. If we recover a half a percent, some businesses will be okay, but not all. If we only recover half a percent, we don’t get any more money, folks are going to have problems. If we don’t have any recovery on census … things are very, very bad.” (Photo copyright: Kansas Health Institute.)

There are signs the nursing home industry may have to contend with home healthcare becoming a permanent competitor for patients. In a news release last spring, the Mayo Clinic announced it was partnering with Medically Home of Boston to launch a virtual hospital-at-home model aimed at delivering “advanced care” from a network of paramedics, nurses, and support team in a home care setting.

The initiative means patients can receive a range of healthcare services in their homes that traditionally required a hospital setting. The services include:

  • Infusions,
  • Skilled nursing,
  • Clinical laboratory and imaging services,
  • Behavioral health and rehabilitation services.

While the initial program rollout will allow Mayo Clinic to free up ventilators and hospital space for COVID-19 patients, John Halamka, MD, an emergency medicine physician and President of Mayo Clinic Platform, told Modern Healthcare, “Next, we’ll look to forward-thinking organizations who believe like we do in that care should be more convenient and accessible.”

Discharge Doctors Now Choose Home Healthcare Over Skilled Nursing Facilities

Physicians also are embracing home care in greater numbers. As reported in Forbes, a 2020 William Blair survey showed 81% of physicians responsible for discharge planning would send patients to a home health agency rather than a skilled nursing facility. Pre-pandemic, only 54% of discharging physicians expressed a preference for home care, according to the survey.

Greg Chittim, Partner at Health Advances, an international strategy consulting firm headquartered in Boston, points to improvements in virtual technologies as the catalyst for home care’s growth.

“One of the silver linings of COVID-19 is the level of investment we are seeing in virtual care technologies,” Chittim told Forbes. “And beyond the technologies, providers and patients are building that comfort with traditional real-time communication. I think we have moved 10 years ahead in 10 months.”

As the COVID-19 pandemic rolls on and home health initiatives become more commonplace and grow in popularity, clinical laboratory managers may want to develop solutions that assist home healthcare providers with collecting and shipping patient specimens for testing.

—Andrea Downing Peck

Related Information:

Decline in Skilled Nursing Occupancy Continues Due to COVID-19 Pandemic

Hospital Discharges to Home Health Rebound While SNF Volumes Lag

Survey: Nursing Homes Incurring Significant Costs and Financial Hardship in Response to COVID-19

Mayo Clinic Launches Advanced Care at Home Model of Care

Mayo Clinic to Launch National Hospital-at-Home Model

Skilled Nursing Occupancy Reached New Low in November 2020

While Hospital Discharges to Home Health Rebound, SNFs See Drastic and Lasting Decline

Home Healthcare Is a Bright Light During COVID-19 with an Even Brighter Future

Coronavirus Fraud Takes Many Forms as Federal and Local Officials Continue to Pursue Widespread Cases of Clinical Laboratory Testing Scams

Since the pandemic began, federal investigators are specifically looking for patterns of fraud in Medicare claims data for COVID-19 clinical laboratory testing

Last month, the federal Department of Health and Human Services (HHS) Office of Inspector General (OIG) announced it had been investigating trends in Medicare claims data that could indicate patterns of fraud in the billing for COVID-19 clinical laboratory tests, Modern Healthcare reported.

Stretching back to at least March, fraudulent actors offering fake SARS-CoV-2 tests have preyed on vulnerable Americans in a wide variety of ways during the public health emergency, according to published reports. Some scam operators have gone into nursing homes and long-term care facilities to collect cash from unsuspecting elders in exchange for swab collections and phony testing, the New York Times reported.

Since the declaration of the public health emergency in the US, the federal Centers for Medicare and Medicaid Services (CMS) no longer requires a lab test requisition signed by a treating physician or other provider for COVID-19 testing. “The strong demand for and limited supply of SARS-CoV-2 tests, along with the move by CMS to relax rules for certain test orders during the pandemic, makes the situation a potentially ripe one for fraud,” Modern Healthcare stated.

