Hospital EDs Seeing Sicker Medicare Patients

The federal government's inpatient admissions guidelines and growing claims denials are heaping pressure on hospitals to treat Medicare patients in the ED rather than admit them. Meantime, the severity of illness is rising, says the American Hospital Association.

Hospital emergency departments are treating growing numbers of sicker Medicare patients who require more complex and expensive treatment regiments, the American Hospital Association reports [PDF].

"The drivers [are] both the aging demographic, but also just that people are getting sicker. Chronic diseases are skyrocketing," says Caroline Steinberg, AHA's vice president of trends analysis.

"A lot of it has to do with lifestyle factors like obesity. We did look to see if the aging of the Medicare population was driving this and we didn't find a big change in terms of age. We did find that people are simply getting sicker. That is what a lot of the researchers say, that most of the chronic disease burden is related to lifestyle factors, exercise, weight, that sort of thing."

The AHA says data shows that between 2006 and 2010, the severity of illness of Medicare patients in the emergency department increased, as did the rate of use, a trend that policymakers fear is leading to higher spending with inadequate reimbursements.

Steinberg says hospitals want the federal government to acknowledge what the data clearly shows.

"We would just like recognition by [the Centers for Medicare & Medicaid Services] that patients are in fact getting sicker and that it is not related to changes in the coding claims, but that we really are seeing patients getting sicker," she says. "We have run into this problem in the inpatient setting as well, where CMS doesn't want to pay for rising acuity levels."  

The federal government's more stringent inpatient admissions guidelines and growing claims denials are also putting more pressure on hospitals to treat Medicare patients in the ED rather than admit them.

"We are seeing an increase by audits by the [recovery audit contractors] and other Medicare auditors that are denying admission for short stays so there is huge pressure on hospitals not to admit patients unless they are very sure that those cases can be fully justified through medical necessity," Steinberg says.

"Nobody is questioning whether the care provided was medically necessary. They are just questioning whether or not it was provided in the right setting."

CMS in March said it would change its policy of flatly denying any reimbursements to hospitals that provide medically necessary care determined by auditors to have been delivered inappropriately in an inpatient setting. While that will allow hospitals to re-bill Medicare for hundreds of millions of dollars in uncompensated care, Steinberg says re-billings can only date back one calendar year.

"Unfortunately most of the RAC denials are occurring beyond a one-year timeframe. You can do it, but it is not going to help because that's when all the denials are happening," she says.

The AHA report is limited to Medicare claims data, but Steinberg says the advent of expanded health insurance coverage in 2014 under the Affordable Care Act means that EDs will probably see an uptick in usage from other demographics "as more patients become insured and there is still limited access to primary care in many areas particularly in poor neighborhoods."

"We haven't looked at what is going on in terms of other populations, but we would imagine that everybody is getting sicker because it's not like it all happens the day you enter the Medicare program. The obesity and the sedentary lifestyle and the high-stress environment—all those things are risk factors long before you enter Medicare, and a lot of that is exacerbated in the Medicaid population," Steinberg says.

The AHA report, based on an analysis of Medicare claims data conducted by The Moran Company, also found that use of the emergency department by Medicare/Medicaid "dual-eligible" patients is rising, and; EDs are serving more Medicare patients with behavioral health diagnoses.