MHA FPX 5014 Assessment 3 Cost-Benefit Analysis for Transitional Management Care

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Capella University

MHA-FPX 5014 Health Care Quality, Risk, and Regulatory Compliance

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Date

Abstract

Transitional Care Management (TCM) entails facilitating a patient’s transition from hospital discharge to community-based care. This study conducts a Cost-Benefit Analysis (CBA) to assess the financial implications of the TCM program, focusing on its benefit-to-risk ratio. TCM in hospital settings aims at reducing patient readmissions, enhancing post-hospital care quality, ensuring care continuity, and fostering long-term patient well-being (Elsener et al., 2023). The CBA aids in understanding the cost-effectiveness of TCM by projecting its expenses over five years and comparing them with anticipated benefits, facilitating informed decision-making (Elsener et al., 2023).

Keywords: Transitional Care Management, Cost-Benefit Analysis, Continuity of Care, Readmissions, Centers for Medicare and Medicaid Services

Focus of Stakeholders for a Cost-Benefit Analysis

Identification of stakeholders involved in TCM within a hospital setting is paramount. Primary stakeholders encompass patients, caregivers, and the hospital discharging the patient. External stakeholders include pharmacists, transitional care center management, payors, and community service agencies. The objective for the hospital and stakeholders is to evaluate how TCM implementation benefits discharged patients and reduces readmissions vis-à-vis program costs over five years.

Patients under TCM receive support from designated caregivers or facilities to ensure seamless care and continuity of treatment. External medical professionals oversee patients in the community, bridging the gap between inpatient and outpatient services. Moreover, hospitals adopting TCM stand to gain financially through incentives like the Centers for Medicare and Medicaid Services (CMS) Hospital Readmission Reduction Program (HRRP), which rewards hospitals for reducing readmissions within 30 days of discharge (CMS, 2021).

Value Proposition for Change Management

Introducing change in healthcare organizations poses challenges requiring systematic strategies for smooth transitions. Change management is crucial for TCM implementation, being a novel concept for healthcare entities, providers, patients, and staff. Effective change management entails administrative, financial, provider support, and team collaboration to ensure a seamless transition for all stakeholders.

Through community partnerships, change management in TCM emphasizes the program’s advantages (Nathan et al., 2021). Well-managed change initiatives enhance patient care quality and satisfaction during hospital stays and post-discharge for both short-term and long-term care. Failure to employ change management can lead to prolonged transition times, increased long-term patient care costs, and suboptimal care, resulting in higher readmission rates. Mitigating risks include reduced mortality and infection rates, fewer emergency room visits, and decreased readmissions. Furthermore, TCM can cut costs by reducing readmissions and improving financial incentives under the CMS HRRP program (Nathan et al., 2021).

Strategies to Influence and Impact Changes for Quality Improvement

Research underscores that poor communication and coordination significantly contribute to preventable hospital admissions and readmissions. Hospitals lacking TCM models often experience elevated readmission rates, mortality rates, infection rates, and long-term illnesses due to inadequate patient coordination post-discharge. Absence of TCM also signifies deficient patient education, self-care, family involvement, and communication with external caregivers (Racheal & Shen, 2023).

TCM success necessitates robust leadership and support. Active leaders provide oversight and direction, ensuring strategic momentum and accountability during TCM implementation. Key quality improvement strategies under the TCM model include comprehensive internal and external communication and coordination spearheaded by strong leadership. Timely follow-up care within 14 days of discharge is critical to ensure optimal patient outcomes. Additionally, fostering a culture of safety and continuous improvement is indispensable when implementing TCM (Hughes, 2008).

Cost-Benefit Analysis and Assumptions

A CBA is imperative to project the costs associated with TCM program implementation. Predicting the Return on Investment (ROI) for a service-based care model like TCM can be challenging. Research underscores the immediate benefits and potential cost savings of TCM, such as reduced readmissions within 30 days of discharge, heightened patient satisfaction, improved communication, and enhanced care continuity.

The initial-year cost of implementing TCM is estimated at $774,688, covering aspects like leasing clinical space, staffing Certified Family Nurse Practitioners (CFNPs), and acquiring necessary equipment. Over five years, the total projected cost amounts to $4,613,707.92. Conversely, the one-year revenue from the TCM program is estimated at $5,086,144.40, with a five-year valuation of $5,083,156.44. Thus, the total projected profit over five years stands at $29,051,622.13 (Pedrosa et al., 2022).

Internal and External Benchmarks

Benchmarking is pivotal in healthcare to analyze income and costs and streamline inefficiencies. It involves implementing best practices at the lowest costs from a systems-based perspective (SBP). Continuous quality improvement (CQI) necessitates measuring quality indicators, performance, and collaboration. Benchmarking in TCM entails comparing data to reduce 30-day hospital readmissions.

CMS’s TCM initiative aims to bolster patient safety, improve outcomes, and curtail unnecessary costs. The TCM program enables hospitals to document post-acute conditions within 30 days of discharge and monitor patient satisfaction. TCM implementation lowers penalties by 50%, thereby augmenting hospital revenue. Enhanced benchmarks encompass superior patient quality measures, decreased hospital-acquired conditions (HACs) and infections (HAIs), and incentivized value-based care (Marques et al., 2023).

Conclusion

Recent studies reveal that one in five Medicare patients is readmitted to the hospital within 30 days of discharge, incurring nearly $26 billion annually. Adopting a TCM program enhances public relations and necessitates buy-in from stakeholders both internally and externally. Collaboration between internal staff and external caregivers ensures enhanced patient safety, satisfaction, and outcomes beyond the 30-day mark.

References

AAPC. (2022). CPT® code 99496 – Transitional Care Evaluation and Management Services – codify by AAPC. Retrieved April 12, 2022, from https://www.aapc.com/codes/cpt-codes/99496

MHA FPX 5014 Assessment 3 Cost-Benefit Analysis for Transitional Management Care

CMS.gov. (2021, July). Transitional Care Management Services. CMS.gov Medicare Learning Network. Retrieved February 18, 2022, from https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/Transitional-Care-Management-Services-Fact-Sheet-ICN908628.pdf

Elsener, M., Santana Felipes, R., Sege, J., Harmon, P., & Jafri, F. N. (2023). Telehealth-based transitional care management programme to improve access to care. BMJ Open Quality, 12(4). https://doi.org/10.1136/bmjoq-2023-002495

Hughes, R.G. (2008). Tools and Strategies for Quality Improvement and Patient Safety. In R.G. Hughes (Ed.), Patient Safety and Quality: An Evidence-Based Handbook for Nurses. Agency for Healthcare Research and Quality (US). Retrieved from https://www.ncbi.nlm.nih.gov/books/NBK2682/

MHA FPX 5014 Assessment 3 Cost-Benefit Analysis for Transitional Management Care

Jessica, R., Racheal, E., & Shen, W. (2023). Building a Financially Sustainable Transitional Care Management Workflow. Family Practice Management, 30(1), 18. Retrieved from http://library.capella.edu/login?qurl=https%