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Readmission conditions

The ethereal world of Medicare cost savings

Issue: "The Haiti quake," Feb. 13, 2010

The New England Journal of Medicine in April published a paper by Drs. Jencks, Williams, and Coleman pointing out the costly problem of re-hospitalization of Medicare patients: $17.4 billion of the $102.6 billion that Medicare spends annually on hospital care comes from hospital readmissions. The authors conclude that too many patients on Medicare are readmitted, about 20 percent in the first 30 days, and 34 percent in the first 90 days after discharge. About 67 percent of Medicare patients who were discharged with a medical diagnosis (diabetes, chronic lung disease, heart failure, etc.) were either readmitted or died the year after discharge.

The authors go on to speculate on the ways to decrease hospital readmissions, including (1) better care for conditions such as heart failure, including more support for out-patient home care; (2) more outpatient visits to doctors; (3) earlier doctor visits after surgery; (4) a concern about hospital profit motives; and (5) decreasing state-by-state variation in readmission rates.

The authors acknowledge that reducing hospital readmissions is an important element of financing President Obama's healthcare overhaul.

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Recently, Dr. Sandeep Jauhar reviewed this article in The New York Times, saying such proposals would be useless-hospitals don't admit patients, he said, doctors do. Dr. Jauhar contended that doctors kept patients longer than necessary in order to profit financially. Reform, he argued, must include giving doctors the right financial incentives.

Dr. Jauhar's argument is only half right. True, doctors admit patients, but do they keep patients in the hospital longer than needed? A better question might be, Can they keep a patient in the hospital longer than needed? Currently, hospitals are motivated to discharge Medicare patients as soon as they meet artificial discharge criteria because hospitals get one lump sum per primary diagnosis, regardless of the cost to the hospital for that hospital stay.

Hospitals have utilization review departments that scrutinize every chart daily to see if the patient qualifies for discharge. If the patient stays longer, then doctor are scolded, disciplined, and even denied hospital privileges for repeated offenses. To say, as Dr. Jauhar does, that doctors keep patients too long in order to profit financially fails to acknowledge the pressure on doctors from hospitals to discharge patients quickly.

In their article, Drs. Jencks, et al. ignore the obvious causes of hospital readmissions and instead use speculation and presuppositions to determine ways to decrease readmissions.

First, Medicare patients are the oldest and most infirm among us. Who would be more likely to be readmitted to the hospital? Medicare patients, along with doctors, face hospital pressure for discharge when artificial criteria are met. This process of early discharge (brought on by the pay system instituted by Medicare, which now complains about readmission) further increases the likelihood of readmission.

The authors' proposed solutions are as bad as their assumptions. That more outpatient visits would decrease readmissions is unsupported by data. More use of outpatient palliative care and home caring is code for not admitting the very ill-to save money. Death, after all, is the ultimate cost-containment. Better coordination between hospitals and doctors makes little sense, as doctors provide hospital care, discharge patients, and provide outpatient care. Blaming the profit motive of hospitals for readmissions again is a fatuous argument. Again, hospitals do not admit patients-doctors do. The state-by-state variation in hospital readmission rates varies from 13.3 percent in Idaho to 21.9 percent in New Jersey, with most bunched in the 19 percent to 20 percent range, hardly a dramatic variation.

It is on the questionable conclusions of studies like this that the president's cost-savings proposals hinge.

-Matt Anderson is a practicing OB/GYN in Minnesota and blogs regularly at


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