Sunday, September 16, 2012

Out-of-the-Box Thinking on Avoiding Hospital Readmissions

As a cardiac electrophysiologist, I'm pretty far removed from public policy.  But I have to admit that I was interested in the latest move by CMS to cut their Medicare payment rates to hospitals by invoking pay cuts for hospital readmissions.  The Chicago Tribune's article is enlightening and filled with some interesting anecdotes after the first round of pay cuts were implemented:

(1) The vast majority of Illinois hospitals were penalized (112 of 128)
(2)  Heart failure, heart attack, and pneumonia patients were targeted first because they are viewed as "obvious."
(3) "A lot of places have put a lot of work and not seen improvement," said Dr. Kenneth Sands, senior vice president for quality at Beth Israel.
(4) Even the nation's #1 Best Hospital (according to US News and World Report) lost out.

So what's a hospital to do?

I have a suggestion based on other observations in regard to government-imposed pay-for-performance measures that have cost hospitals and clinics across the land untold billions to implement and still have failed to demonstrate even a break-even financial proposition for hospitals.

Stop trying.

From the looks of things, Medicare's going to cut even the finest hospital's pay.  Everyone will suffer, just some more immediately than others, but woe to the hospital that works to understand why.  This is not the intent of this measure.  The intent of this measure is to cut payments.

Therefore, if we do not commit excessive funds to this endeavor and instead work to support the people on the front lines as they do their job, cost savings will more likely be realized than if 500 more administrators and nurse coordinators are put on the job.  Like putting cash under your mattress in a down market, they'll be way ahead.

Hiring more people are expensive because of their salaries and benefits.  Writing programs to do this is also expensive.  All kinds of people are expensive because of the training they require for new government initiatives like Pay for Performance (which has NOT been shown to affect outcomes by the way) and avoidance of hospital readmissions (little proof of sustainable goals can be achieved, a la quote #3 above).

So just help the professional people you already have do their jobs caring for patients to the best of their ability.  Make this the mantra rather than new unproven approaches. 

Call me silly, but my bet is that hospitals would do WAY better off financially in the long run if they stopped trying so hard to follow unproven legislative initiatives.



Anonymous said...

I share your frustration with the bureaucracies that have been built and continue to metastasize.

However, the AHA (American Hospital Association) has seen consistent 3% raises over the last 20 years while the docs who lack the lobbying power have been cut to the point that we no longer own our practices. The hospital now owns my practice. Thankfully, our CEO is a benign dictator but I fear that consolidation will eventually leave me with with a CEO less reasonable.

While I make no excuses for CMS, they must cut reimbursement for everyone. This country is BK. Congress just cannot say no to the AHA. This justification of 'value based purchasing', 'pay for performance', etc. is providing cover for the cuts in growth. It will be shocking if any hospital revenue actually shrinks. The sea of acronyms disguises a means to slow the growth of medical spending.

Unknown said...

Dear Wes,

I am a prospective medical student who has been researching policy at the Harvard School of Public Health. My research group has been critical of CMS' readmission policy ( for many of the reasons you outlined: the readmission metric does not seem to measure what policymakers think it measures, and the penalties seem to impact a lot of very good hospitals, as well as a hospitals that care for the poor.

In CMS' defense, I do not get the sense that the readmission penalty is meant to be a "pay cut" as you suggest, but rather a well-intentioned effort (misguided as it may be) to force providers to reduce wasteful care. And the finances of healthcare in America are so dire that there is virtual agreement that some policy changes are going to be necessary to force hospitals to be more efficient - leaving providers alone is not going to work. The fact of the matter is that regardless of how one feels about the readmission penalty, the penalties are not trivial (up to 1% of Medicare reimbursements currently, and in a few years it will be up to 3% of reimbursements). And contrary to Dr. Kenneth Sands' quote about improvements in readmission, the data we have looked at seems to suggest that it is possible for a hospital to improve their readmission rate.

In the end, I think most hospital administrators are following your implicit suggestion, which is to weigh the cost of an initiative to improve their readmission rate against the penalty. The best course of action likely varies across hospitals, and perhaps there will be hospitals that choose not to do anything about their readmission rates. But I hardly think that "stop trying" is the right strategy for all or even most hospitals.


