Hospitals Pay for Cutting Costly Readmissions
Millions of patients each year leave the hospital only to return within weeks or months for lack of proper follow-up care. One in five Medicare patients, for example, returns to the hospital within 30 days. Over all, readmissions cost the federal government an estimated $17 billion a year.
But even when hospitals find ways to greatly reduce the return trips, saving money for Medicare and other insurers, their efforts go unrewarded. In fact, because insurers typically pay hospitals to treat patients — not to keep them away by keeping them healthy — hospitals can actually lose money by providing better care. Empty beds mean lost revenue.
As Congress debates health care, some policy experts say no meaningful improvement can be made without changing the payment system so medical centers have more financial incentive to help people stay out of the hospital.
As long as our payment system incentivizes episodic care, we face this paradox. What is good for Medicare is not good for the hospitals, and vice versa.
I highly recommend reading the entire article. We need a system that aligns incentives appropriately, but that achievement will be quite difficult.
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Simple solutions to complex problems are not the answer.
I can come up with multiple examples as to why a blanket “no payment for readmission” is stupid. E.g., urosepsis, successfully treated, 4 weeks later fell at home (a never event, remember) and now readmitted for broken hip. Do you think the ortho boys would be happy to treat for free?
And, as Happy Hospitalist writes in an earlier post, the population is ill. Sick people get sicker. Folks with PPP can recover from one thing to develop another. Noncompliant people still eat loads of salt and then wonder why water retention and SOB is an issue. And some of it is the natural disease course…where hospice referral would be appropriate.
I think this gets to heart of health care reform currently before us. We want to think of health care like any other market commodity, when it is in fact rather different, in many, many ways. People refuse to accept a single payer system based on this assumption – that the free market is superior. It is better when you’re talking about cars and tvs. But for medicine – we have AMPLE evidence that incentives to provide more care for more money – the free market at work – does NOT improve health.
And this is only worsened by the fact that value in the health care market is incredibly opaque, so much so that no patient and few physicians are able to act like Adam Smith’s rational consumer who seeks out the best product for the lowest price.
I’ve come full circle on this issue. I started thinking govt health insurance was the way to go in med school, then I saw the VA in the early 90′s. I started thinking free market was the way to go, then I saw how screwed up health care was in the community. I don’t think health care can work as a free market, none of the assumptions of a free market hold in medicine. (3rd party payment, no price or quality transparency, very little choice, & often no time to weigh choices.) Unfortunately, to fix health care we would need a well managed govt plan & medicare is not it. Maybe lessons can be gained from the progress the VA has made in the last 15 years or how Geisinger, Mayo, or Kaiser run their health care. Maybe a non-profit comprehensive system is the way to go. It would be great to have comparisons of how patients fare when they are not part of system vs. how they do in the VA, Geisinger, Mayo, etc.
You are *my patient.* You are *nobody’s consumer.* That is, “patient” presupposes a relationship defined by a culture over a specific history. “Consumer”, like Christian said, presupposes choices made for the moment to fulfill goals defined only by that consumer. (A “customer” is akin to a “patient.”) “Patients” get sick, live, or die, always within the culture of Medicine; that culture has ethical, legal, personal and even mythic dimensions. “Consumers” don’t get “sick”: they purchase commodities.
Not to be tedious, but once you’re my patient, you’re always my patient (even if I no longer have the responsibility). Don’t you remember your first REAL patient back when you were an M3? And will remember forever? It’s more like being a lover. But once you’re my consumer, why should I give a damn? I’ll stop before closing the love-metaphor.
If the citizens of a country are our patients, then let US – physicians, nurses, hospital administrators, ward clerks and janitors – together with THEM – the folks who are sick – figure out how to solve the mismatch of dollars/time/quality-of-life problem. We do it every day in an apolitical, yet nonetheless binding, fashion in office and hospital room and NH. It is a different economics, an existential calculus: no MBA class for it, no supply/demand curves. But if those citizens are consumers, then they – and their appointed agents – are claiming that a mathematical model of our interaction can capture all that is important. And in that case, let EVERYBODY make the decision best for her. I sell EMGs, you sell lap-chole’s, the consumer and her attorney just walk up and down the aisles with a shopping cart. You don’t buy love; you just think you do. And everybody does.
