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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    • "[5] To avoid inconsistencies, CMS has released new rules for 2014 that modify the observation status definition to include only physician ordered medically necessary services with no more than two mid-nights hospital stays. [6] Since managed care payers are rigid on standards of payment for their subscribers, it is important for AMCs to find ways to effectively utilize and allocate resources for their growing outpatient populations. One possible strategy is the establishment of centralized observation units (COUs). "

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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.
    Full-text · Article · Feb 2014 · International Journal of Emergency Medicine
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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 . . .
    No preview · Article · Oct 2013 · New England Journal of Medicine
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