Health Care News & Discussion
Private Hospital Care vs Integrated Hospital Care
02/04/2007 2:51 PM
The high-tech hospital is extremely important for the complicated and seriously ill patient. However, as this conference repeatedly pointed out from acquired infections to simple blood transfusion, it is an increasingly hazardous environment. The consequences extend far beyond the hospitalization into the ambulatory care arena. As hospitals lose much of their volume from inpatients, they have increasingly resorted to outpatient medicine. However, it has repeatedly been shown that outpatient hospital medicine is far more expensive than similar treatment in a doctor’s office – sometimes on the order of two or three-fold. It also depends on the system and reimbursement mechanisms.
In the average hospital, the goal is increasing revenue, which is how they stay in business. But it is increasingly costly and maybe gluttonous. A recent example surfaced.
There is a great emphasis on pulmonary rehabilitation in recent years. Medicare reimburses for this. I had a patient that enrolled at the local hospital and he stated that Medicare was billed about $2500 for the two-week program. There were about 20 COPD patients in his group and he figured that the hospital revenue for providing one respiratory therapist for two hours a day to lead this group netted the hospital well over $50,000 for what he estimated at 25 hours of work.
I also had some Kaiser Permanente patients in my research group that went to pulmonary rehabilitation at KP three days a week for 10 or 15 years. There was no charge in this integrated health care system. I made a visit to the rehab unit and spoke with the respiratory therapist. He stated that KP provides these facilities and saves considerable moneys by preventing hospitalizations. He had the figures to prove that when patients dropped out of the program, they were more likely to go to the emergency room and be admitted.
The key difference is that the private hospitals make money on such programs and also make money on the failure of such programs, which then requires admission to their high-cost center.
KP, being an integrated health care system with the three arms of Kaiser Foundation Hospitals, Kaiser Foundation Health Plans, and The Permanente Medical Group, work in concert with each other to reduce health care costs. They are connected through electronic medical records that allow any Permanente physician to access a patient’s medical record from any computer terminal within the system. It appears to be a winning combination. They feel that this is the answer to the insurance dilemma.
These messages were written in the years as noted and may be somewhat dated at this time. Please consult your physician or other health care provider.