Long-term care hospitals also had a higher incidence of bedsores and infections than regular hospitals in 2006, the most recent year for which federal data is available.
Fewer than 10 hospitals dedicated to long-term care existed in the early 1980s, according to Medicare officials. But many such hospitals have sprouted since then, driven by Medicare rules that offer high payments for hospitals that treat patients for an average of 25 days or more. Long-term care hospitals now treat about 200,000 patients a year, including 130,000 Medicare patients — at a projected cost of $4.8 billion to the government this year, up from $400 million in 1993.
Unlike other specialized hospitals, like psychiatric or children’s hospitals, long-term care hospitals do not treat specific types of patients or offer services unavailable in regular hospitals. They are defined solely by the fact that they keep patients longer than other hospitals. They are also smaller than a typical hospital, averaging about 60 beds.
Many patients at hospitals that specialize in long-term care are very sick. While usually in stable condition, they may be on dialysis, need a ventilator or have wounds that will not heal. If patients need surgery or suffer serious medical emergencies, they are usually transferred back to general hospitals.
Nontraditional Hospitals
Despite the rapid expansion of long-term care hospitals and the serious illnesses they treat, Medicare has never closely examined their care. Unlike traditional hospitals, Medicare does not penalize them financially if they fail to submit quality data.
Supporters of long-term hospitals say that even without staff physicians, they provide high-quality care and play an important role by treating patients who are too sick for nursing homes but are not improving at traditional hospitals. Hospital intensive care units help patients survive acute illnesses, heart attacks and trauma, but they are not intended to treat patients for weeks or months.
Of course, traditional hospitals can move those patients to regular medical wards for treatment. But under Medicare payment rules, traditional hospitals often lose money on patients who stay for long periods. So they have a financial incentive to discharge patients to long-term hospitals, which then receive new Medicare payments for admitting the patients. Both hospitals benefit financially.
That dynamic, rather than evidence that long-term hospitals benefit patients, has driven their expansion, said Dr. Jeremy M. Kahn of the University of Pennsylvania, who has received a federal grant to study the hospitals. The industry’s growth is an example of how health care companies can exploit the $450 billion Medicare program, he added.
“The U.S. health care system allows unintentional financial incentives to drive sweeping changes,” Dr. Kahn said.
The questions about long-term care hospitals center on the for-profit side of the industry, led by Select and Kindred Healthcare, another publicly traded company.
For-profit long-term hospitals generally spend less on patients and have higher margins than comparable nonprofits, according to data from the Medicare Payment Advisory Commission, a Congressional research agency.
In 2007, for-profit long-term care hospitals had margins of 6 percent on Medicare patients, while regular hospitals lost an average of 6 percent on Medicare patients, according to the commission.
In a presentation to investors last month, Select Medical reported that it improved its margins by monitoring staffing levels and lowering supply costs.
Medicare inspection reports, however, describe preventable patient injuries and deaths, and they portray Select’s hospitals as understaffed and with high turnover.
In the last three years, inspectors have found 22 violations of care standards at 12 Select hospitals so serious that, if uncorrected, could lead Medicare to ban those hospitals from admitting Medicare patients.
Howard McGowan
MaldenSenior
Saturday, December 17, 2011
Tuesday, December 13, 2011
Major For-Profit Nursing Home Chains Skimp on Care Quality,
Study Shows
Alyssa Gerace | December 12, 2011 | Comments (0)
The top ten for-profit nursing home chains in the United States provide a lesser quality of care to their patients, partially due to fewer nursing staffing hours, according to a recent study published in Health Services Research.
Nurse “staffing hours” in the largest for-profit chains were 30% lower than those in non-profit and government nursing homes between 2003 and 2008. At the same time, the for-profits had the sickest residents, and maintained total nursing staff levels significantly lower than 2008′s national average of 3.77.
“Nurse staffing levels have been documented to have a positive impact on both the process and the outcomes of nursing home care,” report the study’s authors.
Although the staffing levels were low in comparison to non-profit and government facilities, they were still higher than other for-profit chains and for-profit nonchains, the study found.
However, when compared to top-rated nursing homes, the top-ten chains were cited for 41% more serious deficiencies and 36% more deficiencies overall. The average number of total and serious deficiencies was “significantly higher than in any other ownership group,” although other for-profit chains and nonchains also had higher deficiencies than government facilities.
“Facility size and the percent Medicaid residents were positively associated with total deficiencies and serious deficiencies,” said the study.
This is the first study that looks at staffing in conjunction with quality of care in the largest for-profit chains, and the results show that there’s a relationship between ownership, low staffing and higher deficiencies, the study’s authors concluded.
“The study does provide evidence of the need for more study of quality of care in the largest for-profit chains and in chains purchased by private equity firms, because they are under pressure to improve shareholder and investor values, with little oversight by regulators,” they said.
The full article, “Nurse Staffing and Deficiencies in the Largest For-Profit Nursing Home Chains and Chains Owned by Private Equity Companies,” can be accessed here.
Written by Alyssa Gerace
Alyssa Gerace | December 12, 2011 | Comments (0)
The top ten for-profit nursing home chains in the United States provide a lesser quality of care to their patients, partially due to fewer nursing staffing hours, according to a recent study published in Health Services Research.
