Medicare, swing beds, and critical access hospitals.

Critical Access Hospitals (CAHs) receive cost-based reimbursement from Medicare for inpatient care, including post-acute skilled care provided in swing beds (skilled swing days). Because the reimbursement formula treats swing bed and acute days equally, there is concern that CAH skilled swing days are "overreimbursed" as compared with skilled days provided in other settings. The reimbursement formula is complex; thus, empirical estimates are needed to identify the marginal cost per day to the hospital and the implied Medicare expenditure per day, accounting for fixed cost transfers between services. Using Medicare cost report data, we find that Medicare paid, on average, $581 for the routine portion of a CAH skilled swing day in 2009--more than the estimated marginal cost of $262, but less than the 2009 average per diem of $1,302. Estimates varied widely across the 1,300 CAHs; therefore, payment policy changes would likely have a broad range of effects.

Financial consequences of rural hospital long-term care strategies.

Data for 540 rural hospitals from 1982 to 1997 were analyzed to determine whether adoption of long-term-care (LTC) strategies improved hospital financial performance. Adoption of external and internal LTC strategies (other than swing-beds) was generally, but not unambiguously, associated with higher profits, increased occupancy, and/or lower costs.

[The management control system of the Roma/C Local Health Authority. Financial year 2004]. / Il sistema di controllo di gestione dell'Azienda USL Roma/C. Esercizio 2004.

The aim of this study was to describe the budgeting process of the Roma/C Local Health Authority during the 2004 financial year. The planning-control process, which included preparing regular reports, allowed performing comparisons between actual with planned results so that the necessary corrective actions could be taken in a timely manner. It also led to a confrontation between the various managers involved, regarding: 1. the conversion of ordinary regime hospital beds into day hospital beds; 2. the development of a new model of emergency care aimed at integrating care between the hospital and the community; 3. the need to implement dataware housing.

Linkages in the rural continuum: the balanced budget act and beyond.

PURPOSE: This study examined how rural hospitals altered their postacute and long-term care strategies after the Balanced Budget Act of 1997 (BBA97). DESIGN AND METHODS: A nationally representative sample of 540 rural hospital discharge planners were interviewed in 1997. In the year 2000, 513 of 540 discharge planners were reinterviewed. The study is a descriptive analysis of how rural hospitals formed new and altered existing organizational strategies during a time of turbulent changes in federal government reimbursement policy. We classify rural hospital strategic behavior in 1997 according to the Miles and Snow typology of Prospectors, Analyzers, Defenders, and Reactors, and then we examine how the various hospital types altered key strategies following BBA97. RESULTS: Between 1997 and 2000, more than 26% of sampled rural hospitals that did not participate in the swing-bed program in 1997 (44/167) had chosen to do so in 2000, whereas only 3% of those using swing beds in 1997 had eliminated them (12/346). Other strategies such as divestiture of hospital-based nursing homes were related to concurrent swing-bed adoption. Rural hospitals also increased their reliance on formal linkages with external providers of long-term care. IMPLICATIONS: After the BBA97 reimbursement changes, rural hospitals increased their reliance on swing beds and formal linkages to external providers. We observed changes in overall strategy types, away from the Defender and toward the Prospector and Analyzer strategy types. Our findings illustrate the importance of swing beds as a critical buffer for rural hospitals challenged by the uncertainty of the post-BBA97 environment.

Strategies for cutting hospital beds: the impact on patient service.

OBJECTIVE: To develop insights on the impact of size, average length of stay, variability, and organization of clinical services on the relationship between occupancy rates and delays for beds. DATA SOURCES: The primary data source was Beth Israel Deaconess Medical Center in Boston. Secondary data were obtained from the United Hospital Fund of New York reflecting data from about 150 hospitals. STUDY DESIGN: Data from Beth Israel Deaconess on discharges and length of stay were analyzed and fit into appropriate queueing models to generate tables and graphs illustrating the relationship between the variables mentioned above and the relationship between occupancy levels and delays. In addition, specific issues of current concern to hospital administrators were analyzed, including the impact of consolidation of clinical services and utilizing hospital beds uniformly across seven days a week rather than five. PRINCIPAL FINDINGS: Using target occupancy levels as the primary determinant of bed capacity is inadequate and may lead to excessive delays for beds. Also, attempts to reduce hospital beds by consolidation of different clinical services into single nursing units may be counterproductive. CONCLUSIONS: More sophisticated methodologies are needed to support decisions that involve bed capacity and organization in order to understand the impact on patient service.

Emergency department observation unit: can it be funded through reduced inpatient admission?

