Hospitals face $1.6 billion in penalties, survey says

NEW YORK – As they work to curb readmission rates and shift toward value-based reimbursement, hospitals are being slapped with big penalties that experts say are only increasing. A recent study from CipherHealth shows a mounting $1.6 billion in HCAHPS and readmission penalties facing hospitals today.

The survey calculated that at more than five hundred hospitals nationwide, three-year at-risk amounts were $3,500 per inpatient bed, a number experts say could provide clarity and prioritizing strategies for the healthcare industry. 

Value-based purchasing and readmission penalties for hospitals seek to align incentives around patient care, tying the successful recovery of a patient and that patient’s perception of the quality of the hospital to Medicare and Medicaid reimbursements. With 39 percent of hospitals running at a loss in 2011, even a small change to these reimbursement rates can lead to huge changes in staffing models at hospitals and ultimately the quality of patient care they are able to provide.

The CipherHealth study analyzed how this legislation would affect acute care hospitals, specifically. Using data from the American Hospital Association, Kaiser Family Foundation and CipherVoice patient surveys, the report found some surprising results.

In states such as West Virginia, the statewide risk is quite low, ranking 32nd when compared to the rest of the nation on three-year at-risk totals for readmissions and HCAHPS. However, at $3,600, the average amount at risk per bed in West Virginia is among the highest state averages in the country.

“The risk per bed view is a much more effective way to look at the data. Thinking of penalties on a per-bed basis helps hospitals to prioritize the dozens of different pieces of legislation and focus on what will create the most value for their organization,” says Zachary Silverzweig, one of the founders of CipherHealth. “It’s why we we’re able to establish such a strong presence in West Virginia. We quickly realized there was a serious pain point and we were well-positioned to deliver a solution to help hospitals avoid these penalties.”

In some states, however, the story is almost the exact opposite. California ranks second in terms of total at risk amount, yet ranks 30th when viewed on a risk-per-bed basis. Texas ranks fifth at the aggregate level, but on a per-bed basis, it ranks 32nd. However, when looking at the data for California and Texas at the health system level, there is wide variation.

Tenet Healthcare, which has a presence in 11 states, has an amount at risk per bed of $2,203 overall, but for its Texas facilities, amount at risk per bed is $1,481. Other health systems such as East Texas Medical Center have a much higher amount at risk per bed at $4,370.

The analysis also offers insights that defy geographic and demographic trends: North Dakota has a 70 percent higher per-bed risk than South Dakota and Mississippi has 51 percent higher average per-bed risk than neighboring Alabama.

With hospital executives facing everything from RAC audits to value-based purchasing to meaningful use to ICD-10, it is critical to be able to prioritize the various hospital initiatives and focus on key projects that can drive both short and long-term ROI, the study's authors note.

ONC targets Rx drug abuse with new data initiative

WASHINGTON – The Office of the National Coordinator for Health IT has launched a pilot program to make existing prescription drug use data available to healthcare providers and pharmacists when they treat patients during office visits and in emergency departments.

The test projects in Indiana and Ohio will measure the effectiveness of expanding and improving access to prescription drug monitoring programs (PDMPs) as part of the administration’s efforts to reduce prescription drug abuse.

The monitoring programs are statewide electronic databases, which are designed as a tool for providers to identify and intervene in cases of potential prescription drug abuse. The databases collect, monitor and analyze electronically transmitted prescribing and dispensing data submitted by pharmacies and dispensing practitioners.

The idea is that by improving real-time access to the information it will encourage providers to use the program more than it is now. So far, 49 states have legislation authorizing prescription drug monitoring programs or have active programs.

“The PDMP pilot projects will help hospital staff identify a patient’s controlled substance history at the point of care to enable better targeting of appropriate treatments and reduce the potential of an overdose or even death,” said Farzad Mostashari, MD, national coordinator for health IT. “We are not creating new systems; we are adding value to those that exist,” he added.

In Indiana, emergency department staff will be able to receive a patient’s controlled substance prescription history directly through the Regenstrief Medical Record System (RMRS), a care management system used by Wishard Health Services, a community health system in Indianapolis, and other hospitals.

The project is a collaboration of ONC, Regenstrief, Wishard, the National Association of Boards of Pharmacy, Appriss Inc., and the State of Indiana. In some states, Emergency departments are responsible for almost 25 percent of all controlled substance prescriptions.

The Ohio pilot will test having a drug risk indicator in the electronic health record (EHR) and how that affects clinical decision making. The Ohio project is a collaboration with the Springfield Center for Family Medicine, Eagle Software Corporation’s NARxCHECK, the State of Ohio, and MITRE.

The hope is that the pilots will improve real-time data sharing among providers, increase interoperability of data among states, and expand the number of people using these tools, according to Gil Kerlikowske, director of National Drug Control Policy.

The Enhancing Access to PDMPs Project stems from joint efforts of public sector and private industry experts that participated in the White House Roundtable on Health IT and Prescription Drug Abuse last year and the subsequent action plan (PDF).

The Centers for Disease Control and Prevention has said that the United States is in the midst of an epidemic of prescription drug overdose deaths, which outnumber deaths from heroin and cocaine combined.