Medicare

In the article “Common Coding Mistakes Hospitalists Should Avoid” in the August 2014 issue of The Hospitalist, the author states:

“For inpatient care, an established problem is defined as one in which a care plan has been generated by the physician (or same specialty group practice member) during the current hospitalization.”

This definition contradicts what I have been told in other coding courses regarding new vs. established problems relative to the examiner. It has been my understanding that when [I am] rotating on service and I have not seen that particular patient during the current admission, all of the current problems are new to me, even if previously identified by another member of my group. This [situation] results in a higher complexity of medical decision-making, which is reflective of the increased time spent learning a new patient when coming on service. I would appreciate clarification from the author.

–Matt George, MD,

medical director, MBHS Hospitalists

Billing and coding expert Carol Pohlig, BSN, RN, CPC, ACS, explains:

Be mindful when attending coding courses that are not contractor sponsored, as they may not validate the geographical interpretations of the rules for providers. There are several factors to consider when crediting the physician with “new” or “established” problems.

CMS documentation guidelines state: “Decision making with respect to a diagnosed problem is easier than that for an identified but undiagnosed problem.¹

• For a presenting problem with an established diagnosis, the record should reflect whether the problem is:

  • Improved, well-controlled, resolving, or resolved or
  • Inadequately controlled, worsening, or failing to change as expected.

• For a presenting problem without an established diagnosis, the assessment or clinical impression may be stated in the form of differential diagnoses or as a “possible,” “probable,” or “rule out” diagnosis.

Although Medicare contractors utilize the Marshfield Clinic Scoring Tool when reviewing evaluation and management (E/M) services, a tool that historically refers to the “examiner” when considering the patient’s diagnoses, not all accept this tool-inspired standard, particularly in the advent of electronic health record accessibility and the idea that same-specialty physicians in a group practice are viewed as an individual physician.^2,3

Reviewing information and familiarization of patients is often considered pre-service work and factored into the payment for E/M services. More importantly, the feasibility of an auditor being able to distinguish new vs. established problems at the level of the “examiner” is decreased when auditing a single date of service. Non-Medicare payers who audit E/M services do not necessarily follow contractor-specific guidelines but, rather, general CMS guidelines.

Therefore, without knowing the insurer or their interpretation at the time of service or visit level selection, the CMS-developed standard is the most practical application when considering the complexity of the encounter.

References

1. Centers for Medicare and Medicaid Services. Department of Health and Human Services. Evaluation and management services guide. Available at: http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads//eval_mgmt_serv_guide-ICN006764.pdf. Accessed November 13, 2014.
2. National Government Services. Evaluation and management documentation training too. Available at: http://www.ngsmedicare.com/ngs/wcm/connect/3632a905-b697-4266-8fc0-2aa2a84fedb2/1074_0514_EM_Documentation_Training_Tool_508.pdf?MOD=AJPERES. Accessed November 13, 2014.
3. Centers for Medicare and Medicaid Services. Medicare Claims Processing Manual. Chapter 12 – Physicians/nonphysician practitioners. Available at: http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c12.pdf. Accessed November 13, 2014.

In the article “Common Coding Mistakes Hospitalists Should Avoid” in the August 2014 issue of The Hospitalist, the author states:

“For inpatient care, an established problem is defined as one in which a care plan has been generated by the physician (or same specialty group practice member) during the current hospitalization.”

This definition contradicts what I have been told in other coding courses regarding new vs. established problems relative to the examiner. It has been my understanding that when [I am] rotating on service and I have not seen that particular patient during the current admission, all of the current problems are new to me, even if previously identified by another member of my group. This [situation] results in a higher complexity of medical decision-making, which is reflective of the increased time spent learning a new patient when coming on service. I would appreciate clarification from the author.

–Matt George, MD,

medical director, MBHS Hospitalists

Billing and coding expert Carol Pohlig, BSN, RN, CPC, ACS, explains:

Be mindful when attending coding courses that are not contractor sponsored, as they may not validate the geographical interpretations of the rules for providers. There are several factors to consider when crediting the physician with “new” or “established” problems.

CMS documentation guidelines state: “Decision making with respect to a diagnosed problem is easier than that for an identified but undiagnosed problem.¹

• For a presenting problem with an established diagnosis, the record should reflect whether the problem is:

  • Improved, well-controlled, resolving, or resolved or
  • Inadequately controlled, worsening, or failing to change as expected.

• For a presenting problem without an established diagnosis, the assessment or clinical impression may be stated in the form of differential diagnoses or as a “possible,” “probable,” or “rule out” diagnosis.

Although Medicare contractors utilize the Marshfield Clinic Scoring Tool when reviewing evaluation and management (E/M) services, a tool that historically refers to the “examiner” when considering the patient’s diagnoses, not all accept this tool-inspired standard, particularly in the advent of electronic health record accessibility and the idea that same-specialty physicians in a group practice are viewed as an individual physician.^2,3

Reviewing information and familiarization of patients is often considered pre-service work and factored into the payment for E/M services. More importantly, the feasibility of an auditor being able to distinguish new vs. established problems at the level of the “examiner” is decreased when auditing a single date of service. Non-Medicare payers who audit E/M services do not necessarily follow contractor-specific guidelines but, rather, general CMS guidelines.

Therefore, without knowing the insurer or their interpretation at the time of service or visit level selection, the CMS-developed standard is the most practical application when considering the complexity of the encounter.

References

1. Centers for Medicare and Medicaid Services. Department of Health and Human Services. Evaluation and management services guide. Available at: http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads//eval_mgmt_serv_guide-ICN006764.pdf. Accessed November 13, 2014.
2. National Government Services. Evaluation and management documentation training too. Available at: http://www.ngsmedicare.com/ngs/wcm/connect/3632a905-b697-4266-8fc0-2aa2a84fedb2/1074_0514_EM_Documentation_Training_Tool_508.pdf?MOD=AJPERES. Accessed November 13, 2014.
3. Centers for Medicare and Medicaid Services. Medicare Claims Processing Manual. Chapter 12 – Physicians/nonphysician practitioners. Available at: http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c12.pdf. Accessed November 13, 2014.

In the article “Common Coding Mistakes Hospitalists Should Avoid” in the August 2014 issue of The Hospitalist, the author states:

“For inpatient care, an established problem is defined as one in which a care plan has been generated by the physician (or same specialty group practice member) during the current hospitalization.”

This definition contradicts what I have been told in other coding courses regarding new vs. established problems relative to the examiner. It has been my understanding that when [I am] rotating on service and I have not seen that particular patient during the current admission, all of the current problems are new to me, even if previously identified by another member of my group. This [situation] results in a higher complexity of medical decision-making, which is reflective of the increased time spent learning a new patient when coming on service. I would appreciate clarification from the author.

–Matt George, MD,

medical director, MBHS Hospitalists

Billing and coding expert Carol Pohlig, BSN, RN, CPC, ACS, explains:

Be mindful when attending coding courses that are not contractor sponsored, as they may not validate the geographical interpretations of the rules for providers. There are several factors to consider when crediting the physician with “new” or “established” problems.

CMS documentation guidelines state: “Decision making with respect to a diagnosed problem is easier than that for an identified but undiagnosed problem.¹

• For a presenting problem with an established diagnosis, the record should reflect whether the problem is:

  • Improved, well-controlled, resolving, or resolved or
  • Inadequately controlled, worsening, or failing to change as expected.

• For a presenting problem without an established diagnosis, the assessment or clinical impression may be stated in the form of differential diagnoses or as a “possible,” “probable,” or “rule out” diagnosis.

Although Medicare contractors utilize the Marshfield Clinic Scoring Tool when reviewing evaluation and management (E/M) services, a tool that historically refers to the “examiner” when considering the patient’s diagnoses, not all accept this tool-inspired standard, particularly in the advent of electronic health record accessibility and the idea that same-specialty physicians in a group practice are viewed as an individual physician.^2,3

Reviewing information and familiarization of patients is often considered pre-service work and factored into the payment for E/M services. More importantly, the feasibility of an auditor being able to distinguish new vs. established problems at the level of the “examiner” is decreased when auditing a single date of service. Non-Medicare payers who audit E/M services do not necessarily follow contractor-specific guidelines but, rather, general CMS guidelines.

Therefore, without knowing the insurer or their interpretation at the time of service or visit level selection, the CMS-developed standard is the most practical application when considering the complexity of the encounter.

References

1. Centers for Medicare and Medicaid Services. Department of Health and Human Services. Evaluation and management services guide. Available at: http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads//eval_mgmt_serv_guide-ICN006764.pdf. Accessed November 13, 2014.
2. National Government Services. Evaluation and management documentation training too. Available at: http://www.ngsmedicare.com/ngs/wcm/connect/3632a905-b697-4266-8fc0-2aa2a84fedb2/1074_0514_EM_Documentation_Training_Tool_508.pdf?MOD=AJPERES. Accessed November 13, 2014.
3. Centers for Medicare and Medicaid Services. Medicare Claims Processing Manual. Chapter 12 – Physicians/nonphysician practitioners. Available at: http://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c12.pdf. Accessed November 13, 2014.

In late January, the Centers for Medicare and Medicaid Services (CMS) released the early results of two multi-year innovation projects focused on the creation of patient-centered medical homes (PCMHs).

Although PCMH models have been lauded as a way to achieve CMS’ triple aim —better quality patient care and improved health at a lower cost—little evidence currently backs up this claim. The latest reports show that PCMH interventions hold promise, but the jury is still out.

“I think, two to three years from now, we will be in a totally different position, in terms of a sound evidence base for policy,” says Mark Friedberg, MD, MPP, a practicing general internist and senior natural scientist for the RAND Corporation. “We know these very large CMS demonstrations are just starting to trickle in with year one results.”

Both the Comprehensive Primary Care (CPC) Initiative and the Multi-payer Advanced Primary Care Practice (MAPCP) are large, multi-year CMS demonstrations launched in 2012 and 2011, respectively, and the reports cover just their first 12 months. Although different in numerous ways, both projects aim to create better coordinated care that will in turn lower hospital admissions and ED visits, reduce duplications, enhance patient health through prevention, improve chronic disease management, and move away from a fee-for-service approach. They are just two of many experiments supported by the 10-year, $10 billion CMS Innovation Center.

In its first 12 months, the CPC focused on improving the care of high-risk patients in four states plus three separate regions of the U.S. It served 345,000 Medicare beneficiaries and roughly 2.5 million patients overall among nearly 500 primary care practices identified as likely to achieve meaningful results.

The evaluation, performed by policy research firm Mathematica, found that CPC cut hospital admissions by 2% and saw a 3% reduction in ED visits relative to similar practices not participating in the initiative, contributing to an overall $168 savings per Medicare beneficiary. It generated more than $70,000 in additional revenue per median practice clinician.¹

However, the Department of Health and Human Services (HHS) paid practices $240 per patient to cover the costs of establishing the medical home, including hiring nurses, improving electronic health records, and setting up 24-hour call lines. Thus, the initiative failed to offset its costs. Even so, Mathematica called the findings “promising” and “more favorable” than expected for the first year of the initiative, though it advised caution in interpreting the findings at this stage.

The MAPCP involved primary care initiatives in eight states, encompassing 3,800 providers across 700 practices; it touched 400,000 Medicare beneficiaries in its first year (today, it serves practices in just six states). Private payers and Medicaid also took part, leading to an estimated savings of $4.2 million, according to the initiative’s evaluators, RTI International and The Urban Institute.²

The demonstration realized a reduction in fee-for-service Medicare growth in Vermont and Michigan, largely resulting from lower inpatient expenditures, but did little to reduce hospitalizations, readmissions, or ED visits. Data collection and utilization were recurring challenges.