Plus, a lack of clarity about the medical necessity of COVID-19 tests could raise the liability risk for law-abiding clinical laboratories. All of these factors make COVID-19 testing fraud a potential bombshell for clinical laboratories conducting coronavirus testing that may get caught up in federal investigations.

Feds Step Up Enforcement

Shortly after the pandemic arrived in the US, the FBI, the Better Business Bureau (BBB), the FDA, the federal Department of Health and Human Services (HHS), and other federal and local authorities have frequently warned doctors, hospitals, and healthcare consumers about the potential for fraud by unscrupulous companies purporting to offer legitimate clinical laboratory testing for COVID-19. A June 26 FBI press release stated, “Scammers are marketing fraudulent and/or unapproved COVID-19 antibody tests, potentially providing false results.”

Some of the fraudsters behind these scams have operated online and through social media and email. While others have conducted these scams in person or over the phone, noted the press release.

And yet, despite the warnings, the scams and news articles about them have continued to spread throughout the COVID-19 pandemic.

Various Forms of Fraud and Their Consequences

In many of these scams, fraudsters seek to collect consumers’ personal information, including names, dates of birth, and Social Security numbers, as well as other forms of personal health information, such as Medicare or private health insurance data, the FBI reported. Scammers can use that information in medical insurance fraud schemes or to commit identity theft, the agency added.

Additionally, any fake or inaccurate COVID-19 tests or assays that the FDA has not allowed for use could provide doctors with false results, potentially creating a dangerous situation for patients.

The New York Times (NYT) recently reported that the FBI had issued a warning “about scammers who advertise fraudulent COVID-19 antibody tests as a way to obtain personal information that can be used for identity theft or medical insurance fraud.”

Three days after the FBI issued its warning about the COVID-19 antibody testing scam, the BBB added an alert to its website: “BBB Scam Alert: Want a COVID-19 test? There’s a scam for that.” BBB also provided advice to consumers about how to avoid testing scams.

On June 17, the FDA reported that it issued warning letters to three companies for marketing adulterated and misbranded COVID-19 antibody tests, stated an FDA news release. The agency sent warning letters to:

Jeff Shuren, MD, JD, Director of the FDA’s Center for Devices and Radiological Health
In the FDA’s announcement, Jeff Shuren, MD, JD (above), Director of the FDA’s Center for Devices and Radiological Health, said “When tests are marketed inappropriately, with inaccurate or misleading claims—such as the ability to perform the test completely at home, or that the test is authorized, cleared, or approved when it is not—they put the health of Americans at risk. Such conduct will not be tolerated by the FDA, and we will continue to monitor tests marketed in the US, taking appropriate action as warranted.” (Photo copyright: The Food and Drug Administration.)

Scams Reported Just in April

On April 17, the New York Times reported that a special agent with the HHS OIG noted that impostors seeking Medicare or Medicaid information posed as doctors or laboratory technicians to offer fake tests in nursing homes and assisted living facilities.

Earlier in April, The Texas Tribune reported that the owner of a freestanding emergency room in Laredo, Texas, spent $500,000 to buy 20,000 rapid COVID-19 tests for patients suspected of having COVID-19. Health officials in Laredo planned to establish a drive-through testing site and then administer tests that came from a manufacturer in China to detect active infections. After trying to validate the tests, city health officials found they were unreliable and unusable.

An April 9 report from the news department of the AARP (American Association of Retired Persons) stated that federal officials have found fake coronavirus testing sites in many states, including Alabama, Arizona, Florida, Georgia, Kentucky, New York, and Washington state.

The FBI, according to AARP, investigated several fake test sites in Louisville, Ky., after a city official reported that people in personal protective equipment (PPE) were collecting biological specimens from residents. Those seeking tests were told to pay $240 in cash or give their Medicare, Medicaid, or Social Security cards to verify their identity.