Nurse “staffing hours” in the largest for-profit chains were 30% lower than those in non-profit and government nursing homes between 2003 and 2008. At the same time, the for-profits had the sickest residents, and maintained total nursing staff levels significantly lower than 2008′s national average of 3.77.
“Nurse staffing levels have been documented to have a positive impact on both the process and the outcomes of nursing home care,” report the study’s authors.
Although the staffing levels were low in comparison to non-profit and government facilities, they were still higher than other for-profit chains and for-profit nonchains, the study found.
However, when compared to top-rated nursing homes, the top-ten chains were cited for 41% more serious deficiencies and 36% more deficiencies overall. The average number of total and serious deficiencies was “significantly higher than in any other ownership group,” although other for-profit chains and nonchains also had higher deficiencies than government facilities.
“Facility size and the percent Medicaid residents were positively associated with total deficiencies and serious deficiencies,” said the study.
This is the first study that looks at staffing in conjunction with quality of care in the largest for-profit chains, and the results show that there’s a relationship between ownership, low staffing and higher deficiencies, the study’s authors concluded.
“The study does provide evidence of the need for more study of quality of care in the largest for-profit chains and in chains purchased by private equity firms, because they are under pressure to improve shareholder and investor values, with little oversight by regulators,” they said.
The full article, “Nurse Staffing and Deficiencies in the Largest For-Profit Nursing Home Chains and Chains Owned by Private Equity Companies,” can be accessed here.
Written by Alyssa Gerace
Monday, December 12, 2011
Nursing homes are on a track toward negative profit
Alyssa Gerace | December 11, 2011 | Comments (0)
if Congress passes certain end-of-the-year legislation, and it could affect the level of services that are offered, according to analysis by The Moran Company on behalf of the American Health Care Association (AHCA).
The analysts considered the impact of policy changes that include a “clawback” of 2011 revenues from RUG IV implentation, a two-year suspension of market basket adjustments, limiting bad debt payments to 25%, imposing a 5% coinsurance on the first 20 days of skilled nursing care, and capping Medicaid provider taxes at 3.5% of total payments.
Evaluating these policy changes “would turn nursing facility net margins from mildly positive to consistently negative over the forecast period,” the research shows.
If implemented, resultant industry margin revenue would be at 0.1% in 2012, which would dip to negative 2.9% the following year and still further in 2015 to -3.1%. By 2021, revenue margins would remain negative at -0.8%, according to The Moran Company’s data.
“While our analysis demonstrates the possibility that the industry might be able to weather reductions of this magnitude, it makes clear the substantial degree of uncertainty surrounding the industry’s ability to actually do so,” the analysis concluded.
Taking into account the expected 2% cuts to Medicare payments, as a result of deficit reduction activity, The Moran Company estimates that baseline overall margins will range from 0.64% of revenue in 2012 to 2.11% in 2021.
If these reimbursement reductions are implemented, the analysts said, the level of services now provided in nursing facilities could also be affected.
“Many may not want to mention margins when it relates to healthcare providers, but the fact of the matter is without a margin, it’s just not possible to keep operating,” said AHCA President and CEO Mark Parkinson in a statement.
The Moran Company’s findings, “Assessing the Financial Implications of Alternative Reimbursement Policies for Nursing Facilities,” can be viewed here.
Written by Alyssa Gerace
if Congress passes certain end-of-the-year legislation, and it could affect the level of services that are offered, according to analysis by The Moran Company on behalf of the American Health Care Association (AHCA).
The analysts considered the impact of policy changes that include a “clawback” of 2011 revenues from RUG IV implentation, a two-year suspension of market basket adjustments, limiting bad debt payments to 25%, imposing a 5% coinsurance on the first 20 days of skilled nursing care, and capping Medicaid provider taxes at 3.5% of total payments.
Evaluating these policy changes “would turn nursing facility net margins from mildly positive to consistently negative over the forecast period,” the research shows.
If implemented, resultant industry margin revenue would be at 0.1% in 2012, which would dip to negative 2.9% the following year and still further in 2015 to -3.1%. By 2021, revenue margins would remain negative at -0.8%, according to The Moran Company’s data.
“While our analysis demonstrates the possibility that the industry might be able to weather reductions of this magnitude, it makes clear the substantial degree of uncertainty surrounding the industry’s ability to actually do so,” the analysis concluded.
Taking into account the expected 2% cuts to Medicare payments, as a result of deficit reduction activity, The Moran Company estimates that baseline overall margins will range from 0.64% of revenue in 2012 to 2.11% in 2021.
If these reimbursement reductions are implemented, the analysts said, the level of services now provided in nursing facilities could also be affected.
“Many may not want to mention margins when it relates to healthcare providers, but the fact of the matter is without a margin, it’s just not possible to keep operating,” said AHCA President and CEO Mark Parkinson in a statement.
The Moran Company’s findings, “Assessing the Financial Implications of Alternative Reimbursement Policies for Nursing Facilities,” can be viewed here.
Written by Alyssa Gerace
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