What Is an Observation Stay? Evaluating the Use of Hospital Observation Stays in Medicare

The Utilization of 15-Minute Multidisciplinary Rounds to Reduce Length of Stay in Patients under Observation Status

With the recent change to value-based care, institutions have struggled with the appropriate management of patients under observation. Observation status can have a huge impact on hospital and patient expenses. Institutions have implemented specialized observation units to provide better care for these patients. Starting in January 2020, coinciding with the initiation of daily multidisciplinary rounds, our study focused on patients aged 18 and older admitted to our hospital under observation status. Efforts were built upon prior initiatives at Jersey Shore University Medical Center (JSUMC) to optimize patient care and length of stay (LOS) reduction. The central intervention revolved around the establishment of daily "Observation Huddles"-succinct rounds led by hospital leaders to harmonize care for patients under observation. The primary aim was to assess the impact of daily multidisciplinary rounds (MDR) on LOS, while our secondary aim involved identifying specific barriers and interventions that contributed to the observed reduction. Our study revealed a 9-h reduction in observation time, resulting in approximately USD 187.50 saved per patient. When accounting for the period spanning 2020 to 2022, potential savings totaled USD 828,187.50 in 2020, USD 1,046,062.50 in 2021, and USD 1,243,562.50 in 2022. MDR for observation patients led to a reduction in LOS from 29 h to 20 h (p < 0.001).

Associations of Postdischarge Follow-Up With Acute Care and Mortality in Lupus: A Medicare Cohort Study

OBJECTIVE

Patients with systemic lupus erythematosus experience the sixth highest rate of 30-day readmissions among chronic diseases. Timely postdischarge follow-up is a marker of ambulatory care quality that can reduce readmissions in other chronic conditions. Our objective was to test the hypotheses that 1) beneficiaries from populations experiencing health disparities, including patients from disadvantaged neighborhoods, will have lower odds of completed follow-up, and that 2) follow-up will predict longer time without acute care use (readmission, observation stay, or emergency department visit) or mortality.

METHODS

This observational cohort study included hospitalizations in January-November 2014 from a 20% random sample of Medicare adults. Included hospitalizations had a lupus code, discharge to home without hospice, and continuous Medicare A/B coverage for 1 year before and 1 month after hospitalization. Timely follow-up included visits with primary care or rheumatology within 30 days. Thirty-day survival outcomes were acute care use and mortality adjusted for sociodemographic information and comorbidities.

RESULTS

Over one-third (35%) of lupus hospitalizations lacked 30-day follow-up. Younger age, living in disadvantaged neighborhoods, and rurality were associated with lower odds of follow-up. Follow-up was not associated with subsequent acute care or mortality in beneficiaries age <65 years. In contrast, follow-up was associated with a 27% higher hazard for acute care use (adjusted hazard ratio [HR] 1.27 [95% confidence interval (95% CI) 1.09-1.47]) and 65% lower mortality (adjusted HR 0.35 [95% CI 0.19-0.67]) among beneficiaries age ≥65 years.

CONCLUSION

One-third of lupus hospitalizations lacked follow-up, with significant disparities in rural and disadvantaged neighborhoods. Follow-up was associated with increased acute care, but 65% lower mortality in older systemic lupus erythematosus patients. Further development of lupus-specific postdischarge strategies is needed.

The Costs Of Disparities In Preventable Heart Failure Hospitalizations In The US South, 2015-17

Black Americans in the US South have high rates of preventable heart failure hospitalizations, which reflects systemic inequities that also produce economic costs. We measured the direct medical costs of disparities in preventable heart failure admissions (that is, excess admissions) among Medicare beneficiaries living in six states in the US South (Kentucky, Arkansas, Florida, Georgia, Mississippi, and North Carolina). We used 2015-17 data from the Healthcare Cost and Utilization Project and constructed negative binomial models with state-level fixed effects to calculate adjusted admission rates with heart failure as the principal diagnosis. We calculated the number of these admissions that would have been avoided if Black, Hispanic, Asian/Pacific Islander, and American Indian/Alaska Native Medicare beneficiaries had the same admission rates as White beneficiaries. We found 28,213 excess admissions (48 percent excess) with $60,845,855 annual costs among Black beneficiaries, 3,499 (14 percent excess) with $8,179,381 annual costs among Hispanic beneficiaries, and 550 (51 percent excess) with $1,093,472 in annual costs among American Indian/Alaska Native beneficiaries. Failure to address heart failure treatment inequities in the community has a high opportunity cost.

The Hospital Readmissions Reduction Program and Observation Hospitalizations

The Centers for Medicare & Medicaid Services (CMS) Hospital Readmissions Reduction Program (HRRP) penalizes hospitals having excess inpatient rehospitalizations within 30 days of index inpatient stays for targeted conditions. Observation hospitalizations are increasing in frequency and may clinically resemble inpatient hospitalizations, yet HRRP excludes observation in index and 30-day rehospitalization counts. Using 100% 2014 Medicare fee-for-service claims and CMS's 30-day rehospitalization methodology, we modeled how observation hospitalizations impact HRRP metrics when counted as index (denominator) and 30-day (numerator) rehospitalizations. Of 3,806,772 index hospitalizations for HRRP conditions, 418,923 (11%) were observation; 18% (155,553/876,033) of rehospitalizations were invisible to HRRP due to observation hospitalization as index (34%; 63,740/188,430), 30-day outcome (53%; 100,343/188,430), or both (13%; 24,347/188,430). By ignoring observation hospitalizations as index and 30-day events, nearly one of five HRRP rehospitalizations is missed. Policymakers might consider this an opportunity to address broad challenges of the two-tiered observation and inpatient hospital billing distinction.