Dr. Friedberg says these first reports are akin to seeing the first few ships of the armada break the horizon. Last year, he was first author of a Journal of the American Medical Association study of a three-year PCMH intervention in Pennsylvania, Southeastern Pennsylvania’s Chronic Care Initiative, which also showed mixed results.³ He currently is part of a team evaluating the CMS Federally Qualified Health Center Advanced Primary Care Practice Demonstration, which concluded last October.

Although he has not yet seen an evaluation of a PCMH intervention involving hospitalists, Dr. Friedberg says it would be interesting to see the results of a rigorously studied pilot that involves such an evaluation. A 2012 article in The Hospitalist highlighted one project in Wisconsin and laid out ways in which hospitalists could be involved in PCMH initiatives—among them, being part of hospital admissions decision making and maintaining open lines of communication.⁴ Leaders of that project declined to comment at this time.

“The patient-centered medical home really is an outpatient strategy more than it is an inpatient strategy,” says Robert Centor, MD, MACP, an academic hospitalist at the University of Alabama Huntsville and chair of the Board of Regents of the American College of Physicians, yet he sees a role for hospitalists.

“If we start getting good results with patient-centered medical homes and more people go to the model, a relationship between the PCMH on the outpatient side and a cadre of people who know how to work the inpatient side is going to be critical to success,” Dr. Centor says.

Indeed, Dr. Friedberg says hospitalists’ involvement could be one of the “missing ingredients” that might contribute to the success of any given PCMH intervention, and he’s careful to emphasize there is no such thing as “the medical home.” Rather, there are “many medical homes,” he says.

Dr. Centor says hospitalists could serve as conduits between care inside the hospital and follow-up care, which could reduce length of stay for some patients and smooth the transition from discharge to primary care. A well-versed hospitalist with the PCMH might also assist in reducing repeat tests and procedures.

“I think it comes down to relationships more than anything else,” Dr. Centor says. “The challenge is, given all of the busyness of outpatient practice and inpatient care, how do we best communicate?”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

References

1. Mathematica Policy Research. Evaluation of the Comprehensive Primary Care Initiative: first annual report. Reference number 40102.R14. Available at: http://innovation.cms.gov/Files/reports/CPCI-EvalRpt1.pdf. Accessed March 4, 2015.
2. RTI International. Evaluation of the multi-payer advanced primary care practice (MAPCP) demonstration: first annual report. RTI Project Number 0212790.005.001.001. Available at: http://innovation.cms.gov/Files/reports/MAPCP-EvalRpt1.pdf. Accessed March 4, 2015.
3. Friedberg MW, Schneider EC, Rosenthal MB, Volpp KG, Werner RM. Association between participation in a multipayer medical home intervention and changes in quality, utilization, and costs of care. JAMA. 2014;311(8):815-825.
4. Collins T. Patients should prepare for the patient-centered medical home. The Hospitalist. July 3, 2012. Available at: http://www.the-hospitalist.org/article/hospitalists-should-prepare-for-the-patient-centered-medical-home/. Accessed March 4, 2015.

In late January, the Centers for Medicare and Medicaid Services (CMS) released the early results of two multi-year innovation projects focused on the creation of patient-centered medical homes (PCMHs).

Although PCMH models have been lauded as a way to achieve CMS’ triple aim —better quality patient care and improved health at a lower cost—little evidence currently backs up this claim. The latest reports show that PCMH interventions hold promise, but the jury is still out.

“I think, two to three years from now, we will be in a totally different position, in terms of a sound evidence base for policy,” says Mark Friedberg, MD, MPP, a practicing general internist and senior natural scientist for the RAND Corporation. “We know these very large CMS demonstrations are just starting to trickle in with year one results.”

Both the Comprehensive Primary Care (CPC) Initiative and the Multi-payer Advanced Primary Care Practice (MAPCP) are large, multi-year CMS demonstrations launched in 2012 and 2011, respectively, and the reports cover just their first 12 months. Although different in numerous ways, both projects aim to create better coordinated care that will in turn lower hospital admissions and ED visits, reduce duplications, enhance patient health through prevention, improve chronic disease management, and move away from a fee-for-service approach. They are just two of many experiments supported by the 10-year, $10 billion CMS Innovation Center.

In its first 12 months, the CPC focused on improving the care of high-risk patients in four states plus three separate regions of the U.S. It served 345,000 Medicare beneficiaries and roughly 2.5 million patients overall among nearly 500 primary care practices identified as likely to achieve meaningful results.

The evaluation, performed by policy research firm Mathematica, found that CPC cut hospital admissions by 2% and saw a 3% reduction in ED visits relative to similar practices not participating in the initiative, contributing to an overall $168 savings per Medicare beneficiary. It generated more than $70,000 in additional revenue per median practice clinician.¹

However, the Department of Health and Human Services (HHS) paid practices $240 per patient to cover the costs of establishing the medical home, including hiring nurses, improving electronic health records, and setting up 24-hour call lines. Thus, the initiative failed to offset its costs. Even so, Mathematica called the findings “promising” and “more favorable” than expected for the first year of the initiative, though it advised caution in interpreting the findings at this stage.

The MAPCP involved primary care initiatives in eight states, encompassing 3,800 providers across 700 practices; it touched 400,000 Medicare beneficiaries in its first year (today, it serves practices in just six states). Private payers and Medicaid also took part, leading to an estimated savings of $4.2 million, according to the initiative’s evaluators, RTI International and The Urban Institute.²

The demonstration realized a reduction in fee-for-service Medicare growth in Vermont and Michigan, largely resulting from lower inpatient expenditures, but did little to reduce hospitalizations, readmissions, or ED visits. Data collection and utilization were recurring challenges.

Dr. Friedberg says these first reports are akin to seeing the first few ships of the armada break the horizon. Last year, he was first author of a Journal of the American Medical Association study of a three-year PCMH intervention in Pennsylvania, Southeastern Pennsylvania’s Chronic Care Initiative, which also showed mixed results.³ He currently is part of a team evaluating the CMS Federally Qualified Health Center Advanced Primary Care Practice Demonstration, which concluded last October.

Although he has not yet seen an evaluation of a PCMH intervention involving hospitalists, Dr. Friedberg says it would be interesting to see the results of a rigorously studied pilot that involves such an evaluation. A 2012 article in The Hospitalist highlighted one project in Wisconsin and laid out ways in which hospitalists could be involved in PCMH initiatives—among them, being part of hospital admissions decision making and maintaining open lines of communication.⁴ Leaders of that project declined to comment at this time.

“The patient-centered medical home really is an outpatient strategy more than it is an inpatient strategy,” says Robert Centor, MD, MACP, an academic hospitalist at the University of Alabama Huntsville and chair of the Board of Regents of the American College of Physicians, yet he sees a role for hospitalists.

“If we start getting good results with patient-centered medical homes and more people go to the model, a relationship between the PCMH on the outpatient side and a cadre of people who know how to work the inpatient side is going to be critical to success,” Dr. Centor says.

Indeed, Dr. Friedberg says hospitalists’ involvement could be one of the “missing ingredients” that might contribute to the success of any given PCMH intervention, and he’s careful to emphasize there is no such thing as “the medical home.” Rather, there are “many medical homes,” he says.

Dr. Centor says hospitalists could serve as conduits between care inside the hospital and follow-up care, which could reduce length of stay for some patients and smooth the transition from discharge to primary care. A well-versed hospitalist with the PCMH might also assist in reducing repeat tests and procedures.

“I think it comes down to relationships more than anything else,” Dr. Centor says. “The challenge is, given all of the busyness of outpatient practice and inpatient care, how do we best communicate?”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

References

1. Mathematica Policy Research. Evaluation of the Comprehensive Primary Care Initiative: first annual report. Reference number 40102.R14. Available at: http://innovation.cms.gov/Files/reports/CPCI-EvalRpt1.pdf. Accessed March 4, 2015.
2. RTI International. Evaluation of the multi-payer advanced primary care practice (MAPCP) demonstration: first annual report. RTI Project Number 0212790.005.001.001. Available at: http://innovation.cms.gov/Files/reports/MAPCP-EvalRpt1.pdf. Accessed March 4, 2015.
3. Friedberg MW, Schneider EC, Rosenthal MB, Volpp KG, Werner RM. Association between participation in a multipayer medical home intervention and changes in quality, utilization, and costs of care. JAMA. 2014;311(8):815-825.
4. Collins T. Patients should prepare for the patient-centered medical home. The Hospitalist. July 3, 2012. Available at: http://www.the-hospitalist.org/article/hospitalists-should-prepare-for-the-patient-centered-medical-home/. Accessed March 4, 2015.

In late January, the Centers for Medicare and Medicaid Services (CMS) released the early results of two multi-year innovation projects focused on the creation of patient-centered medical homes (PCMHs).

Although PCMH models have been lauded as a way to achieve CMS’ triple aim —better quality patient care and improved health at a lower cost—little evidence currently backs up this claim. The latest reports show that PCMH interventions hold promise, but the jury is still out.

“I think, two to three years from now, we will be in a totally different position, in terms of a sound evidence base for policy,” says Mark Friedberg, MD, MPP, a practicing general internist and senior natural scientist for the RAND Corporation. “We know these very large CMS demonstrations are just starting to trickle in with year one results.”

Both the Comprehensive Primary Care (CPC) Initiative and the Multi-payer Advanced Primary Care Practice (MAPCP) are large, multi-year CMS demonstrations launched in 2012 and 2011, respectively, and the reports cover just their first 12 months. Although different in numerous ways, both projects aim to create better coordinated care that will in turn lower hospital admissions and ED visits, reduce duplications, enhance patient health through prevention, improve chronic disease management, and move away from a fee-for-service approach. They are just two of many experiments supported by the 10-year, $10 billion CMS Innovation Center.

In its first 12 months, the CPC focused on improving the care of high-risk patients in four states plus three separate regions of the U.S. It served 345,000 Medicare beneficiaries and roughly 2.5 million patients overall among nearly 500 primary care practices identified as likely to achieve meaningful results.

The evaluation, performed by policy research firm Mathematica, found that CPC cut hospital admissions by 2% and saw a 3% reduction in ED visits relative to similar practices not participating in the initiative, contributing to an overall $168 savings per Medicare beneficiary. It generated more than $70,000 in additional revenue per median practice clinician.¹

However, the Department of Health and Human Services (HHS) paid practices $240 per patient to cover the costs of establishing the medical home, including hiring nurses, improving electronic health records, and setting up 24-hour call lines. Thus, the initiative failed to offset its costs. Even so, Mathematica called the findings “promising” and “more favorable” than expected for the first year of the initiative, though it advised caution in interpreting the findings at this stage.

The MAPCP involved primary care initiatives in eight states, encompassing 3,800 providers across 700 practices; it touched 400,000 Medicare beneficiaries in its first year (today, it serves practices in just six states). Private payers and Medicaid also took part, leading to an estimated savings of $4.2 million, according to the initiative’s evaluators, RTI International and The Urban Institute.²

The demonstration realized a reduction in fee-for-service Medicare growth in Vermont and Michigan, largely resulting from lower inpatient expenditures, but did little to reduce hospitalizations, readmissions, or ED visits. Data collection and utilization were recurring challenges.

Dr. Friedberg says these first reports are akin to seeing the first few ships of the armada break the horizon. Last year, he was first author of a Journal of the American Medical Association study of a three-year PCMH intervention in Pennsylvania, Southeastern Pennsylvania’s Chronic Care Initiative, which also showed mixed results.³ He currently is part of a team evaluating the CMS Federally Qualified Health Center Advanced Primary Care Practice Demonstration, which concluded last October.