Fake drive-up testing sites were reported at gas stations and other locations in Louisville over a four-day period, the AARP reported.

On April 2, WRGB TV in Albany, N.Y., reported that scammers pretending to be from the New York State Department of Health (NYSDOH) were taking money and insurance information from people in exchange for fake coronavirus tests. One woman told police she got a fake test at a drive-up site in a Little League parking lot.

North Greenbush police said the scammers identified themselves as being with NYSDOH and collected money and insurance information from multiple people. Police and state officials said the DOH had no connection to the collection site in the parking lot.

Lessons for Lab Directors

For clinical laboratory directors and all clinical lab scientists, the lesson from these stories is to be wary of strangers offering COVID-19 testing, while also making certain to post information for customers about the legitimacy of your lab’s COVID-19 rapid molecular and serological tests. Doing so might involve providing proof that the FDA has allowed your tests to be used for the coronavirus.

Also, medical laboratories should ensure that all employees collecting specimens in public places display proper identification.

—Joseph Burns

Related Information:

HHS Takes Aim at COVID-19 Testing Fraud

FBI Warns of Potential Fraud in Antibody Testing for COVID-19

FBI Warns of Fraudulent Coronavirus Antibody Tests

BBB Scam Alert: Want a COVID-19 Test? There’s a Scam for That

FDA Issues Warning Letters to Companies Inappropriately Marketing Antibody Tests, Potentially Placing Public Health at Risk

FDA Updates List of Fake COVID Tests, Vaccines, and Treatments

COVID-19 Drive-Thru Test Site Shut Down

Homeland Security in Michigan Now Investigating Coronavirus Fraud

LA Sues California Company, Alleging ‘Sophisticated’ COVID-19 Fraud

Reports of Fake Test Sites for COVID-19 Emerge Across U.S.

A Laredo ER Spent $500,000 on Coronavirus Tests. Health Officials Say They’re Unreliable

Scammers in North Greenbush Perform Fake COVID-19 Test, Steal Money, Insurance Details

UnitedHealth Group Says 50% of Seniors Will Enroll In Medicare Advantage Plans within 10 Years; Clinical Laboratories Soon May Have Less Fee-For-Service Patients

Clinical laboratories will want to develop value-based lab testing services as the nation’s largest health insurers prepare to engage with Medicare Advantage patients in record numbers

UnitedHealth Group (UNH), the nation’s largest health insurer, forecasts wildly impressive growth of Medicare Advantage plans and value-based care. If this happens, it would further shrink the proportion of fee-for-service payments to providers, including medical laboratories.

Changes to how clinical laboratories and anatomic pathology groups in America get paid have been the subject of many Dark Daily briefings—such as, “Attention Anatomic Pathologists: Do You Know Medicare Is Prepared to Change How You Are Paid, Beginning on January 1, 2017?” August 22, 2016—and many others since then.

Switching to a value-based care reimbursement system, administered through Medicare Quality Payment Programs (QPPs), is one of the more disruptive changes to hit physicians, including pathologists. And, given UnitedHealthcare’s predictions, healthcare system adoption of QPPs will likely accelerate and continue to impact clinical laboratory revenue.


“Within 10 years, we expect half of all Americans will be receiving their healthcare from physicians operating in highly evolved and coordinated value-based care designs,” stated David Wichmann, CEO, UnitedHealth Group (NYSE:UNH), during the company’s second-quarter earnings call in April. (Photo copyright: Minneapolis/St. Paul Business Journal.)

50% of All Americans in Value-based Care Systems by 2028

UnitedHealth Group also envisions more than 50% of seniors enrolled in Medicare Advantage plans within five to 10 years, up by 33% over current enrollments, Healthcare Finance reported.

“Where it can go, hard to tell, but I don’t think it’s unreasonable to think about something north of 40% and approaching 50%. It doesn’t seem like an unreasonable idea,” said Steve Nelson, CEO, UnitedHealthcare, a division of UnitedHealth Group, during the earnings call.

