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A prognosis for the rural hospital: Part II: Are rural hospitals economically viable?

This is the second of a two part series that summarizes what is known about the operation and performance of the rural hospital and discusses potential options and strategies for strengthening the viability of these institutions. In Part II, we focus on the economic viability of the rural hospital and examine external factors that influence the environment within which the rural hospital operates. We conclude that the future will remain precarious for rural hospitals and that they can hope to improve their economic viability only if they are able to determine where they fit as part of the large health care system.

Bed Conversion↗

Length of stay data as a guide to hospital economic performance for ICU patients.

CONTEXT: Length of stay data are increasingly used to monitor ICU economic performance. How such material is presented greatly affects its utility. OBJECTIVE: To develop a weighted length of stay index and to estimate expected length of stay. To assess alternative ways to summarize weighted length of stay to evaluate ICU economic performance. DESIGN: Retrospective database study. SUBJECTS: Data for 751 ICU patients in 1998 at two hospitals used to develop weighted length of stay index. Data on 42,237 patients from 72 ICUs used as the basis of economic performance evaluation. MAIN OUTCOME MEASURES: Difference between actual and expected weighted length of stay, where expected weighted length of stay is based on patient clinical characteristics. RESULTS: Length of stay statistically explains approximately 85 to 90% of interpatient variation in hospital costs. The first ICU day is approximately four times as expensive, and other ICU days approximately 2.5 times as expensive, as non-ICU hospital days. In a regression model for weighted length of stay, patient clinical characteristics explain 26% of variation. ICU economic performance can be measured by excess weighted length of stay of a "typical" patient or by occurrence of long excess weighted lengths of stay. Although different summary measures of performance are highly correlated, choice of measure affects relative ranking of some ICUs' performance. CONCLUSION: Providers of statistical data on ICU economic performance should adjust length of stay for patient characteristics and provide multiple summary measures of the statistical distribution, including measures that address both the typical patient and outliers.

Accounting↗

Inpatient psychiatric units in nonteaching general hospitals. Response to public mental health policy or hospital economics?

The purpose of the study was to determine the extent to which the existence of inpatient psychiatric units (IPU) in general hospitals is related to patient service "needs," to certain economic and organizational characteristics of general hospitals, or to both. Area and institutional characteristics of general hospitals in Massachusetts were analyzed with multivariate techniques. Interviews were also conducted with representatives from hospitals and the Massachusetts Department of Mental Health in three mental health catchment areas. Most of the teaching hospitals in the state have IPUs. The study indicated that a statistical difference exists between characteristics of IPU and non-IPU nonteaching general hospitals. The probability that a nonteaching general hospital will have an IPU is related to both market conditions and institutional characteristics of the hospital. Nonteaching general hospitals with IPUs were more likely to be located in areas with higher incomes but fewer office-based psychiatrists per capita. IPU hospitals were also more likely to be larger and to receive a higher percent of their revenues from Medicaid than their non-IPU counterparts. The study did not provide evidence that "need" as defined by traditional indicators was an influential factor in IPU existence.

Community Mental Health Services↗

Interventional nephrology in a federal hospital: economics of health care.

Interventional nephrology is now an accepted subspecialty of nephrology that is revolutionizing the standard of care for renal failure patients. Interventional nephrology deals with the placement of tunneled cuffed catheters (TCCs) and maintenance of permanent vascular accesses, thus assisting in timely care. Prior to 2000 most end-stage renal disease (ESRD) patients from the Overton Brooks Veterans Affairs Medical Center (OBVAMC) were referred to an outlying hospital for TCC placement and endovascular procedures (EVPs) of permanent dialysis access. The referral process was cumbersome for the patients and expensive to the Medicine Service. OBVAMC started an interventional nephrology service in 2000. The current study reports the financial benefits of starting an interventional nephrology service at our institution. All procedures performed during the period from April 2000 to April 2004 were analyzed. The procedures were performed in the cardiac catheterization laboratory. The total payment (physician's and hospital fees) to the referral hospital for procedures prior to April 2000 was used to estimate the average savings to the Medicine Service over the last 4 years. A total of 129 TCCs and 43 EVPs were performed during this period. The estimated expense to OBVAMC would have been US dollars 603,978 for TCCs and US dollars 288,100 for EVPs based on charges prior to April 2000. The actual expense to the hospital, including facility fees and disposables, was US dollars 156,013. The net savings to OBVAMC over the last 4 years was US dollars 736,065. Interventional nephrology provided to a small population of renal failure patients in a tertiary federal health care facility has resulted in huge savings for the hospital. Increasing awareness of this procedural aspect of nephrology benefits not only the patients, but also helps ease the financial burden of ever-escalating health care costs.

Angioplasty, Balloon↗

Old memories and new dreams: economics for nonprofit hospitals.

Economics has been introduced as an aspect of competition among hospitals. Pricing systems are growing in importance. In general, wise economics is being stressed. This study considers the characteristics of networks, investor-owned hospitals, and nonprofit hospitals. The author suggests ways for nonprofit organizations to recover and remain strong.

Economics, Hospital↗

Economic credentialing survey of university teaching hospitals.

Economic credentialing, the process of applying economic criteria to the determination of initial appointments or reappointments of physicians to hospital medical staffs, has become a major issue in hospital medical staff relations. Nearly all major academic health center hospitals have the ability to perform economic analyses of faculty/physician clinical practices, and more than one-third of their CEOs see nothing wrong with terminating or denying hospital privileges for excessive use of hospital resources. Sixty-eight percent of surveyed academic health center respondents currently develop and review physician practice profiles, but only 35 percent of these respondents include economic data.

Academic Medical Centers↗