Although he has not yet seen an evaluation of a PCMH intervention involving hospitalists, Dr. Friedberg says it would be interesting to see the results of a rigorously studied pilot that involves such an evaluation. A 2012 article in The Hospitalist highlighted one project in Wisconsin and laid out ways in which hospitalists could be involved in PCMH initiatives—among them, being part of hospital admissions decision making and maintaining open lines of communication.⁴ Leaders of that project declined to comment at this time.

“The patient-centered medical home really is an outpatient strategy more than it is an inpatient strategy,” says Robert Centor, MD, MACP, an academic hospitalist at the University of Alabama Huntsville and chair of the Board of Regents of the American College of Physicians, yet he sees a role for hospitalists.

“If we start getting good results with patient-centered medical homes and more people go to the model, a relationship between the PCMH on the outpatient side and a cadre of people who know how to work the inpatient side is going to be critical to success,” Dr. Centor says.

Indeed, Dr. Friedberg says hospitalists’ involvement could be one of the “missing ingredients” that might contribute to the success of any given PCMH intervention, and he’s careful to emphasize there is no such thing as “the medical home.” Rather, there are “many medical homes,” he says.

Dr. Centor says hospitalists could serve as conduits between care inside the hospital and follow-up care, which could reduce length of stay for some patients and smooth the transition from discharge to primary care. A well-versed hospitalist with the PCMH might also assist in reducing repeat tests and procedures.

“I think it comes down to relationships more than anything else,” Dr. Centor says. “The challenge is, given all of the busyness of outpatient practice and inpatient care, how do we best communicate?”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

References

1. Mathematica Policy Research. Evaluation of the Comprehensive Primary Care Initiative: first annual report. Reference number 40102.R14. Available at: http://innovation.cms.gov/Files/reports/CPCI-EvalRpt1.pdf. Accessed March 4, 2015.
2. RTI International. Evaluation of the multi-payer advanced primary care practice (MAPCP) demonstration: first annual report. RTI Project Number 0212790.005.001.001. Available at: http://innovation.cms.gov/Files/reports/MAPCP-EvalRpt1.pdf. Accessed March 4, 2015.
3. Friedberg MW, Schneider EC, Rosenthal MB, Volpp KG, Werner RM. Association between participation in a multipayer medical home intervention and changes in quality, utilization, and costs of care. JAMA. 2014;311(8):815-825.
4. Collins T. Patients should prepare for the patient-centered medical home. The Hospitalist. July 3, 2012. Available at: http://www.the-hospitalist.org/article/hospitalists-should-prepare-for-the-patient-centered-medical-home/. Accessed March 4, 2015.

In December, the Altarum Institute’s Center for Elder Care and Advanced Illness released data showing that while San Diego County hospitals do better than national averages in reducing readmissions rates, nearly all of the eligible hospitals are being penalized by Medicare’s hospital readmissions penalty program because their discharges are being reduced through best practices at about the same rate as their reductions in readmissions.

The American Hospital Association and America’s Essential Hospitals (representing public hospitals) have both provided evidence to press their claims that the government’s Hospital Readmissions Reduction Program is unfair for refusing to adjust readmissions penalties and other hospital quality measures based on socioeconomic factors that influence readmission risk. A recent JAMA Viewpoint discusses an expert panel’s review of the National Quality Forum’s long-standing policy of not adjusting quality measures for sociodemographic risk factors out of a concern that it could create lower standards of care for disadvantaged patients. The panel concluded that this policy needed to be revisited.

Larry Beresford is a freelance writer in Alameda, Calif.

In December, the Altarum Institute’s Center for Elder Care and Advanced Illness released data showing that while San Diego County hospitals do better than national averages in reducing readmissions rates, nearly all of the eligible hospitals are being penalized by Medicare’s hospital readmissions penalty program because their discharges are being reduced through best practices at about the same rate as their reductions in readmissions.

The American Hospital Association and America’s Essential Hospitals (representing public hospitals) have both provided evidence to press their claims that the government’s Hospital Readmissions Reduction Program is unfair for refusing to adjust readmissions penalties and other hospital quality measures based on socioeconomic factors that influence readmission risk. A recent JAMA Viewpoint discusses an expert panel’s review of the National Quality Forum’s long-standing policy of not adjusting quality measures for sociodemographic risk factors out of a concern that it could create lower standards of care for disadvantaged patients. The panel concluded that this policy needed to be revisited.

Larry Beresford is a freelance writer in Alameda, Calif.

In December, the Altarum Institute’s Center for Elder Care and Advanced Illness released data showing that while San Diego County hospitals do better than national averages in reducing readmissions rates, nearly all of the eligible hospitals are being penalized by Medicare’s hospital readmissions penalty program because their discharges are being reduced through best practices at about the same rate as their reductions in readmissions.

The American Hospital Association and America’s Essential Hospitals (representing public hospitals) have both provided evidence to press their claims that the government’s Hospital Readmissions Reduction Program is unfair for refusing to adjust readmissions penalties and other hospital quality measures based on socioeconomic factors that influence readmission risk. A recent JAMA Viewpoint discusses an expert panel’s review of the National Quality Forum’s long-standing policy of not adjusting quality measures for sociodemographic risk factors out of a concern that it could create lower standards of care for disadvantaged patients. The panel concluded that this policy needed to be revisited.

Larry Beresford is a freelance writer in Alameda, Calif.

A widely cited statistic in the national readmissions debate holds that one in five acute hospital discharges will lead to a readmission within 30 days.¹ Associated costs are estimated at $17.5 billion, although that figure encapsulates significant variation across diagnoses, regions, and hospital models.¹ Analyses by CMS and others suggest that average 30-day readmission rates have been falling, albeit slowly, to 17.8% during the fourth quarter of 2012 after averaging 19% over the previous five years, according to Congressional testimony by Medicare Director Jonathan Blum in February 2013.²

CMS calculates “excessive readmissions rates” for subsequent hospital admissions to the same or a different hospital for specific diagnoses within 30 days of discharge, risk-adjusted for planned and unrelated readmissions using methodology endorsed by the National Quality Forum. Based on the hospital’s rate of actual to expected readmissions, HRRP penalties are applied to all Medicare-based diagnosis-related group (DRG) payments to the hospital for the fiscal year in question, to a maximum of 3% of Medicare payments. The list of conditions now includes heart failure, acute myocardial infarction, pneumonia, acute exacerbation of COPD, other lung ailments such as chronic bronchitis, and admissions for elective total hip and total knee arthroplasty.

Aggregate average penalty in FY2015 for 2,610 hospitals paying penalties, or three-fourths of those subject to the program, will be 0.63% of total base hospital DRG reimbursement, or approximately $428 million in total readmissions penalties. Thirty-nine hospitals are paying the full 3% penalty, based on their posted readmissions between July 2010 and June 2013.³ If a hospital has fewer than 25 discharges for a given condition, then CMS does not calculate its excess readmissions penalty for that condition.

In its June 2013 report to Congress, the Medicare Payment Advisory Commission (MedPAC), which first proposed readmissions payment incentives in 2008, recommended steps to refine the computation of penalties, all with “the goal that any policy change should maintain a hospital’s incentive to reduce readmissions.”⁴ CMS has stated that it is continuing to revise its algorithms for excluding planned and unrelated readmissions from the penalty calculation.⁵

MedPAC found that the rate of “potentially preventable readmissions” (PPR) was 12.3% in 2011, according to the “3M Algorithm” developed by 3M Health Information Systems, which uses administrative data to identify hospital readmissions that may indicate problems with quality of care. The PPR logic determines whether the reason for readmission is clinically related to a prior admission and therefore potentially preventable.⁶

Others define preventable readmissions in terms of quality problems, medical errors through actions taken or omitted during the initial hospital stay that could lead to patient harm.

Larry Beresford is a freelance writer in Alameda, Calif.

References

1. Jencks SF, Williams MV, Coleman EA. Rehospitalizations among patients in the Medicare fee-for-service program. N Engl J Med. 2009;360(14):1418-1428.
2. Blum J. Statement of Jonathan Blum on delivery system reform: progress report from CMS before the U.S. Senate Finance Committee. February 28, 2013. Available at: http://www.finance.senate.gov/imo/media/doc/CMS%20Delivery%20System%20Reform%20Testimony%202.28.13%20(J.%20Blum).pdf. Accessed March 12, 2015.
3. Rau J. Medicare Fines 2,610 Hospitals in Third Round of Readmissions Penalties. Kaiser Health News. October 2, 2014. Available at: http://kaiserhealthnews.org/news/medicare-readmissions-penalties-2015/. Accessed March 12, 2015.
4. Medicare Payment Advisory Commission. Report to the Congress: Medicare and the health care delivery system. Chapter 4: refining the hospital readmissions reduction program. June 2013. Available at: http://www.medpac.gov/documents/reports/jun13_entirereport.pdf. Accessed March 12, 2015.
5. Rodak S. CMS responds to 6 major critiques of readmissions measures. Becker’s Infection Control and Clinical Quality. August 7, 2013. Available at: http://www.beckershospitalreview.com/quality/cms-responds-to-6-major-critiques-of-readmission-measure.html. Accessed March 12 2015.
6. Goldfield NI, McCullough EC, Hughes JS, et al. Identifying potentially preventable readmissions. Healthcare Financing Review. Available at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Research/HealthCareFinancingReview/downloads/08Fallpg75.pdf. Accessed March 12, 2015.

A widely cited statistic in the national readmissions debate holds that one in five acute hospital discharges will lead to a readmission within 30 days.¹ Associated costs are estimated at $17.5 billion, although that figure encapsulates significant variation across diagnoses, regions, and hospital models.¹ Analyses by CMS and others suggest that average 30-day readmission rates have been falling, albeit slowly, to 17.8% during the fourth quarter of 2012 after averaging 19% over the previous five years, according to Congressional testimony by Medicare Director Jonathan Blum in February 2013.²

CMS calculates “excessive readmissions rates” for subsequent hospital admissions to the same or a different hospital for specific diagnoses within 30 days of discharge, risk-adjusted for planned and unrelated readmissions using methodology endorsed by the National Quality Forum. Based on the hospital’s rate of actual to expected readmissions, HRRP penalties are applied to all Medicare-based diagnosis-related group (DRG) payments to the hospital for the fiscal year in question, to a maximum of 3% of Medicare payments. The list of conditions now includes heart failure, acute myocardial infarction, pneumonia, acute exacerbation of COPD, other lung ailments such as chronic bronchitis, and admissions for elective total hip and total knee arthroplasty.

Aggregate average penalty in FY2015 for 2,610 hospitals paying penalties, or three-fourths of those subject to the program, will be 0.63% of total base hospital DRG reimbursement, or approximately $428 million in total readmissions penalties. Thirty-nine hospitals are paying the full 3% penalty, based on their posted readmissions between July 2010 and June 2013.³ If a hospital has fewer than 25 discharges for a given condition, then CMS does not calculate its excess readmissions penalty for that condition.

In its June 2013 report to Congress, the Medicare Payment Advisory Commission (MedPAC), which first proposed readmissions payment incentives in 2008, recommended steps to refine the computation of penalties, all with “the goal that any policy change should maintain a hospital’s incentive to reduce readmissions.”⁴ CMS has stated that it is continuing to revise its algorithms for excluding planned and unrelated readmissions from the penalty calculation.⁵

MedPAC found that the rate of “potentially preventable readmissions” (PPR) was 12.3% in 2011, according to the “3M Algorithm” developed by 3M Health Information Systems, which uses administrative data to identify hospital readmissions that may indicate problems with quality of care. The PPR logic determines whether the reason for readmission is clinically related to a prior admission and therefore potentially preventable.⁶

Others define preventable readmissions in terms of quality problems, medical errors through actions taken or omitted during the initial hospital stay that could lead to patient harm.

Larry Beresford is a freelance writer in Alameda, Calif.