STUDY OBJECTIVE: We sought to test the assumption that an emergency department observation unit can be funded through the reallocation of resources made available through the unit's impact in reducing inpatient admissions and facilitating bed closures. METHODS: We conducted our study in a tertiary care center ED with 46,000 visits annually. For a 3-month period, all patients admitted to the hospital through the ED were screened by an emergency physician for suitability for admission to an observation unit. Any patient in the hospital for 3 days or less who did not undergo surgery or other inpatient procedure, and who was admitted through the ED, was considered a candidate for the observation unit. RESULTS: Of 1,840 admissions, 147 patients met the admission criteria. Only 48 (32.2%) could have been treated in an observation unit, and these patients were not admitted to any single unit in high frequency. The potential savings from inpatient bed closures would only have amounted to 1.68 full-time equivalents-not enough to staff a 4-bed observation unit, which would require 5 full-time equivalents. CONCLUSION: Because of the diffuse and inconsistent effect such a unit had on inpatient bed use, funding for an ED observation unit at our institution could not be justified on the basis of the closure of inpatient beds and transfer of resources.

Medicare and Medicaid Programs; new payment methodology for routine extended care services provided in a swing-bed hospital; correction--HCFA. Correction notice.

This document corrects the final rule published October 3, 1996 (61 FR 51611) that revised the methodology for payment of routine extended care services furnished in a swing-bed hospital. The final rule also revised the regulations concerning the method used to allocate hospital general routine inpatient service costs for purpose of determining payments to swing-bed hospitals.

Medicare and Medicaid Programs; new payment methodology for routine extended care services provided in a swing-bed hospital--HCFA.

The final rule revises the regulations governing the methodology for payment of routine extended care services furnished in a swing-bed hospital. Medicare payment for these services is determined based on the average rate per patient day paid by Medicare for these same services provided in freestanding skilled nursing facilities (SNFs) in the region in which the hospital is located. The reasonable cost for these services is the higher of the reasonable cost rates in effect for the current calendar year or for the previous calendar year. In addition, this final rule revises the regulations concerning the method used to allocate hospital general routine inpatient service costs for purposes of determining payments to swing-bed hospitals. These changes are necessary to conform the regulations to section 1883 of the Social Security Act (the Act), and section 4008(j) of the Omnibus Budget Reconciliation Act of 1990.

Is subacute care feasible?

As healthcare executives attempt to control costs and enhance revenue in an increasingly competitive market, many are considering converting acute care units into subacute care units (Medicare-certified skilled nursing units). Such a conversion can help control costs by providing care in a less expensive setting that is appropriate for patients who require less intensive care than traditional acute care. In addition, converting an acute care unit into a subacute care unit can optimize reimbursement for Medicare patients. A detailed feasibility analysis that addresses clinical, regulatory, space, and financial considerations should be conducted before healthcare executives decide to convert acute care beds into subacute care beds. Only after a feasibility analysis is performed can healthcare executives determine whether creating a subacute care unit is a realistic, beneficial option.

Managing financial pressures with subacute care.

Many healthcare organizations have found that converting acute care beds to subacute care beds has enabled them to control costs, enhance payments, and better serve patients along the full continuum of care. Conversion to subacute care, however, requires careful planning and sufficient resources. Healthcare executives contemplating converting an acute care unit to a subacute care unit must determine the cost of conversion, the types of services to be offered, licensing requirements, the types of patients to be served, and reimbursement implications.

Case study: assessing laparoscopic cholecystectomy. The GVHS experience.

This article describes the experience at the Greater Victoria Hospital Society of assessing the appropriateness of introducing laparoscopic cholecystectomy (lap chole) within the framework of an established technology assessment process. Lap chole promised to deliver cost savings; however, these could only be realized by capitalizing on the reduced length of stay by removing the surgical beds from service. A cautionary note is raised as to whether the increased use of lap chole in the population is appropriate.

Financial advantages of operating a skilled nursing unit.

Hospitals may accrue specific financial advantages from the operations of a skilled nursing unit (SNU), such as the ability to allocate some fixed costs to a hospital-based unit that receives cost-based reimbursement from Medicare. The level of reimbursement SNUs receive from Medicare, however, can be optimized by obtaining an exemption or an exception to routine cost limits.

Subacute care as a new source of revenue.

Subacute rehabilitation is a segment of subacute care that offers potential financial rewards for providers while offering needed care to rehabilitation patients who would qualify for subacute care. It is also a logical level of care for acute care providers and/or rehabilitation providers to implement. While a subacute rehabilitation unit definitely can be a more financially attractive opportunity than a traditional skilled nursing unit, success in such a venture requires an in-depth understanding of the structure of such units and of reimbursement for skilled nursing care.