In light of UNH’s widely-publicized comments, clinical labs should consider:

  • Preparing strategies to reduce dependence on fee-for-service payments;
  • Developing diagnostic services that add value in value-based reimbursement arrangements.

For labs, more seniors in Medicare Advantage plans means fewer patients with Medicare Part B benefits, which cover tests in a fee-for-service style. In contrast, Medicare Advantage plans are marketed to seniors by companies that contract with Medicare. These insurance companies typically restrict their provider network to favor clinical laboratories that offer them the best value.

Why Insurers Like Medicare Advantage Plans

UnitedHealth Group is not the only insurer anticipating big changes in the Medicare Advantage market. Humana (NYSE:HUM) of Louisville, Ky., is reallocating some services from Affordable Care Act health insurance exchange plans to the Medicare Advantage side of the business, Healthcare Dive reported.

According to a Kaiser Family Foundation (KFF) report, these insurers are ranked by number of enrollees in Medicare Advantage plans:

  • UnitedHealthcare—24%;
  • Humana—17%;
  • Blue Cross Blue Shield affiliates—13%.

Healthcare Dive noted that, in a volatile healthcare industry, payers seem to prefer the stability and following benefits of Medicare Advantage plans:

  • Market potential, as evidenced by growing elderly population;
  • Good retention rate of Medicare Advantage customers; and
  • Favorable payments by the Centers for Medicare and Medicaid Services (CMS) to the insurers.

Cleveland Clinic Makes Deals with Humana, Blue Cross Blue Shield

Last year, Cleveland Clinic and Humana announced creation of two Medicare Advantage health plans with no monthly premiums or charges for patients to see primary care doctors, and no need for referrals to in-network specialists, according to a joint Humana-Cleveland Clinic news release.

And, along with Anthem Blue Cross and Blue Shield in Ohio, Cleveland Clinic also launched Anthem MediBlue Prime Select, a Medicare Advantage HMO plan with no monthly premium, a news release announced. For most of their care needs, members access Cleveland Clinic hospitals and physicians.

Control Costs as Medicare Advantage Plans Grows

These examples highlight the necessity for clinical laboratories to prepare as the Medicare Advantage program expands and accompanying networks narrow.

“Medicare Advantage plans will result in more pressure on providers [such as clinical laboratories] and hospitals to focus on the cost of care,” said Michael Abrams, Managing Partner at Numerof and Associates, told Healthcare Dive.

With an exploding elderly population, medical laboratories should analyze what the shift to value-based care and Medicare Advantage plans may mean for their revenues.

—Donna Marie Pocius

Related Information:

UnitedHealth Group’s David Wichmann on Quarter1 2018 Results, Earnings Call Transcript

UnitedHealth Group Grows First Quarter Profits Driven by Medicare Advantage

Medicare Advantage Will Have More Enrollment, Lower Premiums in 2018

Payers are Flocking to the Medicare Advantage Market

Medicare Advantage 2017 Spotlight on Enrollment Market Update Issue Brief

Medicare Advantage Benefits

UnitedHealth Group Predicts 50% of Seniors Will Choose Medicare Advantage

Medicare Advantage Plans Keep Growing

Cleveland Clinic and Humana Create Two New Zero Premium Medicare Advantage Plans

Anthem Blue Cross Blue Shield Ohio Collaborate to Deliver Integrated Care

Attention Anatomic Pathologists: Do You Know Medicare Is Prepared to Change How You Are Paid, Beginning on January 1, 2017?

Expected Increase in Demand for Remote Health Monitoring of America’s Elderly Presents Opportunities for Clinical Laboratories to Provide Services

As our population continues to age, the demand increases for more clinical services and medical laboratory tests that cater to the growing needs of senior citizens

Elderly patients represent the fastest growing healthcare demographic in America. Thus, it is no surprise that healthcare professional in the field of Elderly Care are interested in technologies that enable them to remotely monitor the senior citizens under their care.