References

1. Jencks SF, Williams MV, Coleman EA. Rehospitalizations among patients in the Medicare fee-for-service program. N Engl J Med. 2009;360(14):1418-1428.
2. Blum J. Statement of Jonathan Blum on delivery system reform: progress report from CMS before the U.S. Senate Finance Committee. February 28, 2013. Available at: http://www.finance.senate.gov/imo/media/doc/CMS%20Delivery%20System%20Reform%20Testimony%202.28.13%20(J.%20Blum).pdf. Accessed March 12, 2015.
3. Rau J. Medicare Fines 2,610 Hospitals in Third Round of Readmissions Penalties. Kaiser Health News. October 2, 2014. Available at: http://kaiserhealthnews.org/news/medicare-readmissions-penalties-2015/. Accessed March 12, 2015.
4. Medicare Payment Advisory Commission. Report to the Congress: Medicare and the health care delivery system. Chapter 4: refining the hospital readmissions reduction program. June 2013. Available at: http://www.medpac.gov/documents/reports/jun13_entirereport.pdf. Accessed March 12, 2015.
5. Rodak S. CMS responds to 6 major critiques of readmissions measures. Becker’s Infection Control and Clinical Quality. August 7, 2013. Available at: http://www.beckershospitalreview.com/quality/cms-responds-to-6-major-critiques-of-readmission-measure.html. Accessed March 12 2015.
6. Goldfield NI, McCullough EC, Hughes JS, et al. Identifying potentially preventable readmissions. Healthcare Financing Review. Available at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Research/HealthCareFinancingReview/downloads/08Fallpg75.pdf. Accessed March 12, 2015.

A widely cited statistic in the national readmissions debate holds that one in five acute hospital discharges will lead to a readmission within 30 days.¹ Associated costs are estimated at $17.5 billion, although that figure encapsulates significant variation across diagnoses, regions, and hospital models.¹ Analyses by CMS and others suggest that average 30-day readmission rates have been falling, albeit slowly, to 17.8% during the fourth quarter of 2012 after averaging 19% over the previous five years, according to Congressional testimony by Medicare Director Jonathan Blum in February 2013.²

CMS calculates “excessive readmissions rates” for subsequent hospital admissions to the same or a different hospital for specific diagnoses within 30 days of discharge, risk-adjusted for planned and unrelated readmissions using methodology endorsed by the National Quality Forum. Based on the hospital’s rate of actual to expected readmissions, HRRP penalties are applied to all Medicare-based diagnosis-related group (DRG) payments to the hospital for the fiscal year in question, to a maximum of 3% of Medicare payments. The list of conditions now includes heart failure, acute myocardial infarction, pneumonia, acute exacerbation of COPD, other lung ailments such as chronic bronchitis, and admissions for elective total hip and total knee arthroplasty.

Aggregate average penalty in FY2015 for 2,610 hospitals paying penalties, or three-fourths of those subject to the program, will be 0.63% of total base hospital DRG reimbursement, or approximately $428 million in total readmissions penalties. Thirty-nine hospitals are paying the full 3% penalty, based on their posted readmissions between July 2010 and June 2013.³ If a hospital has fewer than 25 discharges for a given condition, then CMS does not calculate its excess readmissions penalty for that condition.

In its June 2013 report to Congress, the Medicare Payment Advisory Commission (MedPAC), which first proposed readmissions payment incentives in 2008, recommended steps to refine the computation of penalties, all with “the goal that any policy change should maintain a hospital’s incentive to reduce readmissions.”⁴ CMS has stated that it is continuing to revise its algorithms for excluding planned and unrelated readmissions from the penalty calculation.⁵

MedPAC found that the rate of “potentially preventable readmissions” (PPR) was 12.3% in 2011, according to the “3M Algorithm” developed by 3M Health Information Systems, which uses administrative data to identify hospital readmissions that may indicate problems with quality of care. The PPR logic determines whether the reason for readmission is clinically related to a prior admission and therefore potentially preventable.⁶

Others define preventable readmissions in terms of quality problems, medical errors through actions taken or omitted during the initial hospital stay that could lead to patient harm.

Larry Beresford is a freelance writer in Alameda, Calif.

References

1. Jencks SF, Williams MV, Coleman EA. Rehospitalizations among patients in the Medicare fee-for-service program. N Engl J Med. 2009;360(14):1418-1428.
2. Blum J. Statement of Jonathan Blum on delivery system reform: progress report from CMS before the U.S. Senate Finance Committee. February 28, 2013. Available at: http://www.finance.senate.gov/imo/media/doc/CMS%20Delivery%20System%20Reform%20Testimony%202.28.13%20(J.%20Blum).pdf. Accessed March 12, 2015.
3. Rau J. Medicare Fines 2,610 Hospitals in Third Round of Readmissions Penalties. Kaiser Health News. October 2, 2014. Available at: http://kaiserhealthnews.org/news/medicare-readmissions-penalties-2015/. Accessed March 12, 2015.
4. Medicare Payment Advisory Commission. Report to the Congress: Medicare and the health care delivery system. Chapter 4: refining the hospital readmissions reduction program. June 2013. Available at: http://www.medpac.gov/documents/reports/jun13_entirereport.pdf. Accessed March 12, 2015.
5. Rodak S. CMS responds to 6 major critiques of readmissions measures. Becker’s Infection Control and Clinical Quality. August 7, 2013. Available at: http://www.beckershospitalreview.com/quality/cms-responds-to-6-major-critiques-of-readmission-measure.html. Accessed March 12 2015.
6. Goldfield NI, McCullough EC, Hughes JS, et al. Identifying potentially preventable readmissions. Healthcare Financing Review. Available at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Research/HealthCareFinancingReview/downloads/08Fallpg75.pdf. Accessed March 12, 2015.

Government penalties meant to reduce COPD readmissions will unfairly impact hospitals that care for vulnerable patients, according to a report from the University of Michigan.

Beginning in January 2015, the Centers for Medicare & Medicaid Services will add COPD to its list of medical conditions for which it penalizes hospitals for excessive readmissions and fines them up to 3% of their total Medicare reimbursement for COPD readmissions.

Researchers Michael W. Sjoding, MD, and Colin R. Cooke, MD, MSc, MS, both of the University of Michigan Institute for Healthcare Policy and Innovation in Ann Arbor, evaluated three years of data on 3,018 hospitals and found that COPD readmission rates ranged from 17% to 28% across all hospitals. Hospitals designated as major teaching hospitals, those with a high percentage of patients with low socioeconomic status, and those with a high volume of COPD patients were associated with higher COPD readmission rates (P<0.001 for all).

The findings were published last month in the American Journal of Respiratory and Critical Care Medicine.

"It has been shown that there is a correlation between patients' social structures and support at home and COPD readmissions," Dr. Sjoding says. "Economic resources and education level can also drive readmissions, situations that are beyond hospital control."

Policies that measure hospital quality, Dr. Sjoding says, are important to ensure that patients have access to quality care across the country. However, when creating policies aimed at reducing readmission rates, CMS should level the playing field, he says. For example, academic hospitals caring for complex patients should be compared against their peers.

"It's important that physicians speak up to make sure that policies do the right thing," he says.

Visit our website for more information about managing patients with COPD.

Government penalties meant to reduce COPD readmissions will unfairly impact hospitals that care for vulnerable patients, according to a report from the University of Michigan.

Beginning in January 2015, the Centers for Medicare & Medicaid Services will add COPD to its list of medical conditions for which it penalizes hospitals for excessive readmissions and fines them up to 3% of their total Medicare reimbursement for COPD readmissions.

Researchers Michael W. Sjoding, MD, and Colin R. Cooke, MD, MSc, MS, both of the University of Michigan Institute for Healthcare Policy and Innovation in Ann Arbor, evaluated three years of data on 3,018 hospitals and found that COPD readmission rates ranged from 17% to 28% across all hospitals. Hospitals designated as major teaching hospitals, those with a high percentage of patients with low socioeconomic status, and those with a high volume of COPD patients were associated with higher COPD readmission rates (P<0.001 for all).

The findings were published last month in the American Journal of Respiratory and Critical Care Medicine.

"It has been shown that there is a correlation between patients' social structures and support at home and COPD readmissions," Dr. Sjoding says. "Economic resources and education level can also drive readmissions, situations that are beyond hospital control."

Policies that measure hospital quality, Dr. Sjoding says, are important to ensure that patients have access to quality care across the country. However, when creating policies aimed at reducing readmission rates, CMS should level the playing field, he says. For example, academic hospitals caring for complex patients should be compared against their peers.

"It's important that physicians speak up to make sure that policies do the right thing," he says.

Visit our website for more information about managing patients with COPD.

Government penalties meant to reduce COPD readmissions will unfairly impact hospitals that care for vulnerable patients, according to a report from the University of Michigan.

Beginning in January 2015, the Centers for Medicare & Medicaid Services will add COPD to its list of medical conditions for which it penalizes hospitals for excessive readmissions and fines them up to 3% of their total Medicare reimbursement for COPD readmissions.

Researchers Michael W. Sjoding, MD, and Colin R. Cooke, MD, MSc, MS, both of the University of Michigan Institute for Healthcare Policy and Innovation in Ann Arbor, evaluated three years of data on 3,018 hospitals and found that COPD readmission rates ranged from 17% to 28% across all hospitals. Hospitals designated as major teaching hospitals, those with a high percentage of patients with low socioeconomic status, and those with a high volume of COPD patients were associated with higher COPD readmission rates (P<0.001 for all).

The findings were published last month in the American Journal of Respiratory and Critical Care Medicine.

"It has been shown that there is a correlation between patients' social structures and support at home and COPD readmissions," Dr. Sjoding says. "Economic resources and education level can also drive readmissions, situations that are beyond hospital control."

Policies that measure hospital quality, Dr. Sjoding says, are important to ensure that patients have access to quality care across the country. However, when creating policies aimed at reducing readmission rates, CMS should level the playing field, he says. For example, academic hospitals caring for complex patients should be compared against their peers.

"It's important that physicians speak up to make sure that policies do the right thing," he says.

Visit our website for more information about managing patients with COPD.

CMS started the third year of its Hospital Readmissions Reduction Program on October 1, with 2,610 U.S. hospitals—slightly more than in previous years—on the hook for penalties of up to 3% of their Medicare diagnosis-related grouping payments based on 30-day readmissions rates for diagnoses of myocardial infarction, heart failure, pneumonia, COPD, and elective total hip and total knee arthroplasty posted between July 2010 and June 2013.

According to analysis by Kaiser Health News, 39 hospitals will incur the maximum penalty, and hospitals collectively will pay an estimated $428 million in penalties in the current fiscal year for readmission rates deemed higher than expected by CMS formulas.

Medicare’s overall readmission rate in 2013 was 18%, which was down slightly from previous years but still amounted to two million patients. CMS estimates that these readmissions cost $26 billion, 65% of which was attributed to avoidable readmissions. CMS’ fiscal year 2015 final rule for reimbursement under the Hospital Inpatient Prospective Payment System, first published in the Federal Register, spells out fiscal year 2015 penalties and readmissions payment adjustment factors.

CMS started the third year of its Hospital Readmissions Reduction Program on October 1, with 2,610 U.S. hospitals—slightly more than in previous years—on the hook for penalties of up to 3% of their Medicare diagnosis-related grouping payments based on 30-day readmissions rates for diagnoses of myocardial infarction, heart failure, pneumonia, COPD, and elective total hip and total knee arthroplasty posted between July 2010 and June 2013.

According to analysis by Kaiser Health News, 39 hospitals will incur the maximum penalty, and hospitals collectively will pay an estimated $428 million in penalties in the current fiscal year for readmission rates deemed higher than expected by CMS formulas.

