Too high readmission rates will cost local hospitals
By Teresa Auch Schultz firstname.lastname@example.org September 8, 2012 6:38PM
All the major hospitals in Lake and Porter counties will see some loss in their Medicare payments because their readmission rates aren’t below new federal level. The higher the rate of the cut, the further the hospital is from meeting the new rate:
Community Hospital, Munster
— 1 percent cut
Franciscan St. Margaret Health Hammond — 1 percent cut
Methodist Hospitals, Merrillville and Gary — 0.82 percent cut
St. Mary Medical Center , Hobart
— 0.78 percent cut
Franciscan St. Margaret Health Dyer
— 0.64 percent cut
St. Catherine Hospital, East Chicago
— 0.61 percent cut
Franciscan St. Anthony Health Crown Point — 0.55 percent cut
Porter Health System — 0.02 percent cut
Updated: October 10, 2012 6:24AM
A new federal regulation overseeing the number of patients who have to be readmitted to hospitals means that every major hospital in Lake and Porter counties is losing up to 1 percent of their Medicare funding.
The funding cuts range anywhere from just 0.02 percent, for Porter Health System, to the full 1 percent, for Community Hospital in Munster and Franciscan St. Margaret Health in Hammond.
The rule is part of the federal Affordable Health Care Act and is aimed at helping cut costs. Before, Medicare paid hospitals every time a patient was admitted, including any time they had to be readmitted after an initial stay.
“Hospitals actually have a financial incentive to readmit patients,” Sam Flint, associate director of the School of Public and Environmental Affairs at Indiana University Northwest.
That also increases the costs of health care by having to pay for more hospital admittances.
Now, federal regulations say hospitals must have their readmissions fall under a certain rate. Those that don’t are being penalized with the Medicare cuts, with the worst receiving the maximum 1 percent loss. The cuts will grow each year a hospital doesn’t meet the new rates, with a maximum of a 2 percent cut next year and a 3 percent cut in 2014.
The rule is also supposed to help patients, who should see a decrease in serious complications from their original admittance.
“The federal government wants to make sure hospitals are doing the job right the first time,” Flint said.
Giving patients tools is key
The new rule has hospitals working to figure out how to get their rates down.
Methodist Hospitals, which includes the Northlake campus in Gary and the Southlake campus in Merrillville, is losing 0.82 percent of its funding. Chief Financial Officer Matthew Doyle said the system is taking steps to reduce the readmittance rate and has already seen it drop 5 percent in the last six months.
One of the main areas of focus has been on patients with chronic conditions, such as diabetes, dialysis or heart problems, because they are the ones most likely to have to be readmitted.
With these patients, Doyle said, the hospital is working on staying in touch with the patients once they leave the hospital and giving them tools they can use to monitor their health. For instance, he said, Methodist’s foundation has bought scales to give to heart patients when they leave. The patients can then track their weight to see if they have a slight increase. A 2- to 3-pound weight gain can mean they’re retaining water, which if isn’t caught in time could send them to an emergency room.
However, if the patients and a doctor catch it in time, the condition can possibly be treated at a doctor’s office instead of the hospital, saving the patient money.
“There are signs we know that lead to readmission,” he said. “So we help the patient deal with it before they need to go to the hospital.”
Methodist has also created its own team to look at other changes the hospital system can make and is taking part in national and state projects to find the best practices for tackling the issue. One of its employees also chairs the Northwest Indiana Patient Safety Coalition, which has started to look at this issue.
Franciscan Alliance, which includes St. Margaret in Hammond, St. Margaret in Dyer and St. Anthony in Crown Point, is taking a similar path, Chris Vanni, regional manager of performance improvement, said in an email.
Vanni said readmissions can be hard to address, because so many factors happen outside of the hospital. The hospital is focusing on addressing that issue by calling patients at their home after they leave the hospital, she said.
“We can ask them things like, ‘How are you feeling today?’ and ‘Have you taken your prescribed medication today?’ and then attempt to assist the patient with any negative answers that we may come across to avoid rehospitalization,” she said.
The Franciscan hospitals are also taking part in national groups to learn what are the best ways to bring rates down, Vanni said.
Vanni and Doyle both said their hospitals’ goal is to reduce readmissions by 20 percent. Vanni said the Franciscan hospitals hope to do so by the end of next year.
Northwest Indiana hospitals aren’t alone in missing the new federal guidelines. Flint said about two-thirds of the country’s hospitals are seeing some kind of funding cut because their readmission rates aren’t low enough. However, just 8 percent of hospitals will see the maximum 1 percent loss. The fact that two hospitals in Northwest Indiana are seeing the maximum cut is concerning, he said, as is the fact that 100 percent of the hospitals in the region are getting some kind of cut, instead of the national average of two-thirds.
“To be in that maximum penalty group, that’s not very good,” Flint said, although he also said an entire hospital should not be judged on this one area.
Flint said the new rule will force hospitals to start taking a bigger picture approach to treating patients, instead of just focusing on the immediate problem.
“It’s really a wake-up call to management,” Flint said. “Why are people being readmitted? Are you doing enough to make sure there are sources at home?”
Although hospitals can take steps while the patient is still there, he said, part of the problem is also what happens once a patient leaves. Evidence shows this can be a bigger problem for hospitals that serve a large number of people living in or near poverty.
Flint said hospitals need to start talking to patients and their families about their home life to see if perhaps help is needed or if the patient would be best served by another day in the hospital.
Evidence shows that by taking these and other steps to improve care, hospitals will cut down on the costs of health care for everyone, Flint said.
Overall, Doyle said, the cut in funding is more of a nudge than a real concern. However, Methodist is committed to reducing its readmission rates because it’s in the best interest of patients.
“I do believe at the end of the day it’s the right way to handle our patients because they’ll be seen at the right level of care,” he said.