CT Lawmakers Hear Pros & Cons of For-Profit vs. Nonprofit Hospitals

At this year’s legislative session, Connecticut lawmakers discussed a bill that would make it easier for private, for-profit hospital companies to purchase physician practices from a nonprofit hospital that it planned to take over.  Lawmakers have been wary of for-profit hospitals and what they could mean to the state, considering the fact that Connecticut currently only has one for-profit hospital.  The main concern regarding these hospitals is figuring out if quality of care would be compromised in favor of savings for shareholders.

Some industry experts cite a long list of complaints, fines and legal settlements that have arisen from some of these for-profit hospitals.  But, proponents of for-profit hospitals state they have made changes to their companies and that most hospitals in the state looking to be acquired feel comfortable to move forward.

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Medicare Looks to Cut Spending on Post-Acute Care

Researchers have discovered huge discrepancies in how much Medicare spends on nursing homes, home health services, and other post-acute services around the country.  For example, in Louisiana, Medicare spends $8,800 per patient for home health care as opposed to $3,300 per patient in New Jersey.  Because of discrepancies like these, Medicare is seeking to gain more control over what it spends on services patients receive after leaving the hospital.

Medicare spent $62 billion last year- one out of every six dollars on traditional fee-for-service programs.  Experts agree that this “hodgepodge of payment methods” encourage “unnecessary and disjointed” care which wastes taxpayer money and makes fraud easier.  They also agree that hospitals usually don’t take costs into account when discharging patients.

Medicare is now experimenting with new payment methods such as bundled payments where hospitals and post acute providers work together to treat patients for a fixed sum (rather than getting paid for each service). Also, President Obama has proposed reducing payments for certain conditions to post-acute providers and paying the same rates for similar patients. Experts warn that the transition to a new payment method will not be an easy one.

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CT Attorney General Wants Hospitals to Disclose ‘Facility Fee’

Many patients have been surprised to see a “facility fee” on top of charges for in-office services and procedures provided to them by practices. Connecticut Attorney General George Jepsen has asked the state’s hospitals for a list of their affiliated providers by December 6 after receiving numerous complaints from consumers who were not informed about the fees. A “facility fee” is what hospitals say they have to charge patients of practices they have acquired because acquiring an independent practice increases their overall costs. Jepsen wants a list for patients so that they have the option of going somewhere else if they don’t want to be charged a fee which is a separate and sometimes expensive fee.

Emerging trends in Connecticut and throughout the country point towards heavy healthcare industry consolidation where hospitals are merging with other hospitals and acquiring medical practices. Jepsen notes that it’s especially important for consumers to understand this shift and the associated costs.

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Higher Nursing Staff Levels Linked to Lower Medicare Readmission Penalties

A new study focused on Medicare patient readmissions finds that hospitals with high nursing staff levels had a 25% lower chance of being penalized than hospitals with lower nurse-staffing ratios.  The higher-nurse staffed hospitals also had a 41% lower chance of receiving the maximum penalty for readmissions.  The study, published in this month’s Health Affairs, looked at nursing staff levels and readmission a data from 2,826 hospitals; researchers estimated that each additional nurse hour per patient brought 10% lower odds of receiving penalties from the Hospital Readmissions Program, the federal program initiated last year to reduce Medicare spending on preventable readmissions.

Nurses are responsible for many activities which may reduce admissions including coordinating care, overseeing care in the hospital, planning a patient’s hospital discharge, and educating patients and their families about follow up care.

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Connecticut Judge Dismisses Observation Care Lawsuit

On Monday, a federal judge in Hartford, Connecticut dismissed a lawsuit which was filed by 14 Medicare beneficiaries seeking nursing home coverage.  The Medicare beneficiaries, who stayed in nursing homes following a hospital stay, had to pay tens of thousands of dollars in nursing home bills because they stayed in the hospital under observation status.  Under current Medicare rules, patients must be admitted to a hospital for at least three consecutive days to be eligible for follow up coverage in a nursing home.  The primary goal of the lawsuit was to change the observation classification for Medicare beneficiaries.  Medicare beneficiaries staying in hospitals under observation status has increased by almost 70 percent in five years, while admissions under the inpatient status have decreased.

The lawsuit is timely considering CMS finalized the “2-midnight rule” which aims to change Medicare beneficiaries’ status as inpatients.  The new rule, according to CMS, “improves value and quality in hospital care and provides clarification about when a patient should be admitted to the hospital and responds to recent concerns about extended Medicare beneficiary stays in the hospital outpatient department” (click here to read more about the rule).

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Slow-Nurse Market Widespread

Due to economic downturn and health care reform, the job outlook for nurses is radically changing in latest years, especially in Connecticut.  Many hospitals have laid off nurses or implemented a hiring freeze. Gov. Malloy has already cut more than $500 million from the current fiscal budget for hospitals. While both Medicaid and Medicare do not pay the full cost of a patient’s care, hospitals are no longer being reimbursed for patients re-admitted to the hospital within 30 days of discharge.

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What The Doctor Ordered

Two New York City hospitals are joining a nationwide program that allows doctors to prescribe fruits and vegetables to high-risk, low-income patients. “Health Bucks” are worth $2 for each family member and can be used to purchase goods at farmers markets once a week.  Wholesome Wave, a Connecticut-based organization initiated the health program which has been modeled in eight other states.

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