Medicare’s overall readmission rate in 2013 was 18%, which was down slightly from previous years but still amounted to two million patients. CMS estimates that these readmissions cost $26 billion, 65% of which was attributed to avoidable readmissions. CMS’ fiscal year 2015 final rule for reimbursement under the Hospital Inpatient Prospective Payment System, first published in the Federal Register, spells out fiscal year 2015 penalties and readmissions payment adjustment factors.

CMS started the third year of its Hospital Readmissions Reduction Program on October 1, with 2,610 U.S. hospitals—slightly more than in previous years—on the hook for penalties of up to 3% of their Medicare diagnosis-related grouping payments based on 30-day readmissions rates for diagnoses of myocardial infarction, heart failure, pneumonia, COPD, and elective total hip and total knee arthroplasty posted between July 2010 and June 2013.

According to analysis by Kaiser Health News, 39 hospitals will incur the maximum penalty, and hospitals collectively will pay an estimated $428 million in penalties in the current fiscal year for readmission rates deemed higher than expected by CMS formulas.

Medicare’s overall readmission rate in 2013 was 18%, which was down slightly from previous years but still amounted to two million patients. CMS estimates that these readmissions cost $26 billion, 65% of which was attributed to avoidable readmissions. CMS’ fiscal year 2015 final rule for reimbursement under the Hospital Inpatient Prospective Payment System, first published in the Federal Register, spells out fiscal year 2015 penalties and readmissions payment adjustment factors.

I’m convinced that observation status is rapidly becoming a meaningful factor in patients’ decision to file a malpractice lawsuit.

First, let me concede that I don’t know of any hard data to support my claim. I even asked the nation’s largest malpractice insurer about this, and they didn’t have any data on it. I think that is because observation status has only become a really big issue in the last couple of years, and since it typically takes several years for a malpractice suit to conclude, it just hasn’t found its way onto their radar yet.

But I’m pretty sure that will change within the next few years.

Implications

As any seasoned practitioner in our field knows, all outpatient and inpatient physician charges for Medicare patients, along with those of other licensed practitioners, are billed through Medicare Part B. After meeting a deductible, patients with traditional fee-for-service Medicare are generally responsible for 20% of all approved Part B charges, with no upper limit. For patients seen by a large number of providers while hospitalized, this 20% can really add up. Some patients have a secondary insurance that pays for this.

Hospital charges for patients on inpatient status are billed through Medicare Part A. Patients have an annual Part A deductible, and only in the case of very long inpatient stays will they have to pay more than that for inpatient care each year.

But hospital charges for patients on observation status are billed through Part B. And because hospital charges add up so quickly, the 20% of this that the patient is responsible for can be a lot of money—thousands of dollars, even for stays of less than 24 hours. Understandably, patients are not at all happy about this.

Let’s say you’re admitted overnight on observation status and your doctor orders your usual Advair inhaler. You use it once. Most hospitals aren’t able to ensure compliance with regulations around dispensing medications for home use like a pharmacy, so they won’t let you take the inhaler home. A few weeks later you’re stunned to learn that the hospital charged $10,000 for all services provided, and you’re responsible for 20% of the allowable amount PLUS the cost of all “self administered” drugs, like inhalers, eye drops, and calcitonin nasal spray. You look over your bill to see that you’re asked to pay $350 for the inhaler you used once and couldn’t even take home with you! Many self-administered medications, including eye drops and calcitonin nasal spray, result in similarly alarming charges to patients.

On top of the unpleasant surprise of a large hospital bill, Medicare won’t pay for skilled nursing facility (SNF) care for patients who are on observation status. That is, observation is not a “qualifying” stay for beneficiaries to access their SNF benefit.

It is easy to see why patients are unhappy about observation status.

The Media Message

News media are making the public aware of the potentially high financial costs they face if placed on observation status. But, too often, they oversimplify the issue, making it seem as though the choice of observation vs. inpatient status is entirely up to the treating doctor.

Saying that this decision is entirely up to the doctor is a lot like saying it is entirely up to you to determine how fast you drive on a freeway. In a sense that is correct, because no one else is in your car to control how fast you go and, in theory, you could choose to go 100 mph or 30 mph. The only problem is that it wouldn’t be long before you’d be in trouble with the law. So you don’t have complete autonomy to choose your speed; you have to comply with the laws. The same is true for doctors choosing observation status. We must comply with regulations in choosing the status or face legal consequences like fines or accusations of fraud.

Most news stories, like this one from NBC news (www.nbcnews.com/video/nightly-news/54511352#54511352) in February, are generally accurate but leave out the important fact that hospitals and doctors have little autonomy to choose the status the patient prefers. Instead, media often simply encourage patients on observation status to argue for a change to inpatient status and “be persistent.” More and more often, patients and families are arguing with the treating doctor; in many cases, that is a hospitalist.

Complaints Surge

At the 2014 SHM annual meeting last spring in Las Vegas, I spoke with many hospitalists who said that, increasingly, they are targets of observation-status complaints. One hospitalist group recently had each doctor list his or her top three frustrations with work; difficult and stressful conversations about observation status topped the list.

Patient anger regarding observation status can turn a satisfied patient into an angry one. We all know that unhappy patients are the ones most likely to pursue malpractice lawsuits. While anger over observation status doesn’t equal medical malpractice, it can change a patient’s opinion of our care, which may in some cases result in a malpractice claim.

Solutions

Medicare is unlikely to do away with observation status, so the best way to prevent complaints is to ensure that all its implications are explained to patients and families, ideally before they’re put into the hospital (e.g., while still in the ED). I think it is best if this message is delivered by someone other than the treating doctor(s): For example, a case manager might handle the discussion. Of course, patients and families are often too overwhelmed in the ED to absorb this information, so the message may need to be repeated later.

Maybe everyone should tell observation patients, “We’re going to observe you” without using any form of the word “admission.” And having these patients stay in distinct observation units probably reduces misunderstandings and complaints compared to the common practice of mixing these patients in “regular” hospital floors housing those on inpatient status.

Unfortunately, I couldn’t find research data to support this idea.

I bet some hospitals have even more elegant and effective ways to reduce misunderstandings and complaints around observation status. I’d love to hear from you if you know of any. E-mail me at [email protected].

I’m convinced that observation status is rapidly becoming a meaningful factor in patients’ decision to file a malpractice lawsuit.

First, let me concede that I don’t know of any hard data to support my claim. I even asked the nation’s largest malpractice insurer about this, and they didn’t have any data on it. I think that is because observation status has only become a really big issue in the last couple of years, and since it typically takes several years for a malpractice suit to conclude, it just hasn’t found its way onto their radar yet.

But I’m pretty sure that will change within the next few years.

Implications

As any seasoned practitioner in our field knows, all outpatient and inpatient physician charges for Medicare patients, along with those of other licensed practitioners, are billed through Medicare Part B. After meeting a deductible, patients with traditional fee-for-service Medicare are generally responsible for 20% of all approved Part B charges, with no upper limit. For patients seen by a large number of providers while hospitalized, this 20% can really add up. Some patients have a secondary insurance that pays for this.

Hospital charges for patients on inpatient status are billed through Medicare Part A. Patients have an annual Part A deductible, and only in the case of very long inpatient stays will they have to pay more than that for inpatient care each year.

But hospital charges for patients on observation status are billed through Part B. And because hospital charges add up so quickly, the 20% of this that the patient is responsible for can be a lot of money—thousands of dollars, even for stays of less than 24 hours. Understandably, patients are not at all happy about this.

Let’s say you’re admitted overnight on observation status and your doctor orders your usual Advair inhaler. You use it once. Most hospitals aren’t able to ensure compliance with regulations around dispensing medications for home use like a pharmacy, so they won’t let you take the inhaler home. A few weeks later you’re stunned to learn that the hospital charged $10,000 for all services provided, and you’re responsible for 20% of the allowable amount PLUS the cost of all “self administered” drugs, like inhalers, eye drops, and calcitonin nasal spray. You look over your bill to see that you’re asked to pay $350 for the inhaler you used once and couldn’t even take home with you! Many self-administered medications, including eye drops and calcitonin nasal spray, result in similarly alarming charges to patients.

On top of the unpleasant surprise of a large hospital bill, Medicare won’t pay for skilled nursing facility (SNF) care for patients who are on observation status. That is, observation is not a “qualifying” stay for beneficiaries to access their SNF benefit.

It is easy to see why patients are unhappy about observation status.

The Media Message

News media are making the public aware of the potentially high financial costs they face if placed on observation status. But, too often, they oversimplify the issue, making it seem as though the choice of observation vs. inpatient status is entirely up to the treating doctor.

Saying that this decision is entirely up to the doctor is a lot like saying it is entirely up to you to determine how fast you drive on a freeway. In a sense that is correct, because no one else is in your car to control how fast you go and, in theory, you could choose to go 100 mph or 30 mph. The only problem is that it wouldn’t be long before you’d be in trouble with the law. So you don’t have complete autonomy to choose your speed; you have to comply with the laws. The same is true for doctors choosing observation status. We must comply with regulations in choosing the status or face legal consequences like fines or accusations of fraud.

Most news stories, like this one from NBC news (www.nbcnews.com/video/nightly-news/54511352#54511352) in February, are generally accurate but leave out the important fact that hospitals and doctors have little autonomy to choose the status the patient prefers. Instead, media often simply encourage patients on observation status to argue for a change to inpatient status and “be persistent.” More and more often, patients and families are arguing with the treating doctor; in many cases, that is a hospitalist.

Complaints Surge

At the 2014 SHM annual meeting last spring in Las Vegas, I spoke with many hospitalists who said that, increasingly, they are targets of observation-status complaints. One hospitalist group recently had each doctor list his or her top three frustrations with work; difficult and stressful conversations about observation status topped the list.

Patient anger regarding observation status can turn a satisfied patient into an angry one. We all know that unhappy patients are the ones most likely to pursue malpractice lawsuits. While anger over observation status doesn’t equal medical malpractice, it can change a patient’s opinion of our care, which may in some cases result in a malpractice claim.

Solutions

Medicare is unlikely to do away with observation status, so the best way to prevent complaints is to ensure that all its implications are explained to patients and families, ideally before they’re put into the hospital (e.g., while still in the ED). I think it is best if this message is delivered by someone other than the treating doctor(s): For example, a case manager might handle the discussion. Of course, patients and families are often too overwhelmed in the ED to absorb this information, so the message may need to be repeated later.

Maybe everyone should tell observation patients, “We’re going to observe you” without using any form of the word “admission.” And having these patients stay in distinct observation units probably reduces misunderstandings and complaints compared to the common practice of mixing these patients in “regular” hospital floors housing those on inpatient status.

Unfortunately, I couldn’t find research data to support this idea.

I bet some hospitals have even more elegant and effective ways to reduce misunderstandings and complaints around observation status. I’d love to hear from you if you know of any. E-mail me at [email protected].

I’m convinced that observation status is rapidly becoming a meaningful factor in patients’ decision to file a malpractice lawsuit.

First, let me concede that I don’t know of any hard data to support my claim. I even asked the nation’s largest malpractice insurer about this, and they didn’t have any data on it. I think that is because observation status has only become a really big issue in the last couple of years, and since it typically takes several years for a malpractice suit to conclude, it just hasn’t found its way onto their radar yet.

But I’m pretty sure that will change within the next few years.

Implications

As any seasoned practitioner in our field knows, all outpatient and inpatient physician charges for Medicare patients, along with those of other licensed practitioners, are billed through Medicare Part B. After meeting a deductible, patients with traditional fee-for-service Medicare are generally responsible for 20% of all approved Part B charges, with no upper limit. For patients seen by a large number of providers while hospitalized, this 20% can really add up. Some patients have a secondary insurance that pays for this.

Hospital charges for patients on inpatient status are billed through Medicare Part A. Patients have an annual Part A deductible, and only in the case of very long inpatient stays will they have to pay more than that for inpatient care each year.

