KHN Morning Briefing

Summaries of health policy coverage from major news organizations

Research Roundup: Saving Money With Hospital Observation Units

Each week KHN reporter Ankita Rao compiles a selection of recently-released health policy studies and briefs. 

Health Affairs: Making Greater Use Of Dedicated Hospital Observation Units For Many Short-Stay Patients Could Save $3.1 Billion A Year
The authors write: "Using observation units in hospitals to provide care to certain patients can be more efficient than admitting them to the hospital and can result in shorter lengths-of-stay and lower costs. However, such units are present in only about one-third of US hospitals. ... Using a systematic literature review, national survey data, and a simulation model, we estimated that if hospitals without observation units had them in place, the average cost savings per patient would be $1,572, annual hospital savings would be $4.6 million, and national cost savings would be $3.1 billion" (Baugh et al., 9/26). 

Journal of the American Medical Association: Total Knee Arthoplasty Volume, Utilization, and Outcomes Among Medicare Beneficiaries, 1991-2010
"Between 1991 and 2010 annual primary [total knee replacement] volume increased 161.5% from 93,230 to 243,802," according to this study which specifically evaluated trends in the Medicare population. The cost of the procedure is approximately $15,000 and succeeds in “safely reducing pain and improving functional status”. Researchers found that increases in "TKA volume have been driven by both increases in the number of Medicare enrollees and in per capita utilization. We also observed decreases in hospital [length of stay] that were accompanied by increases in hospital readmission rates" (Cram et al., 9/26).

Archives of Internal Medicine: Geographic Variation in Outpatient Antibiotic Prescribing Among Older Adults
By examining Medicare Part D records, researchers found a significant relationship between location and antibiotic use. The rate of patients using antibiotics per quarter was highest in the South, 21.4 percent, compared to 19.2 percent in the Midwest and 17.4 in the West. The drugs had been primarily prescribed for bacterial pneumonia, acute nasopharyngitis, and other acute respiratory tract infections. The Northeast, which had the highest prevalence of bacterial pneumonia, had the lowest rates antibiotic use. The authors concluded: "Areas with high rates of antibiotic use may benefit from targeted programs to reduce unnecessary prescription. Quality improvement programs can set attainable targets using the low-prescribing areas as a reference" (Zhang, Steinman and Kaplan, 9/24).

The Milbank Quarterly: Fundamental Causes of Colorectal Cancer Mortality: The Implications of Informational Diffusion
Colorectal cancer deaths, which will claim an estimated 52,857 lives this year, can be prevented through removing polyps, radiation and chemotherapy if identified through timely screening. But researchers found that there are socioeconomic disparities in mortality rates. By examining death and "diffusion of information" data in counties from 1968 to 2008, they found that southern states tend to have the worst outcome, because of their lower socioeconomic demographics. The authors noted that the "impact of socioeconomic status (SES) on colorectal cancer mortality is substantial and its protective impact increases over time." The disparity is attributed to access to information that authors said could be mitigated through “aggressive colorectal cancer screenings, better treatment protocols” and publicizing screening recommendations (Wang et al., 9/2012). 

The Commonwealth Fund: As CareFirst Tweaks The Medical Home, Doctors Flock and Costs Dip
CareFirst BlueCross BlueShield launched one of the country’s largest medical home programs in January 2011. Now they are targeting small clinics, especially in rural areas, to join a network. Doctors in the CareFirst model are grouped together, sometimes across several practices, to communicate about screening, access and effectiveness and controling costs. If one medical home is prescribing more tests than another, they are "educated about community norms." CareFirst has recorded a 1.5 percent drop in medical expenses, or a $40 million savings, of which roughly $22 to $23 million is to be paid back to providers (Schilling, 9/25).

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