How Obamacare penalizes safety net hospitals

How Obamacare penalizes safety net hospitals

The weakest aspect to Obamacare is in its cost control strategies, or lack thereof.  The predicted savings from converting to electronic medical records (EMR) have failed to materialize.  And the Rube Goldberg-esque plan to save money by penalizing hospitals and doctors for having poor HCAHPS scores has reaped its own set of unforeseen complications.

HCAHPS (Hospital Consumer Assessment of Healthcare Providers and Systems) is the Press-Ganey survey tool that Medicare has decided to use as its sole objective instrument in determining relative hospital/physician “quality” rankings.   A low HCAHPS score puts a hospital system at risk of forfeiting up to 1% of its Medicare reimbursements.  High scoring systems can actually receive bonus payments.  Further penalties are accrued by hospitals for having high readmission rates after coronary events or pneumonia.

And what sort of valuable information is contained in these highly scientific and statistically predictive surveys?  Surely something about surgical outcomes or survival rates or some other such objectively measurable metric, right?  Actually no.  Here are the survey questions pertaining to the assessment of how good a physician has performed:

  •  During this hospital stay, how often did doctors treat you with courtesy and respect?
  •  During this hospital stay, how often did doctors listen carefully to you?
  •  During this hospital stay, how often did doctors explain things in a way you could understand?

Doctors who don’t receive top marks for these three questions risk being penalized, especially if they are employees of a giant healthcare consortium that depends on high HCAHPS scores for optimal profiteering.  The facilities themselves are graded according to a variety of criteria, all tenuously (at best) related to the provision of high quality healthcare.  Factors like room cleanliness, hallway silence, ultra-friendly nurses, prompt bedpan washouts, and how well side effects of medications are explained to you collectively form the basis for decisions to transfer of billions of dollars in Medicare funding from one hospital system to another.

Private hospitals are quite aware of the consequences and are proactively doing everything they can to minimize any loss in profits due to poor scores.  Armies of bureaucrats and patient advocates are hired to maximize the “patient experience”.  Employed doctors undergo specialized training courses in “customer servicing” in order to specifically raise their personal HCAHPS scores.     

But what about the larger safety net hospitals who service a disproportionately high number of patients from lower socioeconomic strata? These facilities often run rather tight margins and don’t have the wherewithal to throw around cash on image consultants.  Furthermore, the patient population that utilizes the big tertiary care centers tend to be less compliant with medical instructions.  They don’t take their pills.  They don’t follow up with their doctors.  And they tend to be re-admitted at a much higher rate.  As a result we end up with this:

So-called safety net hospitals, which provide a large amount of care to low-income and uninsured patients, also are more likely see payment cuts under the initiative, the research found.

Forty percent of large hospitals will be highly penalized compared with 28 percent of small hospitals, the research suggests. The authors defined large hospitals as those with 400 or more beds.

About 45 percent of safety-net hospitals are likely to be highly penalized compared with 30 percent of hospitals that don’t serve a significant number of low-income and uninsured patients, based on the findings.

In other words, the hospitals which can least afford cuts in reimbursement are the ones most likely to be penalized.  Meanwhile, profitable boutique hospitals in the suburbs can continue to marketize healthcare (more unnecessary MRI’s, more hip replacements on 85-year olds, more screening tests and more laboratory studies) without any recriminations whatsoever.  Because healthcare isn’t about healing the sick anymore.  That’s so 19th century.  In consumer driven, marketized modern healthcare the idea is to optimize the experience.  And make a gazillion dollars while you’re at it.

Jeffrey Parks is a general surgeon who blogs at Buckeye Surgeon.

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  • Dan983

    Yes, our great leader will further damage the lives of our poorest members of society. Already they are being instructed the efforts of upper mobility, IE, hard work and education, are a waste as no one can provided as much as government entitlements. Now, their centers available for health emergencies will collapse?

  • Bradley Evans

    Another posting today was on medical error. This posting is on bureaucratic error. I guess you could also call it “unintended consequences.” This could harm and kill, just like medical error can.