This NY Times article quite confuses the issue. Unless, of course, there really is no issue. I.e., the author says that re-admits are easily avoidable, when what he, and others, really mean is that PAYING for re-admits is easily avoidable. After all, shouldn’t the hospitals (why do they never say “those doctors”?) be responsible for the victimized consumers? Hospitals don’t teach, don’t communicate, don’t care. Right?
“What we’ve got here is a failure to communicate.” Oh, don’t we, Luke.
What follows are believed to be facts that are believed to exist regarding the present U.S. Health Care System. This may be why about 80 percent of U.S. citizens understandably want our health care system overhauled desperately due to the inadequate health care they receive and access:
The U.S. is ranked rather low related to life expectancy and infant mortality.
However, the U.S. is ranked number one in the world for spending the most for health care- as well as being number one for those with chronic diseases.
About 125 million people have such diseases. This is about 70 percent of the Medicare budget that is spent treating these terrible illnesses.
Health Care costs are now well over 2 trillion dollars of our gross domestic product. This is three times the amount nearly 20 years ago- and 8 times the amount it was about 30 years ago.
Most is spent with medical institutions, as far as health expenditures are concerned.
About a third of that amount is nothing more than administrative toxic waste that does not involve the restoration of the health of others. This illustrates how absurd the U.S. Health Care System is presently.
Nearly 7000 dollars is spent on every citizen for health care every year, and that, too, is more than anyone else in the world.
We have around 50 million citizens without any health insurance, which may cause about 20 thousand deaths per year.
This includes millions of children without health care, which is added to the planned or implemented cuts in the government SCHIP program for children, which alone covers about 7 million kids.
Our children.
Nearly half of the states in the U.S. are planning on or have made cuts to Medicaid, which covers about 60 million people, and those on Medicaid are in need of this coverage is largely due to unemployment.
With these Medicaid cuts, over a million people will lose their health care coverage and benefits to a damaging degree.
About 70 percent of citizens have some form of health insurance, and the premiums for their insurance have increased nearly 90 percent in the past 8 years.
About 45 percent of health care is provided by our government- which is predicted to experience a severe financial crisis in the near future with some government health care programs, it has been reported.
About half of all patients do not receive proper treatment to restore their health, it has been stated. Medical errors desperately need to be reduced as well.
Most doctors want a single payer health care system, which would save about 400 billion dollars a year- about 20 percent less than what we are paying now.
The American College of Physicians, second in size only to the American Medical Association, supports a single payer health care system.
The AMA, historically opposed to a single payer health care system, has close to half of its members in favor of this system.
Less than a third of all physicians are members of the AMA, according to others.
Our health care we offer citizens is the present system is sort of a hybrid of a national and private health care system that has obviously mutated to a degree that is incapable of being fully functional due to perhaps copious amounts and levels of individual and legal entities.
Health Care must be the priority immediately by the new administration and congress.
Challenges include the 700 billion dollars that have been pledged with the financial bailout that will occur, since the proposed health care plan of the next administration is projected to cost over a trillion dollars within the first year or so of the proposed plan to recalibrate health care for all of us in the U.S.
Likely, hundreds of billions of dollars that are speculated to be saved with a reform of the country’s health care system.
Health policy analysts should not be greatly concerned on the health care corporate shareholders who may be affected by this reform of our health care system that is desperately needed.
It is estimated that the U.S. needs presently tens of thousands more primary care physicians to fully satisfy the necessities of those members of the public health.
This specialty makes possibly less than 100 thousand dollars annually in income, compared with other physician specialties, yet they are and have been the backbone of the U.S. health care system.
The American College of Physicians believes that a patient centered national health care workforce policy is needed to address these issues that would ideally restructure the payment policies that exist presently with primary care physicians.
Further vexing is that it is quite apparent that we have some greedy health care corporations that take advantage of our health care system.
Over a billion dollars was recovered for Medicare and Medicaid fraud last year through settlements paid to the department of Justice because some organizations who deliberately ripped off taxpayers.
These are the taxpayers in the U.S. who have a fragmented health care system with substantial components and different levels of government- composed of several legal entities and individuals, which has resulted in medical anarchy, so it seems.
