Avalere Health
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Insights Article

Three Strategies to Reduce PAC Spending

| May 31, 2013

Nowhere are there more opportunities for savings than in post-acute care (PAC) settings.

Per capita service use ranges from $60 to $450 for PAC, compared to $225 to $425 for ambulatory care and $250 to $400 for acute inpatient care. These differences mean that PAC providers have many opportunities to drive greater efficiencies, a fact not lost on the Medicare program.

Avalere best practices analysis identifies three opportunities to reduce PAC spending:

  • Hospitals should discharge patients to the lowest cost setting that has demonstrated high quality services and effective outcomes. Spending across an episode of care for the same MS-DRG varies significantly based on the first site of discharge. 
  • Institutional setting length of stays should be as short as possible.  Significant savings opportunities arise when patients discharged to institutional settings have been transitioned home quickly and safely.
  • Providers managing risk should reduce unnecessary readmissions.  The average national 30-day re-hospitalization rate from SNFs in 2011 was 20 percent (Avalere Vantage Care Positioning Systemâ„¢ report)
Avalere is the essential voice improving healthcare. We stay ahead of the curve and generate deep content for clients across the entire healthcare industry. We look forward to partnering with you to make better business decisions. For more information, please contact Anne Tumlinson.
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