Telehealth devices, for example, that monitor a patient’s condition and transmits reports/alerts to primary care doctors and clinical laboratories when biomarkers deviate from set parameters, are becoming frontline tools for ambulatory and home-health practices.

Even emergency departments (EDs) are adopting remote-healthcare, as Dark Daily reported in “Community Paramedicine Brings Emergency Care into Patients’ Homes, Could Increase Clinical Laboratory Specimens Collected in These Settings.”

Healthcare and the Aging Consumer

According to the American Association of Retired Persons (AARP), there are more than 108 million people in the United States over the age of 50. This figure includes over 76 million baby boomers, those born between 1946 and 1964. The number of people over the age of 50 is expected to grow by 19 million over the next decade.

At the latest Aging 2.0 OPTIMIZE conference in San Francisco, Jaana Remes, PhD, economist and partner at the McKinsey Global Institute stated, “In healthcare, there is a clear shift in consumption, and its mainly from a consumer we don’t hear a lot about: the aging consumer. There are a lot of attitudes of stereotypes, and they are still less well known,” noted a MobiHealthNews article. “There is more equality, more diversity, they are more likely to be working later, more likely to be single, they are the most educated older generation yet, and they are much more likely to be tech savvy.”  

Remes added it is important that new technology—such as apps, remote-monitoring systems, and platforms for care teams—are designed with the understanding that seniors will use them. “We need to make things that are suitable, particularly for the 75 and older crowd, to customize their needs,” she stated. “Fewer younger people are taking care of their parents.”

Elderly Care is Four-Five Times More Costly

A report by the National Center for Biotechnology Information (NCBI) states that healthcare costs rise exponentially after a person reaches age 50. According to the report, annual healthcare costs for the elderly are four to five times higher than individuals in their teens.

“Life expectancy has changed dramatically in the US, but while people are living longer, they aren’t necessarily living healthier,” stated Bruce Chernof, MD, President and CEO, The SCAN Foundation, in the MobiHealthNews article. “Maybe they are living with higher function and longer, but they are living with more chronic diseases. Where could tech play a role?” The SCAN Foundation is an independent public charity dedicated to improving care for older adults.

Critical Need for Home Health Monitoring Tools

As America’s population ages, the demand for home healthcare services is escalating at significant rates. According to a report from Zion Market Research, the global market for home healthcare services was valued at $229 billion in 2015. The report also states that that number should reach $391 billion by 2021.

Because families are becoming smaller, and a higher percentage of older adults are single than in the past, there is a greater need for caregivers who provide in-home care. Approximately two thirds of persons receiving home healthcare obtain that care from unpaid relatives and friends.

“The need for technology-enabled caregivers and care support goes up,” noted Chernof in the MobiHealthNews article. “So, we have to look mainly at ‘what is the problem I am trying to solve?’”

Fujitsu Laboratories Limited and Fujitsu Ireland Ltd. ran the KIDUKU Project from 2013-2016. The research initiative was designed to “provide monitoring services and assisted independent living for senior citizens and patients who live in smart houses.” (Graphic copyright: Fujitsu Laboratories Limited.)

Since the largest group of healthcare consumers are seniors, it is crucial to create tools that improve their quality of life and the effectiveness of the healthcare they receive. These tools include monitoring services for both healthcare and home care providers.

“On the pure technology side, it’s simple things like a dashboard report that family members can access that indicate what sensors at home they can interact with, enabling them to track patterns at home, so we can have the family get together and talk, rather than having to bring someone in every few weeks or months and try to figure out the problem moving backwards,” stated Lily Sarafan in the MobiHealthNews article. Sarafan is President and CEO of Home Care Assistance in San Francisco.

According to Sarafan, a significant part of senior care and monitoring is creating technology that tracks patient health and includes a personalized approach to care.

“Collecting better data that we can share with our 10,000 referral partners around the country on what’s happening in that white space, what happens in between when someone sees their healthcare provider two or three times per year because of an emergency or a check-up, and now we’re potentially interacting with a patient 24/7 for months or even years,” she stated. “That’s what puts us in the best possible situation to share data across players in the ecosystem and prevent preventable hospital admissions.”