  • Michael L Wyland

    Too many hospitals and healthcare providers have become so focused on the clinical competence and procedural outcomes that they have lost sight of the holistic elements of service, both to the individual and to the community. As for cost implications, multiple studies draw positive correlations between patient satisfaction with providers and low malpractice claims suffered by providers.
    A corollary is the new community health needs assessment (CHNA) requirement for nonprofit hospitals. CHNAs seek to answer the question: how good is a hospital as being a charity, providing public benefit to its community?

  • Rules4Radicals

    It would have been nice if health care reform had been done in a bipartisan fashion.

    Instead we had a corrupt crony capitalist monstrosity passed in the dead of night, written by highly suspect Chicago Machine types, and passed without a single person voting on it ever reading it.

    Lucrative for the AARP, other insurers, polically connected companies, etc. Horrific for doctors and patients.

  • drd

    This is so very sad. i can hardly read this stuff anymore. It breaks my heart. When medicine allowed patients to be marketed by insurance companies and big pharma it turned their back on the most needy and vulnerable patients. It matters little whether one has insurance or not since the system is now set up to exploit patients–especially the elderly. Take your pick–being uninsured and abandoned vs. insured and exploited. Nice way to spend your retirement.

  • Zachary

    Looks like these facilities should work on their delivery of care then. Case closed.

    • Alice Robertson

      And how can they work on delivery of Dollar Tree type care that can live up the expectations set forth in the legislation? I am not sure this aspect is the “weakest” aspect of the well intentioned healthcare law that I think is a right mess, but the author’s point is well intentioned (admittedly it’s from a doctor’s vantage point, but isn’t that the point?). I believe Cleveland Clinic recently shared with it’s employee’s that it’s profitability this year will be history over the next few years. The government is using a hammer…harming employees, signing up more people for Medicaid, forcing insurers to keep young people insured then proclaiming a victory of more people insured, while others are being unloaded by employers avoiding fine (hence, why I wonder what really is the “weakest” aspect or the most “negligent” part of the legislation, or the “most harmful” to those who will be shut out of the system). The reality of the legislation drafted by socialistic minded healthwonks is that people will be hurt, along with doctors, and profitability. We can’t expect good care under the strong arm of the government…we can expect substandard care….and some will survive….and some will succumb no matter how high they raise that limbo bar..

  • Dia Smith

    This method is putting the patient first. This demonstrates that the doctor no longer has the upper hand. The patient does. Treat patients with respect and dignity and these fines would have never been a discussion let alone, actually implemented.

    • Alice Robertson

      It’s a good method and goal. I do think doctor’s colleagues of yesteryear did them a terrible disservice because years ago patient care was often atrocious (I really enjoyed reading an old book by a doctor who titled it, “Kill as Few Patients as Possible”:). Things were changing without this healthcare bill. Cleveland Clinic offers “World Class Care” to everyone. Their administration is top notch and patient oriented, yet they have a busy Ombudsman’s Office because of complaints. Sure sometimes they are negligent…humans have a habit of spawning curmudgeons! Ha! But, that said, some patients don’t like anybody or anything.

  • Kathrina Visitkarte

    How can you explain things to a guy who can’t tell the difference between a stomach and a bladder?

  • Doug Capra

    I don’t think any sane individual discounts the importance of survival rates and surgical outcomes. But you seem to imply that the following questions are insignificant:
    During this hospital stay, how often did doctors treat you with courtesy and respect?
    During this hospital stay, how often did doctors listen carefully to you?
    During this hospital stay, how often did doctors explain things in a way you could understand?

    Sometimes the medical system is so focused on the body and images of the body that they forget that there’s a human being attached to that body — a mind and soul. Certainly everyone patient wants to survive — but all encounters and procedures in hospital are not necessarily about life and death. Some in the system need to understand how important these emotional factors are to humans. How you do something is, yes, is as important as what you do. “The medium is the message.” Emotional factors play essential roles in health and recovery.

    Are those questions the only ones that should be asked and evaluated? Of course not. But they are as important as any other question you may ask. And the system had better just get used to it.

    Having said that, you make some very good points.

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