The Association Between Facility Affiliations and Revenue Generation in Skilled Nursing Facilities – An Exploratory Study

Abstract

Background

Although hospitals have been the traditional setting for interventional and rehabilitative care, skilled nursing facilities (SNFs) can offer a high-quality and less costly alternative than hospitals. Unfortunately, the financial health of SNFs is often a matter of concern. To partially address these issues, SNF leaders have increased engagement in a number of affiliations to assist in improving quality and reducing operational costs, including Accountable Care Organizations (ACOs), Health Information Exchanges (HIEs), and participation in Bundled Payment for Care Improvement (BPCI) programs. What is not well understood is what impact these affiliations have on the financial viability of the host organizations. Given these factors, this study aims to identify what association, if any, exists between SNF affiliations and revenue generation.

Methods

Data from calendar year 2022 for n=13,447 SNFs in the US were assessed using multivariate regression analysis. We evaluated two separate dependent measures of revenue generation capacity: net patient revenue per bed and net patient revenue per discharge and considered three unique facility affiliations including (1) ACOs, (2) HIEs, and (3) BPCI participants.

Results

Six multivariable linear regressions revealed that ACO affiliation is negatively associated with revenue generation on both dependent measures, while HIE affiliation and BPCI participation reflected mixed results.

Conclusion

A better understanding of the financial impact of SNFs’ affiliations may prove insightful. By carefully considering the value of each affiliation, and how each is applicable to any given market, policymakers, funding agencies, and facility leaders may be able to better position SNFs for more sustainable financial performance in a challenging economic environment.

Keywords:

• skilled nursing facilities
• accountable care organizations
• health information exchanges
• bundled payment for care improvement
• revenue
• discharges

Ethics Statement

Prior studies of this type have been reviewed by the Texas State University Research Integrity and Compliance (RIC) office. According to the provisions in 45 CFR § 46.102 pertaining to “human subject” research, the RIC has determined that studies of this type exclusively involve the examination of data originally collected from the public domain and curated by Definitive Healthcare is anonymous and publicly available. Therefore, the RIC has concluded research of this type does not use human subjects and is not regulated by the provisions in 45 CFR § 46.102 and therefore an IRB review of the study is not required.

Author Contributions

All authors who contributed to data analysis, drafting, or revising the article, have agreed on the journal to which the article will be submitted, gave final approval of the version to be published, and agreed to be accountable for all aspects of the work.

Disclosure

The authors report no conflicts of interest in this work.

Additional information

Funding

The researchers report no funding sources were used to complete this work.