Anonymous said...

I'm interested to learn that you don't think pay for performance works.

I wonder if your assessment also applies to public schools?

DrWes said...

Sid -

I do not get the sense that the readmission penalty is meant to be a "pay cut" as you suggest, but rather a well-intentioned effort (misguided as it may be) to force providers to reduce wasteful care.

I am glad to learn of your interest on readmission rates for hospitals. Sadly, I could not break the Harvard firewall before reading your reference cited. Glad you see some of my concerns.

But I have yet to meet a doctor who wants the patient he's worked on so hard to return to the hospital. We are not in the business to make revolving doors to hospitals. We are in the job of health care and health care, believe it or not, is anything but linear or logical.

I have no doubt in my mind that the legislation as written was "well-intentioned" but the road to hell was paved by "good intentions." These ideas proposed by grand thinkers and policy wonks who have never spend a day in the Emergency Room have no comprehention of the myriad of variables that doctors encounter daily in our practices that are completely out of our control: poverty, poor education, family influences, social norms, etc. To these thinkers, there's is a perfect world. But reality is much different.

Take, for instance, "heart failure." First, heart failure is a symptom, not a disease. As such "heart failure" comes with many other problems beyond the heart: renal disease, pulmonary disease, sometimes arthritis, etc., any ONE of which could result in a readmission unrelated to the initial episode of heart failure. Seriously, who are we kidding?

You "suggest" it is "possible" for hospitals to improve their readmission rates. But at what cost? How many administrative hires, meetings, computer programs, spreadsheets, data collections and chart reviews will it take to prove savings? How much do all these things cost? Do they add benefit to patients or detract from time caregivers can spend with them? And what about the same program in different cities, hospitals, or care settings? Suddenly, the answer is not so obvious.

If we stop focusing on patients and instead turn our focus to collections, patients lose. Yes we need to be more efficient and thoughtful. But why not ask those on the ground how to do things better than dreaming up ridiculous algorithm that makes a mockery of the cost cuts that must be implemented?

Anonymous said...

As a pharmacist, I think readmission rates might possibly be affected by accurate medication reconciliation at discharge, tying up loose ends before leaving the confines of the building. It's been my observation that measures for accurate dismissal prescriptions and instruction can be inconsistent as patients might be transferred, be discharged on a moment's notice, and incomplete information sometimes for the next healthcare facility transfer of information, especially if large teaching hospitals are involved.

Andrew_M_Garland said...

(Some sarcastic and ignorant observations from a non-medical person.)

Usually, HHS hates the free market, and directs medical care and reimbursement in detail. They reason that if you are smart enough to invent better treatment, then you are smart enough to cheat HHS. So, no deviations from recommended treatment are tolerated. It could be a scam.

But, HHS also trusts the free market, trusts that hospitals will find a way to save money while delivering the same excellent care, by appealing to the crass nature of doctors and hospitals to do anything for money. They are sure doctors can do better. All they have to do is threaten their income. I wonder how far they can go with that.

I suggest that each hospital do readmission triage: Unlikely, Maybe, Probably.

Maybe and Probably: Schedule a readmission for 28 days, and cancel it if not needed. If they are readmitted at any time, mark it as expected, so not subject to the readmission limits. Explanation: We knew they would be readmitted as part of their treatment. It was clearly cheaper to let them walk around for a few days than remain in an expensive hospital bed or hallway until they relapsed.

For Unlikely: I suggest that hospitals partner with each other, so that no one is readmitted to the same hospital within 30 days. They have to go to some other hospital. With electronic medical records, it would be easy to transmit the patient history to the cooperating hospital, and the patient would automatically get a second opinion.

Medical costs would go up with all the extra paperwork, but it is better than losing 1-3% in revenue.

Sorry to say, if patients are readmitted because they still have an IV or catheter inserted, hospitals will have to take the hit.

michael said...

Dr Wes:
I understand your argument but don't agree with some of your assumptions.
There are inexpensive solutions for contacting patients ($50.00 per month, per patient) that can be easily cost justifed against the redmission penalty.
The call paths can be directed for specific conditions and can be done with adding staff time and labor.
Ive worked with North Shore and consider them a top notch organization and would like to share the research Ive done if you're interested.