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8 Reasons Why Hospitals Should Reduce Bed Volume

 |  By cclark@healthleadersmedia.com  
   October 06, 2011

There are nearly one million hospital beds in the United States. But I've been wondering, what are we going to do with all the empty ones if the healthcare industry successfully achieves the goals of reform?

Should hospitals start thinking about closing them down? That's anathema to the premise under which the industry has functioned for decades, which holds that the number of services, buildings and patients must grow to stay in play and maintain respect in the community.

Before you ask what I've been smoking, (nothing!) hear me out:

1. One in five or six patients is now readmitted within 30 days, but penalties and incentive programs can dramatically prevent those readmissions. A one-third reduction is not an unreasonable achievement, Elliott Fisher, MD, director of the Dartmouth Institute's Center for Population Health, told me last week.

Fisher lamented how hospitals that have successfully reduced readmissions have turned around and launched questionable service lines that don't improve care, such as spine surgeries. Hospitals are expanding volumes for procedures that, given correct and balanced information about their effectiveness and their alternatives, he says, patients would choose not to have.

"With hospitals that are dependent on fees for maintaining hospital margins, reducing unnecessary readmissions and avoidable admissions causes revenue losses, which will lead them to admit other patients to the hospital" for these elective procedures, he said.

That's not consistent with the "systematic reform in healthcare that we at Dartmouth have been calling for, (which) is about keeping people healthy so they don't need to be in the hospital," he continued.

"It's about making sure patients make informed choices about major surgical procedures or elective procedures, and then right-sizing the healthcare system, which may very well lead to many, many fewer hospital beds and hospitals in this country. And that's how you would get lower costs."

2. More patients will be encouraged – perhaps through premium incentives – to sign advance directives. We know from research that treatment-limiting advance directives have the potential to prevent aggressive, expensive, but futile care at the end of life, especially in regions of the country where imminent death is more expensively and often painfully prolonged.

3. Doctors and nurses will get better at constraining healthcare-associated infections, thus reducing longer stays. They will get better at preventing falls, surgical mishaps, and other avoidable adverse events, in part because those will now be publicly reported and because that extra care those errors require will not be federally reimbursed.

4. More patients will be treated in outpatient settings, because accountable care organizations and coordinated outpatient services will make sure patients stay out of the hospital if they don't need to be there. Patients who do need hospital care will be discharged earlier because bundled payments will hasten that process.

Just this week for example, we see a report that many elective percutaneous coronary revascularization patients can be safely discharged six hours after their procedure, rather than kept in a hospital bed overnight. This could free at least 35,000 or more hospital beds days each year.

Even bariatric surgery, which just a few years ago required a hospital stay of a week or more, is now being done laparoscopically.  Adjustable gastric band procedures, approved by the U.S. Food and Drug Administration in February, can sometimes be done on an outpatient basis.

5. Emergency departments will become even more creative in managing patients who don't need admission, using urgent care clinics and observation alternatives.

6. In some states the number of hospital beds, even with hospital closures, is on the increase. In California, for example, the number of hospital beds has had a net growth of 5% between 2005 and 2010, according to the Office of Statewide Health Planning and Development. And, many hospitals that are rebuilding to meet the state's strict safety requirements are adding licensed beds, not reducing them, as they upgrade from double-bed rooms to single-bed rooms, and expand in an effort to dominate a market.

Now, I know what you're thinking: "What about all the normal growth in population and all the aging baby boomers who will soon need care? What about the 32 million uninsured Americans who will soon have coverage?" 

Please see reasons 7 and 8.

7. Yes, aging baby boomers will need acute care. But how much? This generation isn't the type to be content lying around in hospital beds at the rates of prior generations. They will do more research about their conditions and question medical authority more. And they will be better managed outside hospitals.

Last week, a survey in the Archives of Internal Medicine, found that 42%of primary care doctors "believe that patients in their own practice are receiving too much care," that is, too many referrals and too many tests, and only 6% said patients are receiving too little. About 28% said they are practicing more aggressively than they would like.

8. As for those 32 million people who lack health coverage. Remember, most of them are barely accessing the healthcare system now. And if they are, it's an inefficient and more expensive service, they're getting at best. And in theory, much of it will be avoided with earlier, more preventive care.

Besides, I don't believe that healthcare reform will prompt them to charge into hospitals to make up for lost time. Coverage should help them stay healthier.

You might argue that hospitals should keep those beds and even expand capacity to be ready in the event of an epidemic or disaster. Good point.

But remember that in the wake of the 9/11 attacks and the threat of H1N1, pandemic planners have been busy preparing to adapt schools, theaters, and even cruise ships to handle casualties outside of hospitals. During a crisis, a hospital may not even be the safest place to go. 

We are in for big changes in the next few weeks, months and years from the Joint Select Committee on Deficit Reduction, or Super Committee, the Independent Payment Advisory Board, numerous accountable and pay for performance incentives and the folks in Washington who will decide the fate of the Sustainable Growth Rate.

These decisions are certain to further drive down rates of reimbursement for hospitals, physicians and other providers. And who knows how they will choose to compensate for that, whether by reducing services, salaries and staff, merging forces, postponing construction projects and by just being logarithmically more efficient than they are today.

Or by contriving ways to market more services with hefty margins, whether justified or not. 

As Fisher said, the problem is not just readmissions, "it's avoidable admissions overall."

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