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Wound Healing Centers Benefit Hospitals Financially, Strategically

Marianne Aiello, for HealthLeaders Media, December 28, 2009

Chronic wound care is among the procedures patients are not putting off amid the economic recession—and hospitals that partner with wound healing centers are reaping the benefits.

"I've definitely seen changes in the payer mix, but the volume is steady," says Renee Skinner, program director at 6-hospital system UNC Healthcare's Wound Healing Center. "When you have this type of issue, people will cut back on the things that are basic healthcare, but when they have an open wound that's painful, that's infective, they can't ignore that. You can see the impact in the individual patients' lives [due to layoffs], but the medical need doesn't change with the economic climate of a nation."

Wound healing centers tend to be revenue-drivers for hospitals because of both high demand and high-reimbursement rates. Diabetic, bariatric, and geriatric patients are most at risk for developing chronic wounds and, because of the aging boomer population and climbing diabetes and obesity rates, the number of wound care patients is expected to increase.

"UNC understood that wound care is a specialty and unfortunately in our culture there's a tremendous need, especially with the rise of diabetics in the nation," Skinner says of the Chapel Hill, NC system. "With a wound center, you can delve deep at UNC because we're close to the vascular center. You can't just treat the wound, you have to figure out why you have the wound… and they have access right here in the clinic to be able to treat the whole patient."

Hospitals with wound healing centers are often financially profitable because Medicare has a high-reimbursement rate for wound procedures and hyperbaric medicine, says Bob Bauman, MBA, chief development office at National Healing Corporation, a wound management company based out of Boca Raton, FL. The Medicare reimbursement rate is important to wound healing centers because a large percent of patients are under the plan, including 62% of patients treated by National Healing Corporation.

"In the last four-to-six years, CMS has had a steady reimbursement increase on those procedures, not only for the hospital, but the physicians who perform those procedures," he says. "The reason why Medicare has continued to increase it is because the cost of care is so effective."

Another benefit for a hospital to partner with a wound healing center is its popularity among referring physicians. "A wound care patient takes a lot of time—what we can offer is to focus on the specific care of the patient's wound," says Skinner. "It's very expensive to staff and keep up with the latest wound care products and plan of care, so for a general practice, it is not effective for them to try and manage this part of the patient's care."

Partnering with a wound healing center also gives hospitals the chance to one-up the competition. "It gives the hospital an opportunity to gain market share in a specific location, if they're the only hospital that provides that service line," Bauman says. And, unlike standalone wound healing centers, patients at a hospital-owned center can seamlessly be referred to other physicians in the organization.

Because having a wound healing center can be a strong market differentiator, many organizations have little need to launch any marketing efforts.

"We don't do a lot in terms of marketing direct to the consumer," says Terri Harris, director of the Wound Healing and Hyperbaric Oxygen Center at Chandler (AZ) Regional Medical Center. "It's expensive to put ads in the newspaper or TV and radio commercials, and we have to get authorization from insurance companies. I find it's better to do the education to the physician at his or her office and then they're able to refer the patient in."

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