The "Surgical Home" Solution

Facing Increasing Penalties, ORs Seek a Comprehensive Approach to Quality Improvement

The following content is sponsored by Surgical Directions.

Most hospital surgery departments have taken steps in recent years to boost quality. Unfortunately, their good efforts may not be enough to keep up with rapidly increasing penalties for OR quality shortfalls. Consider the payment changes that will roll out in just a few months:

The VBP program will add new surgical quality measures. The Medicare Hospital Value-Based Purchasing program will add several surgical outcome measures. To maintain CMS revenue, hospital ORs must minimize post-operative blood clots, blood infections, surgical wound rupture and hip fractures. In FY 2014, 1.25 percent of DRG payments to eligible hospitals will be withheld to provide the estimated $963 million necessary for VBP program incentives. More than half of all hospitals within the program will lose some portion of their Medicare reimbursements. VBP withholdings will rise by steps to a maximum 2 percent in 2017.

Medicare HAC penalties will begin. October will also see the launch of Medicare penalties for hospital-acquired conditions such as orthopedic pulmonary embolisms and deep vein thrombosis, surgical site infections and retained objects. ORs in the lowest-quality quartile for these complications will be penalized 1 percent.

Readmissions penalties are ramping up. CMS will add coronary artery bypass graft to the readmission reduction program in just two years. The program is sure to target other surgical procedures in the near future. Penalties will increase to 3 percent in fiscal year 2015.

Costs are coming under increasing pressure. Also in the new fiscal year, the VBP program will begin tracking hospital spending efficiency. Separately, the Medicare bundled payment initiative is rapidly developing a reimbursement model that will penalize hospitals for high costs.

The bottom line is that quality and cost expectations are ramping up faster than most hospital ORs can respond. Traditional approaches to OR quality improvement are no longer adequate in today's rapidly evolving payment environment.

To maintain revenue, hospital ORs must adopt a comprehensive approach to improving surgical quality while minimizing costs. Many organizations have achieved promising results through a new clinical model — the perioperative surgical home. Leading ORs nationwide have used the surgical home model to increase quality, reduce complications, optimize patient outcomes and control the cost of care.

Two stubborn problems
The surgical home concept addresses two problems in surgical care today:

1. Lack of coordination. A single surgical procedure involves dozens of clinicians and support personnel, both inside and outside the hospital. In most organizations, the services provided by these individuals are only loosely coordinated. The results are often miscommunication and waste.

2. Lack of standardization. Surgeons, anesthesiologists, nurses and other clinicians often make practice decisions based on personal experience and individual preference. Differences in perioperative care lead to wide variation in quality and outcomes. In addition, lack of standardization makes it difficult to evaluate current performance and strategize process improvements.

Overall, poorly coordinated and non-standardized surgical care leads to uneven quality, costly inefficiencies, a higher risk of error and mixed patient outcomes. The surgical home is designed to address these underlying problems by providing fully coordinated, evidence-based surgical care.

A comprehensive solution
The surgical home concept was proposed by the American Society of Anesthesiologists in 2012. Under the ASA model, anesthesiologists use their unique expertise to optimize perioperative care. Surgical home initiatives have also been led by surgeons and hospitalists. All versions of the model share a handful of common characteristics.

  • Evidence-based care pathways (standardized services and care plans for specific procedures)
  • Standard protocols for managing specific patient conditions (such as diabetes or anemia)
  • Coordination of services across pre-operative, intraoperative and post-operative care
  • Proactive discharge planning, including rehabilitation and home recovery
  • The use of care coordinators to orchestrate all patient services

What does the model look like in practice? Here's a snapshot one possible approach to a surgical home program for knee replacement:

Pre-operative preparation. From the moment surgery is scheduled, the OR begins capturing and assembling key patient data. The focus is on identifying, managing and minimizing patient risks. Staff use an evidence-based matrix to schedule pre-surgical testing based on the patient's medical conditions and current medications. Patients prepare for surgery and recovery at a "joint camp" education session.  Anesthesia develops an individualized pre-op care plan, including management of chronic conditions, pain management and discharge strategy.

During surgery.  Intraoperative care follows protocols accepted by the surgery and anesthesiology departments. For example, anesthesiologists actively manage patient insulin levels according to evidence-based guidelines. Surgical treatment is based on national guidelines or department protocols.

Post-op care. Clinicians continue to follow the perioperative care plan, including pain management, ambulation and discharge protocols. An anesthesiologist or hospitalist serves as the "perioperative primary care physician" to monitor patient progress, respond early to recovery risks and maintain coordination of care. Case managers and home health nurses follow up with the patient to ensure early intervention for emerging complications and avoid high-cost readmissions.

The comprehensive surgical home approach has enabled many organizations to achieve dramatic improvements in quality, outcomes and costs, including:

Surgical quality gains. After the University of California Irvine Medical Center created a Surgical Home for joint replacement patients, compliance with Surgical Care Improvement Project protocols increased to virtually 100 percent.

Shorter length of stay. The University of Southern California's Keck Medical School tested a surgical home model of care against the conventional approach to patient management. ICU length of stay decreased 44 percent and total hospital length of stay decreased 32 percent.

Better outcomes. Surgical Home care can also help prevent post-op complications. The Keck initiative reduced 30-day mortality by 47 percent.

Lower costs. Standardized care reduces unnecessary testing costs, while evidence-based pathways reduce costs associated with poor outcomes. A Mayo Clinic knee replacement Surgical Home initiative cut the mean cost per episode by $956.

These and other cost control achievements help ORs maintain revenue under shared savings arrangements such as bundled payment contracts or ACOs. In addition, surgical homes create a higher-quality care environment, which can increase surgeon satisfaction and drive volume growth.

How to get started
Developing a surgical home program is complex, but leading ORs have laid a strong foundation. Hospital executives can play a key role by keeping the entire organization focused on three priorities:

Build broad support. The surgical home model requires strong participation from all OR stakeholders. Identify a physician champion for OR quality improvement and partner with him or her to build support for the new care model. The goal is to gain commitment from every point in the perioperative continuum — surgeons, anesthesiologists, nursing, care management, rehabilitation, pharmacy, materials management and other departments.

Pick low-hanging fruit. Most successful surgical homes start by focusing on one or two high-volume, high-cost procedures. Improving care and outcomes for coronary artery bypass grafting or hip replacement, for example, can have a big impact on overall quality performance and costs.

Measure gains. A surgical home will help your OR meet Medicare quality requirements, but maintaining government revenue is just the start. Leading hospitals are leveraging surgical home gains to negotiate favorable contracts with private payers. The key is to establish relevant measures, track performance and demonstrate improvement in clinical and financial outcomes.

While the surgical quality threshold is rising, the opportunities are expanding as well. Building a surgical home program can help your OR meet increasing quality requirements, secure higher payment and become established as a preferred surgical provider in your market.

Jeffry Peters, MBA is president and CEO of Surgical Directions.
Barbara McClenathan, RN, BSN, MBA-HCM CNOR is the senior nurse executive with Surgical Directions.


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