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Medicare Rules Make Offsite Organ Recovery Costly

 |  By cclark@healthleadersmedia.com  
   March 26, 2014

Using organ procurement organizations reduces costs and is safer for patients and medical staff. But complex reimbursement rules deter some transplant hospitals from allowing organs from brain-dead donors to be recovered off site.

Many hospitals with transplant programs are refusing to allow brain-dead organ donors to be transported to more efficient off-site organ recovery centers citing a federal rule they say would cost them millions of dollars in Medicare reimbursement.

"This rule has a significant financial impact to transplant centers that are also medium or large donor facilities," says Deb Maurer, administrator of the transplant program at UPMC in Pittsburgh. "Though this [concept of off-site donor recovery centers] has wonderful potential and makes a lot of sense to us, we can't in today's healthcare market take that financial risk of moving these donors out of our facility" for organ recovery.


Organ Recovery Centers Reduce Transplant Costs 37%


For UPMC, whose seven programs transplant more than 600 organs a year, the Medicare cost hit would be in the millions, Maurer says. So the Center for Organ Recovery and Education, the organ procurement organization serving western Pennsylvania, will have to rely on hospitals without transplant programs for organ donors.

Trouble is, hospitals with transplant programs also have trauma centers, the source of the lion's share of patients who will be declared brain-dead and suitable for organ donation.

Maurer says she knows of other organ procurement organizations that have built similar offsite organ recovery centers that "sit empty for this exact same reason."

At Gift of Life, an organ procurement organization in Ann Arbor, 80% of the donors the center receives come from non-transplant hospitals. None of the city's transplant hospitals will allow organs from brain-dead donors to be recovered off site, says Richard Pietroski, CEO of Gift of Life.

At least four regional Medicare-certified organ procurement organizations — in St. Louis, Pittsburgh, Denver, and Ann Arbor— have established organ recovery centers to avoid time delays when surgeons from transplant recipients' hospitals arrive to remove organs from brain-dead donors.

Chicago's and Philadelphia's OPOs have similar efforts. Except for St. Louis, they're relying on non-transplant hospitals for all the donors that come to them for organ recovery. When organs become available in those cities, surgical teams must still travel to the hospitals where the donor originated to recover the organs.

Benefits of OPOs
The process is cheaper, OPO officials say, because the organizations can perform tests and services to keep the donor breathing at much lower cost than the donor hospital, saving Medicare money.

And OPOs are safer for medical teams, because they don't have to travel long distances to recover organs in unfamiliar hospitals. To date, accidents have killed at least 30 surgeons and transplant specialists rushing to retrieve and deliver organs for transplant. Finally, OPOs are more efficient, because recovery can happen on schedule, without wasting time or facility space.

Joe Weber, vice president of finance for CORE in Pittsburgh, says that Medicare should find a solution because pre-transplant service expenses would drop. "If we can save money to the transplant program, we would hope that would get passed on," he says.

Maurer, and several other hospital transplant finance experts, say that the complex Medicare cost report policy can be summarized like this:

Hospitals with transplant centers can add into their Medicare cost reports each year amounts spent for certain staff salaries, utilities, testing services, physician consult fees, the costs of surgeons who fly out to recover organs elsewhere, and transplant center square footage, anything that's determined to be a "pre-transplant service" cost.

A Complicated Cost Structure
But what percentage of those costs they can claim depends on how many organs those hospitals transplant into Medicare patients as well as how many organs are recovered from Medicare patients—but only if those organs are recovered on site.

For example, if 50 of the 100 organs a hospital transplanted were to go to Medicare patients, and the hospital recovered another 100 organs from donors, Medicare would see that as the hospital having 150 of its 200 "useable organs" benefitting Medicare beneficiaries. Therefore 150 of its 200 organs could be assigned a pre-transplant service for Medicare, and Medicare would reimburse the hospital 75%.

But if those 100 organs from brain-dead donors were recovered elsewhere, at an OPO surgical facility offsite, the hospital would be allowed to capture only 50% of its transplant costs (50% of 100). Those 100 donor organs could not be counted for Medicare payment.

Gene Ridolfi, director of the Barnes Jewish Hospital's organ transplant program in St. Louis, where the nation's first off-site organ procurement center was built in 2001, says his hospital is among a rare few that allow brain-dead organ donors to go to the St. Louis center for organ recovery, even though "we're well aware that it's costing us money, and it's a significant amount of money."

For any hospital, he says, it "can be" in the millions of dollars depending on how many donors are cared for at any given hospital. Barnes Jewish is taking the loss, Ridolfi says, because "we think it's a better model for multiple reasons."

"Donors are better managed in the OPO than in our ICUs, because that's what they do. And we think in many cases it's better for the families because [the process] happens much quicker.

"And our ICUs (where brain-dead donors are kept until surgery if they are not transported to the OPO center) are near 100% capacity. If we have a brain dead donor, it behooves us to make room for someone we might be able to save, where we have extremely busy operating rooms."

Ridolfi says that surgical procedures to recover organs at Barnes Jewish Hospital "tend to disrupt operating room schedules and delay other cases, so we've recognized all of this as beneficial for us."

Maria Majella Doyle, MD, a liver transplant surgeon at Barnes Jewish Hospital/Washington University, says that when the St. Louis OPO started the off-site recovery center, "no one realized there would be a reimbursement issue." Now, she says, Barnes Jewish and other hospitals "realize how much they're losing, but the system is so streamlined that going back to the way it was is something none of our transplant surgeons would agree to."

Firmly Not Participating
Further complicating the issue is that Medicare's rules on cost recovery were written decades ago, before organ donation became so common and before the concept of offsite recovery centers was conceived. The prohibition against recovering costs for donor organs is not specified, but is the way one Medicare Part A administrative contractor has interpreted it. All the other contractors are said to be in agreement, several transplant experts say.

Other transplant center hospitals around the country are firm in their resolve not to participate until Medicare settles the question, which the OPOs hope the agency will do soon. A meeting at the Baltimore Medicare offices is scheduled for April and an entire session will be devoted to the topic, Doyle says. OPO officials say they have hired a lobbyist to push the case.

Ridolfi says transplant centers have put pressure on Barnes Jewish to join in their resistance, given how much money they could be getting from federal funds.

"I certainly have been challenged when I'm out nationally talking about this," he says. "And everyone wants to know why we [at Barnes Jewish] have taken this position. But for our situation, we think that it is [best], and we're fortunate that we're two blocks from our OPO, which makes it easier for our physicians."

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