Clinical Laboratories Could Provide Services; Earn Revenue

It might seem like science fiction now, but there may come a day soon when chronic disease sufferers can opt to have sensors implanted that monitor their conditions 24/7 and collect data that gets transmitted automatically to primary care doctors and other healthcare professionals.

When that happens, some innovative medical laboratories will likely develop business models for monitoring remote devices and collecting revenue for providing the service. By combining the collected data from those devices with a patient’s lab test data, they could identify for medical professionals when interventions are needed for certain conditions.

—JP Schlingman

Related Information:

What the Senior and Aging Care Industry Wants from Digital Health Innovators

A Snapshot of Global Innovation in Aging and Senior Care

How to Help Your Elderly Patients Adapt to Healthcare Technology

Community Paramedicine Brings Emergency Care into Patients’ Homes, Could Increase Clinical Laboratory Specimens Collected in These Settings

From Micro-hospitals to Mobile ERs: New Models of Healthcare Create Challenges and Opportunities for Pathologists and Medical Laboratories

Leapfrog Group CEO Wants Healthcare Professionals to Stop Rallying Behind Quality Measure Critics

Binder argues that groups opposing ‘value’ often diminish clinicians’ role in hospital quality and patient outcomes; clinical labs often have the data on the outcomes generated by different clinicians

As healthcare moves steadily toward a value-based reimbursement model, Leapfrog Group CEO Leah Binder is urging healthcare providers to rethink their opposition to quality measures and criteria that reward improved medical outcomes.

“Clinicians have a choice: Seize the momentum of the value movement to finally get rewarded for excellence, or recite tired political talking points that minimize your life’s work,” Binder stated in an editorial she penned for Modern Healthcare. “Value will succeed either way, but it will be so much better infused with the knowledge and gifts of practicing providers.”

Many clinical laboratory managers and pathologists know that the Leapfrog Group carries quite a bit of clout in healthcare. Its members include some of the largest corporations in the United States. Collectively, Leapfrog’s members provide health benefits to more than 37 million Americans in all 50 states, and spend tens of billions of dollars on healthcare each year, according to this 2009 Leapfrog Group Fact Sheet. This is why health insurers, hospitals, and physicians pay attention to Leapfrog’s programs and public statements.

“If all hospitals implemented just the first three of Leapfrog’s four ‘leaps’ (our recommended quality and safety practices): over 57,000 lives could be saved, more than 3 million medication errors could be avoided, and up to $12.0 billion could be saved each year,” states the fact sheet.

Physician Opposition to Value-based Reimbursement Models Will Backfire

Leapfrog’s Binder argues the value-based reimbursement movement will succeed for three reasons:

1. “Value” is enshrined in the Affordable Care Act, with the Centers for Medicare and Medicaid Services (CMS) now tying almost 6% of hospital Medicare reimbursement to performance, and Congress replacing the sustainable growth-rate (SGR) with a value-based formula.

2. Private insurers also are transitioning their payment models, with 40% of commercial payments linked to value, up from 9% a year earlier. In addition, consumers, who are paying more out of pocket, are increasingly sensitive to value.

3. Big data is enabling quality to be quantified. Binder pointed to the leadership of the National Quality Forum (NQF) and others in showing “we can defensibly measure the quality side of the value equation.”

Binder warns that arguments made in the name of clinicians to denounce specific quality measures can backfire. In particular, she pointed to a study published in the BMJ that concluded clinicians have little impact on the “standardized mortality ratio,” therefore they should not be held accountable for it.

“Here’s the damaging assumption in the study: The only way physicians or nurses improve patient survival is by avoiding killer mistakes. Surely clinical skill impacts mortality more than that,” Binder stated in her Modern Healthcare editorial.