But hospital charges for patients on observation status are billed through Part B. And because hospital charges add up so quickly, the 20% of this that the patient is responsible for can be a lot of money—thousands of dollars, even for stays of less than 24 hours. Understandably, patients are not at all happy about this.

Let’s say you’re admitted overnight on observation status and your doctor orders your usual Advair inhaler. You use it once. Most hospitals aren’t able to ensure compliance with regulations around dispensing medications for home use like a pharmacy, so they won’t let you take the inhaler home. A few weeks later you’re stunned to learn that the hospital charged $10,000 for all services provided, and you’re responsible for 20% of the allowable amount PLUS the cost of all “self administered” drugs, like inhalers, eye drops, and calcitonin nasal spray. You look over your bill to see that you’re asked to pay $350 for the inhaler you used once and couldn’t even take home with you! Many self-administered medications, including eye drops and calcitonin nasal spray, result in similarly alarming charges to patients.

On top of the unpleasant surprise of a large hospital bill, Medicare won’t pay for skilled nursing facility (SNF) care for patients who are on observation status. That is, observation is not a “qualifying” stay for beneficiaries to access their SNF benefit.

It is easy to see why patients are unhappy about observation status.

The Media Message

News media are making the public aware of the potentially high financial costs they face if placed on observation status. But, too often, they oversimplify the issue, making it seem as though the choice of observation vs. inpatient status is entirely up to the treating doctor.

Saying that this decision is entirely up to the doctor is a lot like saying it is entirely up to you to determine how fast you drive on a freeway. In a sense that is correct, because no one else is in your car to control how fast you go and, in theory, you could choose to go 100 mph or 30 mph. The only problem is that it wouldn’t be long before you’d be in trouble with the law. So you don’t have complete autonomy to choose your speed; you have to comply with the laws. The same is true for doctors choosing observation status. We must comply with regulations in choosing the status or face legal consequences like fines or accusations of fraud.

Most news stories, like this one from NBC news (www.nbcnews.com/video/nightly-news/54511352#54511352) in February, are generally accurate but leave out the important fact that hospitals and doctors have little autonomy to choose the status the patient prefers. Instead, media often simply encourage patients on observation status to argue for a change to inpatient status and “be persistent.” More and more often, patients and families are arguing with the treating doctor; in many cases, that is a hospitalist.

Complaints Surge

At the 2014 SHM annual meeting last spring in Las Vegas, I spoke with many hospitalists who said that, increasingly, they are targets of observation-status complaints. One hospitalist group recently had each doctor list his or her top three frustrations with work; difficult and stressful conversations about observation status topped the list.

Patient anger regarding observation status can turn a satisfied patient into an angry one. We all know that unhappy patients are the ones most likely to pursue malpractice lawsuits. While anger over observation status doesn’t equal medical malpractice, it can change a patient’s opinion of our care, which may in some cases result in a malpractice claim.

Solutions

Medicare is unlikely to do away with observation status, so the best way to prevent complaints is to ensure that all its implications are explained to patients and families, ideally before they’re put into the hospital (e.g., while still in the ED). I think it is best if this message is delivered by someone other than the treating doctor(s): For example, a case manager might handle the discussion. Of course, patients and families are often too overwhelmed in the ED to absorb this information, so the message may need to be repeated later.

Maybe everyone should tell observation patients, “We’re going to observe you” without using any form of the word “admission.” And having these patients stay in distinct observation units probably reduces misunderstandings and complaints compared to the common practice of mixing these patients in “regular” hospital floors housing those on inpatient status.

Unfortunately, I couldn’t find research data to support this idea.

I bet some hospitals have even more elegant and effective ways to reduce misunderstandings and complaints around observation status. I’d love to hear from you if you know of any. E-mail me at [email protected].

Hospitals with the highest rates of preventable adverse events will soon see their Medicare reimbursements cut by 1%.

The Centers for Medicare and Medicaid Services (CMS) Hospital-Acquired Condition Reduction Program (HACRP) is a product of the Affordable Care Act, implemented to tackle the high number of patients who experience avoidable, adverse—and too often fatal—medical events in the hospital; however, while patient safety has been a crucial issue for years, and one largely ignored by Congress until recently, some experts say the new metrics used to evaluate safety and penalize the bottom 25% of hospitals are imprecise and stand to punish those that serve the sickest patients and those that are among the most diligent about tracking patient safety.

“The biggest surprise was how big of a difference there was between academic medical centers and safety-net hospitals and everybody else,” says Ashish Jha, MD, MPH, hospitalist at the VA Boston Healthcare System, professor of health policy at the Harvard School of Public Health, and part of a team that recently used the CMS measures—patient safety indicators (PSI), central line-associated bloodstream infections (CLABSI), and catheter-associated urinary tract infections (CAUTI)—to evaluate where the nation’s hospitals might fall under HACRP.

In its analysis, Dr. Jha’s team found that major teaching hospitals are 2.9% more likely to be penalized under the program than nonteaching hospitals. Large, urban, public, teaching hospitals in the Northeast, with lots of poor patients, have a 62% chance of being penalized, compared to just a 9% chance for small, rural, for-profit, nonteaching hospitals in the South.

In 1998, the Institutes of Medicine estimated that nearly 100,000 patients die every year due to preventable medical errors. A recent estimate in the Journal of Patient Safety says this number may now be as high as 440,000.

In 2012, CMS reported that one in eight Medicare patients incurred a potentially avoidable complication while in the hospital, a 9% reduction from the previous baseline in 2010.

Patient safety clearly is an issue in the United States. But whether all of the HACRP metrics decided upon by CMS are appropriate is up for debate.

“PSI scores…were initially developed to look at healthcare trends broadly and not for comparing institutional performance,” says Ken Sands, MD, MPH, senior vice president of healthcare quality and chief quality officer at Beth Israel Deaconess Medical Center. “They were hijacked for that purpose, and a lot of the measures are based on administrative data.”

Dr. Sands, like Dr. Jha, is concerned that variation in the way hospitals code can influence the rate of adverse events reported through PSIs—which scan billing codes for hospital complications—without a clearly defined set of rules and without clearly defined language. Hospitals vary in how hard they look for complications and in how diligently they code, Dr. Jha says. Hospitals looking for safety issues are more likely to find and code for them, compared to less attentive institutions.

“It’s an inexpensive way to collect data nationally,” Dr. Sands says. “But whether we’re discriminating on quality is not that clear.”

Beth Israel ranks better than most U.S. hospitals on measures of mortality yet falls to the bottom quartile of the hospital-acquired condition (HAC) measures. The medical center may be penalized starting in October.

Although Dr. Sands says his colleagues continue to work to improve their CAUTI rates, an endeavor that preceded the CMS program, he is seeking better training for his coding staff and is working within the medical center’s electronic health record (EHR) to ensure accurate and consistent reporting.

At small, rural Nanticoke Memorial Hospital in southern Delaware, which is not at risk of HAC penalties next year, chief operating officer and chief nursing officer Penny Short says the hospital is currently adopting a “pretty robust” EHR to assist clinicians with early identification of sepsis and other risks. She says there is a lot more that EHRs can do to assist in patient safety, and hospitalists at her institution have been at the helm, driving progress.

It’s an approach Dr. Jha advocates for moving the needle forward in identifying better patient safety metrics. Meaningful use of EHRs provides clinically based, high quality metrics that can be captured far more effectively than the billing record, he says, offering an “automated approach as a routine part of the delivery of health care for tracking and potentially identifying adverse events.”

It’s up to physician leaders, Dr. Jha says—indeed, it is their moral responsibility—to encourage their CEOs to make these investments. And it’s something he believes CMS should get behind as well.

“Is this going to be cheap and easy? No,” Dr. Jha says. “Does CMS have the capacity to say hospitals have to invest? I think they do.

“I think we can do so much better. The opportunity to do so much better is right now.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

Hospitals with the highest rates of preventable adverse events will soon see their Medicare reimbursements cut by 1%.

The Centers for Medicare and Medicaid Services (CMS) Hospital-Acquired Condition Reduction Program (HACRP) is a product of the Affordable Care Act, implemented to tackle the high number of patients who experience avoidable, adverse—and too often fatal—medical events in the hospital; however, while patient safety has been a crucial issue for years, and one largely ignored by Congress until recently, some experts say the new metrics used to evaluate safety and penalize the bottom 25% of hospitals are imprecise and stand to punish those that serve the sickest patients and those that are among the most diligent about tracking patient safety.

“The biggest surprise was how big of a difference there was between academic medical centers and safety-net hospitals and everybody else,” says Ashish Jha, MD, MPH, hospitalist at the VA Boston Healthcare System, professor of health policy at the Harvard School of Public Health, and part of a team that recently used the CMS measures—patient safety indicators (PSI), central line-associated bloodstream infections (CLABSI), and catheter-associated urinary tract infections (CAUTI)—to evaluate where the nation’s hospitals might fall under HACRP.

In its analysis, Dr. Jha’s team found that major teaching hospitals are 2.9% more likely to be penalized under the program than nonteaching hospitals. Large, urban, public, teaching hospitals in the Northeast, with lots of poor patients, have a 62% chance of being penalized, compared to just a 9% chance for small, rural, for-profit, nonteaching hospitals in the South.

In 1998, the Institutes of Medicine estimated that nearly 100,000 patients die every year due to preventable medical errors. A recent estimate in the Journal of Patient Safety says this number may now be as high as 440,000.

In 2012, CMS reported that one in eight Medicare patients incurred a potentially avoidable complication while in the hospital, a 9% reduction from the previous baseline in 2010.

Patient safety clearly is an issue in the United States. But whether all of the HACRP metrics decided upon by CMS are appropriate is up for debate.

“PSI scores…were initially developed to look at healthcare trends broadly and not for comparing institutional performance,” says Ken Sands, MD, MPH, senior vice president of healthcare quality and chief quality officer at Beth Israel Deaconess Medical Center. “They were hijacked for that purpose, and a lot of the measures are based on administrative data.”

Dr. Sands, like Dr. Jha, is concerned that variation in the way hospitals code can influence the rate of adverse events reported through PSIs—which scan billing codes for hospital complications—without a clearly defined set of rules and without clearly defined language. Hospitals vary in how hard they look for complications and in how diligently they code, Dr. Jha says. Hospitals looking for safety issues are more likely to find and code for them, compared to less attentive institutions.

“It’s an inexpensive way to collect data nationally,” Dr. Sands says. “But whether we’re discriminating on quality is not that clear.”

Beth Israel ranks better than most U.S. hospitals on measures of mortality yet falls to the bottom quartile of the hospital-acquired condition (HAC) measures. The medical center may be penalized starting in October.

Although Dr. Sands says his colleagues continue to work to improve their CAUTI rates, an endeavor that preceded the CMS program, he is seeking better training for his coding staff and is working within the medical center’s electronic health record (EHR) to ensure accurate and consistent reporting.

At small, rural Nanticoke Memorial Hospital in southern Delaware, which is not at risk of HAC penalties next year, chief operating officer and chief nursing officer Penny Short says the hospital is currently adopting a “pretty robust” EHR to assist clinicians with early identification of sepsis and other risks. She says there is a lot more that EHRs can do to assist in patient safety, and hospitalists at her institution have been at the helm, driving progress.

It’s an approach Dr. Jha advocates for moving the needle forward in identifying better patient safety metrics. Meaningful use of EHRs provides clinically based, high quality metrics that can be captured far more effectively than the billing record, he says, offering an “automated approach as a routine part of the delivery of health care for tracking and potentially identifying adverse events.”

It’s up to physician leaders, Dr. Jha says—indeed, it is their moral responsibility—to encourage their CEOs to make these investments. And it’s something he believes CMS should get behind as well.

