Observation Care - High-Value Care or a Cost-Shifting Loophole?

Department of Emergency Medicine, Brigham and Women's Hospital, Boston, USA.
New England Journal of Medicine (Impact Factor: 55.87). 07/2013; 369(4):302-5. DOI: 10.1056/NEJMp1304493
Source: PubMed
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    • "Numerous studies have shown that many other conditions and complaints can also be effectively and efficiently managed in this setting [7,12-14]. The average cost savings of an OU stay is nearly $1,600 USD compared to an inpatient hospitalization [15,16]. Additionally, studies have shown equivalent clinical outcomes and even higher patient satisfaction versus inpatient admission [17,18]. "
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    ABSTRACT: To improve efficiency, emergency departments (EDs) use dedicated observation units (OUs) to manage patients who are unable to be discharged home, yet do not clearly require inpatient hospitalization. However, operational metrics and their ideal targets have not been created for this setting and patient population. Variation in these metrics across different countries has not previously been reported. This study aims to define and compare key operational characteristics between three ED OUs in the United States (US) and three ED OUs in Asia. This is a descriptive study of six tertiary-care hospitals, all of which are level 1 trauma centers and have OUs managed by ED staff. We collected data via various methods, including a standardized survey, direct observation, and interviews with unit leadership, and compared these data across continents. We define multiple key operational characteristics to compare between sites, including OU length of stay (LOS), OU discharge rate, and bed turnover rate. OU LOS in the US and Asian sites averaged 12.9 hours (95% CI, 8.3 to 17.5) and 20.5 hours (95% CI, -49.4 to 90.4), respectively (P = 0.39). OU discharge rates in the US and Asia averaged 84.3% (95% CI, 81.5 to 87.2) and 88.7% (95% CI, 81.5 to 95.8), respectively (P = 0.11), and the bed turnover rates in the US and Asian sites averaged 1.6 patients/bed/day (95% CI, -0.1 to 3.3) and 0.9 patient/bed/day (95% CI, -0.6 to 2.4), respectively (P = 0.27). Prior research has shown that the OU is a resource that can mitigate many of problems in the ED and hospital, while simultaneously improving patient care and satisfaction. We describe key operational characteristics that are relevant to all OUs, regardless of geography or healthcare system to monitor and maximize efficiency. Although measures of LOS and bed turnover varied widely between US and Asian sites, we did not find a statistically significant difference. Use of these metrics may enable hospitals to establish or revise an ED OU and reduce OU LOS, increase bed turnover, and discharge rates while simultaneously improving patient satisfaction and quality of care.
    International Journal of Emergency Medicine 02/2014; 7(1):6. DOI:10.1186/1865-1380-7-6
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    ABSTRACT: To the Editor: In their Perspective article, Baugh and Schuur (July 25 issue)(1) raise important concerns about Medicare beneficiaries who face high costs during observation stays. According to the authors, "observation billing exposes patients to increased cost sharing in several ways." However, since their article was published, our office has released a study indicating that, on average, Medicare beneficiaries pay less for observation stays than for inpatient stays.(2) We compared observation stays with short inpatient stays (1 night or less) and found that beneficiaries paid, on average, $324 less for observation stays. (When charges for self-administered drugs were included, beneficiaries . . .
    New England Journal of Medicine 10/2013; 369(15):1474-1475. DOI:10.1056/NEJMc1311059#SA1 · 55.87 Impact Factor
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    ABSTRACT: Patients are treated using observation services (OS) when their care needs exceed standard outpatient care (i.e., clinic or emergency department) but do not qualify for admission. Medicare and other private payers seek to limit this care setting to 48 hours. Healthcare Cost and Utilization Project data from 10 states and data collected from two additional states for 2009. Bivariate analyses and hierarchical linear modeling were used to examine patient- and hospital-level predictors of OS stays exceeding 48 (and 72) hours (prolonged OS). Hierarchical models were used to examine the additional cost associated with longer OS stays. Of the 696,732 patient OS stays, 8.8 percent were for visits exceeding 48 hours. Having Medicaid or no insurance, a condition associated with no OS treatment protocol, and being discharged to skilled nursing were associated with having a prolonged OS stay. Among Medicare patients, the mean charge for OS stays was $10,373. OS visits of 48-72 hours were associated with a 42 percent increase in costs; visits exceeding 72 hours were associated with a 61 percent increase in costs. Patient cost sharing for most OS stays of less than 24 hours is lower than the Medicare inpatient deductible. However, prolonged OS stays potentially increase this cost sharing.
    Health Services Research 12/2013; 49(3). DOI:10.1111/1475-6773.12143 · 2.78 Impact Factor
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