Similarly, Binder pointed to a study published in the Journal of the American Medical Association (JAMA) that also minimized the impact of clinicians. The study compared how United States hospitals scored on CMS composite safety measures versus alternative measures the researchers invented based on process quality composites. She summarized the findings as stating, “Some hospitals excel on the invented quality composites but fail on the CMS safety composite. Illogically, the researchers conclude that the CMS safety composite is flawed. One might just as well conclude that the researchers’ composites are flawed.”

“Ultimately, this paints a dismal portrait of individual clinicians. … If you excel on some but not all measures, the measures are wrong and you don’t excel at anything,” she stated.

Leapfrog Group CEO Leah Binder is urging healthcare professionals to embrace the move toward value-based reimbursement and rethink their opposition to quality measures that reward high-quality patient care. “Clinicians have a choice: Seize the momentum of the value movement to finally get rewarded for excellence, or recite tired political talking points that minimize your life’s work,” Binder says. (Photo copyright: Aaron Eckels/Crain’s Detroit Business.)

Leapfrog Group CEO Leah Binder is urging healthcare professionals to embrace the move toward value-based reimbursement and rethink their opposition to quality measures that reward high-quality patient care. “Clinicians have a choice: Seize the momentum of the value movement to finally get rewarded for excellence, or recite tired political talking points that minimize your life’s work,” Binder says. (Photo copyright: Aaron Eckels/Crain’s Detroit Business.)

Leapfrog Group Advocates Transparency for Both Insurers and Patients

The Leapfrog Group was formed in 2000, a year after the Institute of Medicine’s (IOM’s) landmark report on medical errors, “To Err Is Human: Building a Safer Health System,” in which the IOM estimated that preventable medical errors caused 44,000 to 98,000 deaths annually, with an associated cost of $17 billion to $29 billion.

The watchdog organization operates out of Washington, D.C. and is made up of more than 170 of the nation’s largest purchasers of healthcare, including:



Lockheed Martin;

Marriot International;

University of Michigan; and

• the Florida Healthcare Coalition.

Through its annual hospital surveys and research, the non-profit urges insurers and patients to use transparency to improve the safety and quality of the healthcare system.

The Leapfrog Group’s movement for transparency has grown to include more than 1,700 hospitals that participate in its annual survey on safety, quality, and resource use. In 2015, a record 1,750 hospitals submitted a survey, representing 46% of hospitals nationwide. It also has focused attention on reducing early elective deliveries, launched a pay-for-performance program, and designed a Hospital Safety Score to help consumers to make better healthcare decision.

Providers Should Seek Transparency

While negotiations about quality measures have reached a fever pitch, Binder would like to see providers insist on transparency and accountability for their patients, a step she says would validate clinicians’ work and expertise.

“While thoughtful critiques of measures are important, politically-motivated denial of measures is destructive in unintended ways,” Binder stated in her editorial for Modern Healthcare. “It often follows the unfortunate pattern of these studies in assuming that providers perform at essentially the same level of quality and/or their actions can’t be linked to patient survival or healing,” she observed.

“If all physicians and nurses believed their work had such modest impact, the burnout problem might be even worse,” continued Binder. “People who choose a career in healthcare tend to be bright, competitive and caring, and they won’t last long if they believe their talents make virtually no difference.”

As noted above, since the Leapfrog Group represents many of the major purchasers of healthcare, Binder’s recent comments should grab the attention of pathologists and clinical laboratory executives. They would do well to anticipate continued calls for more quality and more measurement of quality in healthcare as the movement toward value-based reimbursement marches on. Contributing value to hospitals, physicians, and payers is quickly becoming the new paradigm for clinical laboratories and pathology groups.

—Andrea Downing Peck

Related Information:

Clinicians Must Push Back Against Critics Challenging the Role of Quality Measures

Standardized Mortality Ratios Should Not Be Used to Benchmark Hospitals, Study Concludes

Leapfrog Group Fact Sheet

Concerns About Using the Patient Safety Indicator-90 Composite in Pay-for-Performance Programs

To Err Is Human: Building a Better Health System