Thanks to various corporations infecting our Health Care System in the United States, the following variables sum up this system as it exists today.
Perhaps the United States National Health Insurance Act (H.R. 676) is the best solution to meet our health care needs as citizens, it appears.
We would finally have, as with most other countries, a Universal Health Care system that will allow free choice of doctors and hospitals, potentially, and health care for all completely.
It should and likely will be funded by a combination of payroll taxes and general tax revenue which is realistically possible.
Because the following seems to be in need of repair regarding the U.S. Health Care System:
Access- citizens do not have the right or ability to make use of this system as we should.
Efficiency- this system strives on creating much waste and expense as it possibly can.
Quality- the standard of excellence we deserve as citizens with our health care is missing in action.
Sustainability- We as citizens cannot continue to keep our health care system in as it is designed at this time- as it exists today.
http://www.mckinsey.com/mgi/publications/US_healthcare/index.asp
Dan Abshear
Single payer would be great
Currently I practice in a system where dozens of insurance companies duplicate the same services for fees that are within $5 of each other.
Regular Medicare is becoming the gold standard for insurance. It is one of two plans that does not require preauthorizations for CTs/MRIs/Procedures. With the infestation of HMOS dipping into Medicare, the cost to Medicare actually increased, with more hassles to the doctors who do referrals or then need preauthorizations, while the private health insurance companies skim off the Medicare fees. Old fashioned, regular Medicare is close to a PPO with nationally regulated fees that allow patients to see any primary or specialty doctor without needing referrals and for fair fees.
Privately insured patients are being ripped off. Currently thousands per year for premiums are paid per patient. The average office visit in my area is $55, with a patient coming in 2-4 times a year. Where does the large premium dollars go?
Insurance companies pay their administrators and credentialing departments big bucks, and hospital charge large fees for even regular beds or ER stays. An ER stay without admission can be $2,000. A 3 day stay in the regular bed in the hospital can be $5,000. CTs and MRIs are common.
What keeps the current system in place is the insurance companies, many of which have publicly traded stock, and the hospital system. Also the feeling that doing everything possible for patients who only have 3-7 days left to live is a common attitude in the US. It is easy for the system to spend $50,000 for a week in the ICU for a 90 year old male who has multiple MIs and CVAs with no hope of recovery. This takes health care dollars away from healthier people, such as the 50 yo with an MI and no insurance who waits to come in to avoid the expensive hospital stay.
Most sane doctors are interested in a single payer system. The insurance companies and hospitals need more regulation and are highly opposed to a single payer system. Billing likely would be simplified with a single payer system, and the AMA magically produces and charges for annual CPT billing code updates. A simplified payment and billing system, such as a national health savings card or equivalent, would eliminate the complicated CPT and ICD9 coding that often is contracted to outside billing agencies, who skim 8% off a doctor’s fees. Getting rid of the AMA, billing companies, and wasteful insurance companies would be a large step toward a single payer system. Magically these sources keep their political donations very large to the people who are against a single payer system. Doctors are simply the pawns to the administrators, who want to keep their high paying jobs skimming from the healthcare system.
Don’t those same CPT codes and ICD9 codes contribute to studies in both epidemiology and process efficiency? If you don’t “split” but only “lump”, how would you find regularities in clinical studies that suggest the probability of those deeper simplifications from which emerges “cure” and “health”? In other words, good coding, justified by the chart, is the foundation of a lot of progress in the clinic. CPT coding is actually quite reasonable, at least for Evaluation and Management. ICD9 (soon to be supplanted by ICD10) requires only that you know the hoof beats of your own horses in your own corral, and the occasional zebra.
If somebody is skimming 8% off you and you’re grossing, let’s say, $350,000 per year, wouldn’t it be worth closing down for a few days, looking at your diagnoses (ICD’s) and procedures (CPT’s), developing forms and processes specific to the epidemiology of your practice, and learning compliant documentation and coding? If we can learn the anatomy and physiology of humans, we can darn well learn the basic science of what will send our kids to the college of their choice. (It may not be OUR choice, of course).