“Is this going to be cheap and easy? No,” Dr. Jha says. “Does CMS have the capacity to say hospitals have to invest? I think they do.

“I think we can do so much better. The opportunity to do so much better is right now.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

Hospitals with the highest rates of preventable adverse events will soon see their Medicare reimbursements cut by 1%.

The Centers for Medicare and Medicaid Services (CMS) Hospital-Acquired Condition Reduction Program (HACRP) is a product of the Affordable Care Act, implemented to tackle the high number of patients who experience avoidable, adverse—and too often fatal—medical events in the hospital; however, while patient safety has been a crucial issue for years, and one largely ignored by Congress until recently, some experts say the new metrics used to evaluate safety and penalize the bottom 25% of hospitals are imprecise and stand to punish those that serve the sickest patients and those that are among the most diligent about tracking patient safety.

“The biggest surprise was how big of a difference there was between academic medical centers and safety-net hospitals and everybody else,” says Ashish Jha, MD, MPH, hospitalist at the VA Boston Healthcare System, professor of health policy at the Harvard School of Public Health, and part of a team that recently used the CMS measures—patient safety indicators (PSI), central line-associated bloodstream infections (CLABSI), and catheter-associated urinary tract infections (CAUTI)—to evaluate where the nation’s hospitals might fall under HACRP.

In its analysis, Dr. Jha’s team found that major teaching hospitals are 2.9% more likely to be penalized under the program than nonteaching hospitals. Large, urban, public, teaching hospitals in the Northeast, with lots of poor patients, have a 62% chance of being penalized, compared to just a 9% chance for small, rural, for-profit, nonteaching hospitals in the South.

In 1998, the Institutes of Medicine estimated that nearly 100,000 patients die every year due to preventable medical errors. A recent estimate in the Journal of Patient Safety says this number may now be as high as 440,000.

In 2012, CMS reported that one in eight Medicare patients incurred a potentially avoidable complication while in the hospital, a 9% reduction from the previous baseline in 2010.

Patient safety clearly is an issue in the United States. But whether all of the HACRP metrics decided upon by CMS are appropriate is up for debate.

“PSI scores…were initially developed to look at healthcare trends broadly and not for comparing institutional performance,” says Ken Sands, MD, MPH, senior vice president of healthcare quality and chief quality officer at Beth Israel Deaconess Medical Center. “They were hijacked for that purpose, and a lot of the measures are based on administrative data.”

Dr. Sands, like Dr. Jha, is concerned that variation in the way hospitals code can influence the rate of adverse events reported through PSIs—which scan billing codes for hospital complications—without a clearly defined set of rules and without clearly defined language. Hospitals vary in how hard they look for complications and in how diligently they code, Dr. Jha says. Hospitals looking for safety issues are more likely to find and code for them, compared to less attentive institutions.

“It’s an inexpensive way to collect data nationally,” Dr. Sands says. “But whether we’re discriminating on quality is not that clear.”

Beth Israel ranks better than most U.S. hospitals on measures of mortality yet falls to the bottom quartile of the hospital-acquired condition (HAC) measures. The medical center may be penalized starting in October.

Although Dr. Sands says his colleagues continue to work to improve their CAUTI rates, an endeavor that preceded the CMS program, he is seeking better training for his coding staff and is working within the medical center’s electronic health record (EHR) to ensure accurate and consistent reporting.

At small, rural Nanticoke Memorial Hospital in southern Delaware, which is not at risk of HAC penalties next year, chief operating officer and chief nursing officer Penny Short says the hospital is currently adopting a “pretty robust” EHR to assist clinicians with early identification of sepsis and other risks. She says there is a lot more that EHRs can do to assist in patient safety, and hospitalists at her institution have been at the helm, driving progress.

It’s an approach Dr. Jha advocates for moving the needle forward in identifying better patient safety metrics. Meaningful use of EHRs provides clinically based, high quality metrics that can be captured far more effectively than the billing record, he says, offering an “automated approach as a routine part of the delivery of health care for tracking and potentially identifying adverse events.”

It’s up to physician leaders, Dr. Jha says—indeed, it is their moral responsibility—to encourage their CEOs to make these investments. And it’s something he believes CMS should get behind as well.

“Is this going to be cheap and easy? No,” Dr. Jha says. “Does CMS have the capacity to say hospitals have to invest? I think they do.

“I think we can do so much better. The opportunity to do so much better is right now.”

Kelly April Tyrrell is a freelance writer in Madison, Wis.

Where there is variation, there is room for improvement. The Institute of Medicine’s report on geographic variation in Medicare spending concluded that the largest contributor to overall spending variation is spending for post-acute care services.1 Furthermore, we know that a significant amount of overall spending is devoted to post-acute care. For example, for patients hospitalized with a flare-up of a chronic condition like COPD or heart failure, Medicare spends nearly as much on post-acute care and readmissions in the first 30 days after discharge as it does on the initial admission.¹

What does this mean for hospitalists?

Numerous research articles and quality improvement projects have focused on what makes a good hospital discharge or hand off to the ‘next provider of care’; however, hospitalists are increasingly participating in value-based payment programs like accountable care organizations (ACOs), risk contracts, and bundled payments. This means they must begin to pay attention to the cost side of the value equation (quality divided by cost) as it relates to hospital discharge.

A day of home care represents a more cost-effective alternative than a day of care in a skilled nursing facility (SNF). Hospitalists who can identify those patients who are appropriate to send home with home health services—and who otherwise would have gone to a SNF—will serve the dual goals of improving patient experience and decreasing costs.

Hospitalists will need to develop a decision-making process that determines the appropriate level of care for the patient after discharge. The decision-making process should address questions like:

• What skilled services lead a patient to go to a SNF instead of home with home health?
• Which patients go to a SNF instead of home simply because they don’t have family or a caregiver to help them with activities of daily living?
• Are there services requiring a nurse or a therapist that can’t be delivered in the home?

Hospitalists also will need to develop a more intimate understanding of the following levels of care:

• Skilled nursing includes management of a nursing care plan, assessment of a patient’s changing condition, and services like wound care, infusion therapy, and management of medications, feeding or drainage tubes, and pain.
• Skilled rehabilitation refers to the array of services provided by physical, occupational, speech, and respiratory therapists.
• Custodial care, usually supplied by a home health aid or family member, includes help with activities of daily living (feeding, dressing, bathing, grooming, personal hygiene, and toileting).

It should be noted that most skilled nursing or therapy services can be delivered in the home setting if the patient’s custodial care needs are met—a big ‘if’ in some cases. Some patients go to a SNF because they require three or more skilled nursing or therapy services, and it is therefore impractical for them to go home.

Here are my suggestions to hospitalists seeking to reengineer the discharge process with the goals of “right-sizing” the number of patients who go to SNFs and optimizing the utilization of home healthcare services:

• Become familiar with the range of post-acute care providers and care coordination services in your community.
• Refer any patient who wishes to go home, either directly or after a SNF stay, for a home care evaluation. Home care agencies are experts in determining if and how patients can return home.
• If a need for help with activities of daily living is the major barrier to having a patient discharged to home, create a system in which case management develops a custodial care plan with the patient and caregivers during the inpatient stay. Currently, this step is delayed until well into the SNF stay and may prolong that stay. Such a plan includes a financial analysis, screening for Medicaid eligibility, and evaluating whether a family member can assume some or all of the custodial care needs.
• If a patient is being discharged to a SNF, review the list of needed services leading to the SNF transfer. Ask the case manager if these services can be provided in the home. If not, then why?
• Bed capacity permitting, consider keeping patients who are functionally improving in the hospital an extra day so they can be discharged directly home instead of to a SNF.²

In his seminal work, The Innovator’s Dilemma, Clayton Christensen describes “disruptive innovation” as that which gives rise to products or services that are cheaper, simpler, and more convenient to use. Even though home care has been around for a while, there is a sizeable group of patients, especially in geographic areas of high SNF spending, who might be better served in the home environment. As we create better systems under value-based payment, we should see an increase in the use of home healthcare as a disruptive innovation when applied to appropriate patients transitioning out of the hospital or a SNF.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at [email protected].

References

1. Newhouse JP, Garber AM. Geographic variation in Medicare services. N Engl J Med. 2013;368:1465-1468.
2. Mechanic R. Post-acute care—The next frontier for controlling Medicare spending. N Engl J Med. 2014;370(8):692-694.

Where there is variation, there is room for improvement. The Institute of Medicine’s report on geographic variation in Medicare spending concluded that the largest contributor to overall spending variation is spending for post-acute care services.1 Furthermore, we know that a significant amount of overall spending is devoted to post-acute care. For example, for patients hospitalized with a flare-up of a chronic condition like COPD or heart failure, Medicare spends nearly as much on post-acute care and readmissions in the first 30 days after discharge as it does on the initial admission.¹

What does this mean for hospitalists?

Numerous research articles and quality improvement projects have focused on what makes a good hospital discharge or hand off to the ‘next provider of care’; however, hospitalists are increasingly participating in value-based payment programs like accountable care organizations (ACOs), risk contracts, and bundled payments. This means they must begin to pay attention to the cost side of the value equation (quality divided by cost) as it relates to hospital discharge.

A day of home care represents a more cost-effective alternative than a day of care in a skilled nursing facility (SNF). Hospitalists who can identify those patients who are appropriate to send home with home health services—and who otherwise would have gone to a SNF—will serve the dual goals of improving patient experience and decreasing costs.

Hospitalists will need to develop a decision-making process that determines the appropriate level of care for the patient after discharge. The decision-making process should address questions like:

• What skilled services lead a patient to go to a SNF instead of home with home health?
• Which patients go to a SNF instead of home simply because they don’t have family or a caregiver to help them with activities of daily living?
• Are there services requiring a nurse or a therapist that can’t be delivered in the home?

Hospitalists also will need to develop a more intimate understanding of the following levels of care:

• Skilled nursing includes management of a nursing care plan, assessment of a patient’s changing condition, and services like wound care, infusion therapy, and management of medications, feeding or drainage tubes, and pain.
• Skilled rehabilitation refers to the array of services provided by physical, occupational, speech, and respiratory therapists.
• Custodial care, usually supplied by a home health aid or family member, includes help with activities of daily living (feeding, dressing, bathing, grooming, personal hygiene, and toileting).

It should be noted that most skilled nursing or therapy services can be delivered in the home setting if the patient’s custodial care needs are met—a big ‘if’ in some cases. Some patients go to a SNF because they require three or more skilled nursing or therapy services, and it is therefore impractical for them to go home.

Here are my suggestions to hospitalists seeking to reengineer the discharge process with the goals of “right-sizing” the number of patients who go to SNFs and optimizing the utilization of home healthcare services:

• Become familiar with the range of post-acute care providers and care coordination services in your community.
• Refer any patient who wishes to go home, either directly or after a SNF stay, for a home care evaluation. Home care agencies are experts in determining if and how patients can return home.
• If a need for help with activities of daily living is the major barrier to having a patient discharged to home, create a system in which case management develops a custodial care plan with the patient and caregivers during the inpatient stay. Currently, this step is delayed until well into the SNF stay and may prolong that stay. Such a plan includes a financial analysis, screening for Medicaid eligibility, and evaluating whether a family member can assume some or all of the custodial care needs.
• If a patient is being discharged to a SNF, review the list of needed services leading to the SNF transfer. Ask the case manager if these services can be provided in the home. If not, then why?
• Bed capacity permitting, consider keeping patients who are functionally improving in the hospital an extra day so they can be discharged directly home instead of to a SNF.²

In his seminal work, The Innovator’s Dilemma, Clayton Christensen describes “disruptive innovation” as that which gives rise to products or services that are cheaper, simpler, and more convenient to use. Even though home care has been around for a while, there is a sizeable group of patients, especially in geographic areas of high SNF spending, who might be better served in the home environment. As we create better systems under value-based payment, we should see an increase in the use of home healthcare as a disruptive innovation when applied to appropriate patients transitioning out of the hospital or a SNF.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at [email protected].

