Scrutinizing Long-Term Care Hospitals

  • Date: March 23, 2010
  • Source: Admin
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The Senate Finance Committee is initiating an investigation to delve into patient safety and quality of care provided by long-term care hospitals. 

Long-Term Care Hospitals – Facts

The New York Times found that in spite of having only a handful of healthcare professionals, long-term care hospitals treat 200,000 seriously ill patients every year. Most of the long-term hospitals have no doctors on its staff or its wards overnight and in emergencies, they need to call in physicians from outside. In addition to it, unlike any normal hospital, the long-term care hospitals have only 60 beds and do not have emergency rooms. 

Amazingly, in last 25 years, the number of long-term hospitals exploded and now around 400 similar facilities have opened nationally. Few of them have doctors on staff and most of the hospitals are owned by for-profit companies. Amongst all companies, the Select Medical Corporation is a publicly traded Pennsylvania company that runs 89 long-term hospitals, more than any other company.

According to the available federal data of most recent year, long-term care hospitals had a higher incidence of bedsores and infections than regular hospitals in 2006. And, according to an analysis by The New York Times, in 2007 and 2008, Select’s hospitals were cited at a rate almost four times that of regular hospitals for serious violations of Medicare rules. Other long-term care hospitals were cited at a rate about twice that of regular hospitals.

Exploiting the Medicare loophole, profit margin of these facilities is increasing in leaps and bounds. These facilities, which in 1993 billed the government $400 million, are expected this year to bill $4.8 billion. According to Medicare officials, in the early 1980s, there were less than 10 hospitals were dedicated to long-term care existed. But many such hospitals have sprouted since then, driven by Medicare rules that offer high payments for hospitals that treat patients for an average of 25 days or more. 

Serious Questions about Quality of Care

Despite the rapid expansion of long-term care hospitals and the serious illnesses they treat, Medicare has never closely examined their care. Unlike traditional hospitals, Medicare does not penalize them financially if they fail to submit quality data.

As a result, some serious questions are rising in last few years about the quality of care given patients by these facilities. An investigation done by the New York Times reveals that these hospitals need far greater scrutiny by regulators and a change in the rules regarding the way they are paid. Even their quality of care also needs improvement to a great extent.

What Medicare Payment Advisory Commission Says

Analyzing the available data, the Medicare Payment Advisory Commission, a Congressional research agency, says that the for-profit long-term hospitals generally spend less on patients and have higher margins than comparable nonprofits.

To add to that, in 2007, for-profit long-term care hospitals had margins of 6 percent on Medicare patients, while regular hospitals lost an average of 6 percent on Medicare patients.

Inspectors have found 22 violations of care standards at 12 Select hospitals in the last three years. Those violations were so serious that, if uncorrected, could lead Medicare to ban those hospitals from admitting Medicare patients.

Steps Taken by the Government

According to the Senate Finance Committee’s press release, the chairs of the committee, Sen. Max Baucus, (D-Mont.) and Sen. Charles Grassley (D-Iowa), have sent letters to the Government Accountability Office, seeking information on disclosure of its discharge policies, as well as those covering patient monitoring, emergency situations and staffing, including physician involvement at its hospitals and staff turnover.

Source: Alex Berenson, "Long-Term Care Hospitals Face Little Scrutiny," New York Times, February 9, 2010.

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