We doc’s, as you imply, are rarely rich but often have cash flow. There’s always somebody who wants to string us along and make us dependent to the tune of at least 8%. Some might say – OK, I would say – that part of the debacle in health care is due to the fact that we doc’s historically fled from leading the solutions for managing our own affairs. We thought it sullied us, and I think that Ludmerer’s history of 20th century American medicine demonstrates this. If we assume that “health care” is a monolithic, unitary phenomenon requiring a ‘final solution’…well, be careful – we’ve heard that rhetoric before. And some folks liked it.
I do all my own coding and billing, saving me around $40,000 a year. Most of the docs in my community use billing agencies.
The ICD9 and CPT codes do not seem to be contributing to the epidemiology studies, as daily I get requests for cancer updates from the public health departments without any coding involved. More of the free paperwork that takes me away from seeing my patients. Also many of the CPT codes go unpaid by insurance companies, including ones for holiday care, after hours care, and telephone calls. The CPT codes often are rough guidelines. With experience, I learned not to do procedures and unrelated office visits on the same day, i.e. HTN/T2DM and needs a mole removal. Most insurance companies pay for the higher of two, meaning the office visit is denied, despite 2 valid CPT codes with a modifier on the E & M code.
It is the administrators of the health insurance companies and hospitals that are the wealthy ones who are trying to maintain their positions and not have a national payer system. Leaving the current system, as inefficient insurance companies that simply duplicate services, is causing the slow death spiral of US Healthcare.
Every doc should be like you, i.e., know, and more importantly, understand, the requirements of compliant CPT coding, and the use of appropriate documentation to validate those codes. That same documentation validates your ICD’s, of course. Every medical student should be taught this, and I don’t doubt that DB works on that every day. (We never did back at Illinois or Rush 30 years ago.)
When I say that appropriate coding is part of the foundation of good epidemiological studies, I mean that each diagnosis (ICD) forms the basis of retrospective reviews, no? If the diagnoses in the chart are incorrect (care is correct, but the doc just calls everybody “sepsis” in order to bill higher levels of service; yes, it happens) or idiosyncratic (“In my residency, Dr Fartguesser didn’t like the term ‘sepsis with urinary tract as portal of entry’; he preferred ‘urosepsis’ because that’s what HIS residency director called it, he said”) or not specified to the highest level of pathophysiological significance (I just call everybody ‘chest pain’ if they have an MI or a PE or GERD or Misplaced Gerbil Syndrome: they all have pain in their chest, don’t they?”), how would we draw explicit and logically motivated conclusions about the incidence and prevalence of disease? And therefore, make informed choices for therapy?
How would Petersdorf have written meaningfully about FUO’s in one of the most exquisite papers of all time?
How would you, and every other doc, make choices about appropriate therapy when somebody comes in with a CAP specific to your community? Central Georgia is awfully different from downtown Atlanta. Not that I ever go there.
And as for CPT, well, I agree it plays little role in epidemiology. It is an element in the modeling of a physician’s use of her valuable time. You use it, if informally, when you decide not to do E&M and procedures on the same day: the insurer’s model maximizes its ROI, and indeed you do exactly the same. (We’re not addressing what’s ethical. I personally think doc’s should make at least what the average baseball player gets. If he guesses right 30% of the time and bats .300, he’s a star. If you guess right 30% of the time, you’re wearing an orange jump suit and offering to remove the adenoids from Big Bubba for free.) Correct CPT coding and time studies can be our best friends to maximize our efficiency during the day. Ask a doc about her patients in the ICU, and she’ll tell you everything about them down to what key they booger whistle in at night. Ask that same doc about her life in the office, what her productivity is per each CPT, how that relates to her diagnoses and to what time she gets home and to how she makes payroll and what her Accounts Receivable are – the basic stuff that keeps her and hers alive – and you get that look we all remember from our Boards: “I know I know that…I know I ought to know that…gimme a second…well, my office manager should know…yeah, the one who just moved to Antigua with all our cash to be with her Perfect Match….”
Yup, we’re not supposed to think about this. Yup, Marcus Welby never did. Yup, “but what about the patients…..?” Every doc’s most important patient is himself or herself, and the older you get, the more important that face in the mirror becomes.
The radical artistry of medicine demands that the physician live in order to be able to practice that art.
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