References

1. Newhouse JP, Garber AM. Geographic variation in Medicare services. N Engl J Med. 2013;368:1465-1468.
2. Mechanic R. Post-acute care—The next frontier for controlling Medicare spending. N Engl J Med. 2014;370(8):692-694.

Where there is variation, there is room for improvement. The Institute of Medicine’s report on geographic variation in Medicare spending concluded that the largest contributor to overall spending variation is spending for post-acute care services.1 Furthermore, we know that a significant amount of overall spending is devoted to post-acute care. For example, for patients hospitalized with a flare-up of a chronic condition like COPD or heart failure, Medicare spends nearly as much on post-acute care and readmissions in the first 30 days after discharge as it does on the initial admission.¹

What does this mean for hospitalists?

Numerous research articles and quality improvement projects have focused on what makes a good hospital discharge or hand off to the ‘next provider of care’; however, hospitalists are increasingly participating in value-based payment programs like accountable care organizations (ACOs), risk contracts, and bundled payments. This means they must begin to pay attention to the cost side of the value equation (quality divided by cost) as it relates to hospital discharge.

A day of home care represents a more cost-effective alternative than a day of care in a skilled nursing facility (SNF). Hospitalists who can identify those patients who are appropriate to send home with home health services—and who otherwise would have gone to a SNF—will serve the dual goals of improving patient experience and decreasing costs.

Hospitalists will need to develop a decision-making process that determines the appropriate level of care for the patient after discharge. The decision-making process should address questions like:

• What skilled services lead a patient to go to a SNF instead of home with home health?
• Which patients go to a SNF instead of home simply because they don’t have family or a caregiver to help them with activities of daily living?
• Are there services requiring a nurse or a therapist that can’t be delivered in the home?

Hospitalists also will need to develop a more intimate understanding of the following levels of care:

• Skilled nursing includes management of a nursing care plan, assessment of a patient’s changing condition, and services like wound care, infusion therapy, and management of medications, feeding or drainage tubes, and pain.
• Skilled rehabilitation refers to the array of services provided by physical, occupational, speech, and respiratory therapists.
• Custodial care, usually supplied by a home health aid or family member, includes help with activities of daily living (feeding, dressing, bathing, grooming, personal hygiene, and toileting).

It should be noted that most skilled nursing or therapy services can be delivered in the home setting if the patient’s custodial care needs are met—a big ‘if’ in some cases. Some patients go to a SNF because they require three or more skilled nursing or therapy services, and it is therefore impractical for them to go home.

Here are my suggestions to hospitalists seeking to reengineer the discharge process with the goals of “right-sizing” the number of patients who go to SNFs and optimizing the utilization of home healthcare services:

• Become familiar with the range of post-acute care providers and care coordination services in your community.
• Refer any patient who wishes to go home, either directly or after a SNF stay, for a home care evaluation. Home care agencies are experts in determining if and how patients can return home.
• If a need for help with activities of daily living is the major barrier to having a patient discharged to home, create a system in which case management develops a custodial care plan with the patient and caregivers during the inpatient stay. Currently, this step is delayed until well into the SNF stay and may prolong that stay. Such a plan includes a financial analysis, screening for Medicaid eligibility, and evaluating whether a family member can assume some or all of the custodial care needs.
• If a patient is being discharged to a SNF, review the list of needed services leading to the SNF transfer. Ask the case manager if these services can be provided in the home. If not, then why?
• Bed capacity permitting, consider keeping patients who are functionally improving in the hospital an extra day so they can be discharged directly home instead of to a SNF.²

In his seminal work, The Innovator’s Dilemma, Clayton Christensen describes “disruptive innovation” as that which gives rise to products or services that are cheaper, simpler, and more convenient to use. Even though home care has been around for a while, there is a sizeable group of patients, especially in geographic areas of high SNF spending, who might be better served in the home environment. As we create better systems under value-based payment, we should see an increase in the use of home healthcare as a disruptive innovation when applied to appropriate patients transitioning out of the hospital or a SNF.

Dr. Whitcomb is Chief Medical Officer of Remedy Partners. He is co-founder and past president of SHM. Email him at [email protected].

References

1. Newhouse JP, Garber AM. Geographic variation in Medicare services. N Engl J Med. 2013;368:1465-1468.
2. Mechanic R. Post-acute care—The next frontier for controlling Medicare spending. N Engl J Med. 2014;370(8):692-694.

The role of nonclinical factors in shaping rates of rehospitalization has been explored in several recent studies—and targeted through new legislation endorsed by the Society of Hospital Medicine. A study in Health Affairs compared hospital performance on 30-day readmissions for the first three diagnoses included in penalty calculations for CMS’ Hospital Readmissions Reduction Program (HRRP) and found that adjusting for patients’ socioeconomic status significantly reduced the rates of variation in readmissions between hospitals across the state of Missouri.¹

For patients discharged between 2009 and 2012, analysis using a model enriched with census tract socioeconomic data found that the range of variation in readmissions between hospitals decreased to 1.8% from 6.5% for patients with acute myocardial infarction; to 7.4% from 14.0% for congestive heart failure; and to 3.7% from 7.4% for pneumonia, compared with rates unadjusted for these socioeconomic factors. Another study in the same journal by researchers at an urban teaching hospital found that patients living in high-poverty neighborhoods were 24% more likely to be readmitted to the hospital within 30 days, after adjusting for demographic and clinical characteristics.²

For a factor that may be more amenable to intervention by hospitalists, a standardized rehabilitation medicine test measuring patients’ ability to perform everyday tasks of living, such as the ability to move independently from bed to chair, wheelchair, or toilet was found to be a good predictor of readmissions.³ Few hospitals currently require assessment of their patients’ functional ability, notes the study’s lead author Erik Hoyer, MD, assistant professor in the department of physical medicine and rehabilitation at the Johns Hopkins University School of Medicine in Baltimore. But the score “is a direct reflection of the patient’s ability to heal [outside of the hospital].”

The Functional Independence Measure used in this study and in inpatient rehabilitation facilities nationwide is probably not the right tool for hospitalists because of its length and the training required to administer it, Dr. Hoyer says.

“There are other, easier tools that are available or in development that may also serve a similar purpose,” he says. “The main point is that routine functional assessment is important in the hospital setting, and developing strategies to improve patient function is likely an important way to improve outcomes such as hospital readmissions.”

The documented role of socioeconomic status in determining readmissions also is addressed by legislation introduced by Rep. Jim Renacci (R-Ohio) and supported by both the Society of Hospital Medicine and the American Hospital Association. The Establishing Beneficiary Equity in the Hospital Readmission Program Act (HR-4188) would adjust HRRP readmissions penalties to reflect “certain socioeconomic and health factors that increase the patient’s risk of readmissions.”

Larry Beresford is a freelance writer in Alameda, Calif.

The role of nonclinical factors in shaping rates of rehospitalization has been explored in several recent studies—and targeted through new legislation endorsed by the Society of Hospital Medicine. A study in Health Affairs compared hospital performance on 30-day readmissions for the first three diagnoses included in penalty calculations for CMS’ Hospital Readmissions Reduction Program (HRRP) and found that adjusting for patients’ socioeconomic status significantly reduced the rates of variation in readmissions between hospitals across the state of Missouri.¹

For patients discharged between 2009 and 2012, analysis using a model enriched with census tract socioeconomic data found that the range of variation in readmissions between hospitals decreased to 1.8% from 6.5% for patients with acute myocardial infarction; to 7.4% from 14.0% for congestive heart failure; and to 3.7% from 7.4% for pneumonia, compared with rates unadjusted for these socioeconomic factors. Another study in the same journal by researchers at an urban teaching hospital found that patients living in high-poverty neighborhoods were 24% more likely to be readmitted to the hospital within 30 days, after adjusting for demographic and clinical characteristics.²

For a factor that may be more amenable to intervention by hospitalists, a standardized rehabilitation medicine test measuring patients’ ability to perform everyday tasks of living, such as the ability to move independently from bed to chair, wheelchair, or toilet was found to be a good predictor of readmissions.³ Few hospitals currently require assessment of their patients’ functional ability, notes the study’s lead author Erik Hoyer, MD, assistant professor in the department of physical medicine and rehabilitation at the Johns Hopkins University School of Medicine in Baltimore. But the score “is a direct reflection of the patient’s ability to heal [outside of the hospital].”

The Functional Independence Measure used in this study and in inpatient rehabilitation facilities nationwide is probably not the right tool for hospitalists because of its length and the training required to administer it, Dr. Hoyer says.

“There are other, easier tools that are available or in development that may also serve a similar purpose,” he says. “The main point is that routine functional assessment is important in the hospital setting, and developing strategies to improve patient function is likely an important way to improve outcomes such as hospital readmissions.”

The documented role of socioeconomic status in determining readmissions also is addressed by legislation introduced by Rep. Jim Renacci (R-Ohio) and supported by both the Society of Hospital Medicine and the American Hospital Association. The Establishing Beneficiary Equity in the Hospital Readmission Program Act (HR-4188) would adjust HRRP readmissions penalties to reflect “certain socioeconomic and health factors that increase the patient’s risk of readmissions.”

Larry Beresford is a freelance writer in Alameda, Calif.

The role of nonclinical factors in shaping rates of rehospitalization has been explored in several recent studies—and targeted through new legislation endorsed by the Society of Hospital Medicine. A study in Health Affairs compared hospital performance on 30-day readmissions for the first three diagnoses included in penalty calculations for CMS’ Hospital Readmissions Reduction Program (HRRP) and found that adjusting for patients’ socioeconomic status significantly reduced the rates of variation in readmissions between hospitals across the state of Missouri.¹

For patients discharged between 2009 and 2012, analysis using a model enriched with census tract socioeconomic data found that the range of variation in readmissions between hospitals decreased to 1.8% from 6.5% for patients with acute myocardial infarction; to 7.4% from 14.0% for congestive heart failure; and to 3.7% from 7.4% for pneumonia, compared with rates unadjusted for these socioeconomic factors. Another study in the same journal by researchers at an urban teaching hospital found that patients living in high-poverty neighborhoods were 24% more likely to be readmitted to the hospital within 30 days, after adjusting for demographic and clinical characteristics.²

For a factor that may be more amenable to intervention by hospitalists, a standardized rehabilitation medicine test measuring patients’ ability to perform everyday tasks of living, such as the ability to move independently from bed to chair, wheelchair, or toilet was found to be a good predictor of readmissions.³ Few hospitals currently require assessment of their patients’ functional ability, notes the study’s lead author Erik Hoyer, MD, assistant professor in the department of physical medicine and rehabilitation at the Johns Hopkins University School of Medicine in Baltimore. But the score “is a direct reflection of the patient’s ability to heal [outside of the hospital].”

The Functional Independence Measure used in this study and in inpatient rehabilitation facilities nationwide is probably not the right tool for hospitalists because of its length and the training required to administer it, Dr. Hoyer says.

“There are other, easier tools that are available or in development that may also serve a similar purpose,” he says. “The main point is that routine functional assessment is important in the hospital setting, and developing strategies to improve patient function is likely an important way to improve outcomes such as hospital readmissions.”

The documented role of socioeconomic status in determining readmissions also is addressed by legislation introduced by Rep. Jim Renacci (R-Ohio) and supported by both the Society of Hospital Medicine and the American Hospital Association. The Establishing Beneficiary Equity in the Hospital Readmission Program Act (HR-4188) would adjust HRRP readmissions penalties to reflect “certain socioeconomic and health factors that increase the patient’s risk of readmissions.”

Larry Beresford is a freelance writer in Alameda, Calif.