A subacute network for nursing homes.

Several New Jersey nursing homes have done what many say nursing homes should do they've formed a managed care network

Readers of Nursing Homes have heard this before: the Lone Ranger is gone. The freestanding nursing facility that tries to go it alone in the fast-approaching managed care wilderness will end up with a "hide full of arrows" and not much else. Facilities have to band together, with each other and with other levels of care, to survive the financial rigors of the managed care era.

Easier said than done? A group of 16 New Jersey nursing facilities has done just that; they've formed a state-wide network offering an array of post-acute care services to interested managed care organizations. Of the 2,000-some skilled beds they represent in toto, more than 600 are dedicated to post-acute care. Managed care now represents approximately 20% of their business. And, to add to their "continuum of care" appeal, they're venturing into home care as well.

Basically the brainchild of a small nursing home chain called Long Term Care Management, the New Jersey Postacute Network (NJPAN) is intended to give the nursing homes "more mass" in the managed care marketplace, according to president Herb Heflich. As the network is structured, whatever level of post-acute service the "customer" wants - and the network offers six - should be readily available and accessible.

To bring this off, the nursing homes had to form their own corporation, with each purchasing shares of stock, and each occupying a seat of the board of directors, which meets every couple of months to review and set policy. But it goes beyond that. Each member nursing home must indeed be prepared to deliver bona fide post-acute care, not long-term care with a post-acute label. NJPAN's entry requirements are therefore strict. Each facility must offer round-the-clock admissions; four hours of nursing care seven days/week; have a nursing mix of 35% RNs, 25% LPNs and 40% aides; offer general medical services two to three days/week and physiatry one to two visits/week; provide dedicated space and equipment; employ a dedicated nurse manager and on-site nurse case managers; document outcomes; and have not only Medicare certification, but accreditation by JCAHO.

Needless to say, only a few nursing facilities have been ready to sign on from the get-go, and the NJPAN has made it its business to help bring worthy applicants up-to-speed. "Our staff can spend six to eight months at a facility consulting them on this," notes Paula Stamler, Chief Operating Officer. "We want them to succeed, because then we'll all succeed."

Different facilities offer different services of varying degrees of intensity, i.e. (in descending order), levels 4-6 - complex, intensive medical services, ventilator management and traumatic brain injury care; level 3 - wound care, pain management, IV therapies; level 2 - rehabilitation; and level 1 - skilled nursing. NJPAN staff and case managers coordinate to get patients placed in the appropriate facilities, and NJPAN provides "transitional care maps" (otherwise known as critical pathways) to guide providers and case managers within certain diagnoses - cellulitis, CABG, COPD, stroke, wound management and (soon) pain management. This closely controlled approach becomes increasingly crucial, of course, as managed care payment moves from today's typical per diem arrangements to case rates and capitation. Without a hard-and-fast grasp on costs per-case, providers will very likely go under.

In line with this, NJPAN staff also negotiates managed care contracts for the facilities to, as Paula Stamler puts it, "get rates they can live with." Their negotiating position is buttressed by outcome reports based on the format developed by the Chicago-based Formations in Health Care, which combines rehab (FIMS) with medical criteria.

Thus far the network has done most of its business with HMOs and PPOs with Medicare risk contracts, though Stamler notes that there is also commercial third-party business.

NJPAN's next planned venture is into home health care, with the network supporting development of strategically located agencies near member facilities. "It is more efficient, and more resources can be brought to bear, when you have a network planning and supporting this sort of development," says Stamler. The thinking is that direct provision of such services will enhance the Network's appeal to managed care by enriching its post-acute offerings.

The NJPAN approach has sparked interest in other states, Stamler notes - Florida, Maryland and New Hampshire among them - though whether NJPAN will have much direct involvement with this is uncertain. What is certain, says Stamler, is the two-year-old network's sense of having achieved a breakthrough: Can and will nursing homes step into their managed care future together? "We're ahead of the curve on this one."

For more information about NJPAN, contact Paula Stamler at [phone].