Follow Up with Patients and Save Millions in Medicare - Who Knew?

by Tim Foley

Published April 12, 2009 @ 06:17PM PT

Health care reform has to be about more than just coverage – it has to be about costs and quality.  The latest study on rehospitalizations for Medicare patients published in the New England Journal of Medicine confirms that part of what makes health care so inefficient is paying for “more care rather than better care,” to steal OMB Director Peter Orszag’s phrase – even with our public coverage programs.   In the case of the study, which shows that a staggering 1 in 5 Medicare beneficiaries were rehospitalized within 30 days of their release, we’re once again hitting a familiar problem:  we compensate for volume not for value.

By the way, it’s a welcome surprise that I first found out about the study on the blog of the White House Budget Director (well, only sort of a surprise, given Orszag’s focus on the fiscal necessity of reducing costs and improving quality in health care.)  Rehospitalization is a costly phenomenon, accounting “or about $17.4 billion of the $102.6 billion in hospital payments from Medicare in 2004.”  It also inherently implies some defect in the care for these patients, especially since the study controlled for severity of illness, which would normally be the likeliest culprit.

The one factor that jumps out, even more so that the wide range of variance between different geographic regions, is lack of follow-up.  More than half of the readmittees did not have an outpatient visit in between their hospital stays, which is bizarre when you consider the conditions most likely to involve readmittance were things like heart failure, psychosis, vascular and cardiac surgery, and pulmonary disease.  Really?  They didn’t have a follow-up doctor visit after cardiac surgery or psychosis?  Sadly, it’s true.  Were there follow-up phone calls from the hospital?  Was the patient given a care transitions intervention to prepare them for treating their condition after they were released?  Didthe hospital follow-up with the patient’s primary care physician and/or transmit records?

In most cases, no.  Because the hospital is just not compensated to do that.

Bob Wachter on The Hospitalist blog explains:

“Up till now, this broader value incentive [to improve quality among Medicare beneficiaries] was focused, laser-like, on care delivered within the four walls of the hospital. Hospitals could do quite well managing length of stay and costs and (more recently) scoring well on their publicly reported quality measures and accreditation surveys. The closest the present system came to putting any skin in the post-discharge game was public reporting of the presence or absence of documentation of a discharge plan for adults with heart failure or kids with asthma.”

In short, all the payment incentives are to deliver quality care within the hospital, but minimally to making sure the patients are healthy once they leave.  As always, preventative measures are paid the worst or not at all, and we wind up with expensive rehospitalizations instead of the smaller costs of follow-up and primary care.  Although Orszag details the Administration’s plans to tackle this problem specifically, I can’t help but feel that we’re not getting at the root of the problem.  He writes:

“Under the Administration’s proposal, hospitals with high rates of readmission will be paid less if certain patients are re-admitted to the hospital within 30 days, beginning in 2012.  Our proposal would also bundle payments to hospitals to cover not just hospitalization, but also care from certain post-acute providers for the 30 days after hospitalization.”

Basically, a mix of carrots (bundle payments to incentivize doctors and hospitals to care for the patient post-incident, not just during the intervention) and sticks (cutting funding if a hospital has too high a rate of preventable readmissions.)  But there’s something truly missing – any incentive to involve the patient’s regular physician.  We know from the VA and the Mayo Clinic, as well as other practitioners of truly coordinated care or the medical home, that having a lead physician or coordinator is crucial to success.  We also know from other medical trials that hospitals will, if they can, try a more cost-effective solution (call centers for follow-ups, for instance) to keep more of that bundle payments rather than have it go to a PCP.  And we also know from many failed experiments that quality isn’t something you get on the cheap.  It’s something you get by involving a personal physician.

Luckily for us, we’ve discovered a major source of waste and inefficiency in Medicare.  Unluckily for us, the standard response – just bundle payments better – may also not yield the value we need.

(Photo credit:  ortizmj12 on Flickr.)