3 Reasons Analytics are a Must-Have for Skilled Nursing Facilities

Accurate, relevant, and timely analytic help SNFs stay focused on today with a firm plan for tomorrow

Skilled Nursing Facilities (SNFs) often find themselves facing significant challenges — challenges that have no easy answers. It’s a fundamental fear. If organizations can’t figure out what’s going wrong — and why — they won’t be able to figure out where and how to implement effective changes that can help them survive and be successful. Analytics for skilled nursing facilities can help them excel in three key areas:

• Revenue and reimbursement
• Value-driven outcomes
• Keeping compliance current

#1 To improve revenue and reimbursement

Sustained revenue and reimbursement drive SNF success. Without processes in place to ensure consistent reimbursement rates and steady revenue sources, facilities are at risk. The biggest driver of R&R? Occupancy. It makes sense. More beds filled means more money coming in for SNFs. Tied to occupancy, meanwhile, is the payer mix — where the money is coming from to pay for resident stays.

For example, residents coming directly from hospitals to SNFs that are covered under Medicare or MedicareAdvantage plans yield the highest per-diem payments because they require more intensive care, but they rarely stay for longer than 14 days. Medicaid residents, meanwhile, make up the bulk of SNF revenues but have much lower per diems.As a result, a healthy mix of both is critical to keep revenues steady.

Without effective analytics, however, skilled nursing facilities are flying blind. Effective data collection and analysis make it possible for SNF management to pinpoint current occupancy levels and predict future resident trends, in turn providing a big-picture approach to profitability. Assessment of payer mix movement, meanwhile, can help inform decisions around spending, staffing, and ongoing support.

#2 By prioritizing value-driven outcomes

With SNF quality ratings now easily accessible to residents and their families, companies need to consider the role of value-driven outcomes in ongoing success. Consider the July 2022 Five-Star Ratings, which saw one-third of SNFs experience a drop in their staffing ratings. Using tools like CMS’ Care Compare, anyone can look up the overall “quality” rating of a skilled nursing facility. While the ratings don’t tell the whole story, they often play a large role in the decisions of residents and their families.

Outcomes are also dependent on resident acuity levels and the accurate recording and reporting of resident data. If SNFs find quality ratings falling because they’re unable to take on residents who require skilled care and/or spend a lot of time and money correcting inaccurate data reporting, the results could negatively impact their revenue streams.

This could include:

• A loss of referral business
• Being dropped from preferred provider networks
• Penalties based on value-based payment (VBP) frameworks.

In-depth analysis of outcomes can help SNFs pinpoint and address the root causes of quality issues, rather than simply solving for symptoms.

#3 By keeping compliance current

Compliance impacts all aspects of SNF operations. For example, if a resident falls and breaks their hip and an investigation determines that the facility didn’t do enough to prevent this occurrence, this could lead to a citation that negatively impacts overall quality ratings.Meanwhile, if audits determine that Medicare reimbursement claims are not justified by existing documentation, SNFs could lose revenue or even beheld legally liable.

This means that in day-to-day operations, reimbursement and value-driven outcomes are naturally interconnected by compliance. Regulatory issues in either area can have knock-on effects that could result in both short-term revenue loss and long-term quality impacts. Analytics make it possible to keep compliance current by comparing current care frameworks against industry best practices and flagging potential issues with reimbursement documentation before it’s submitted for approval.