One of the big topics for discussion in the plenary sessions was the impact of the ever changing regulatory environment on hospital medicine. Bob predicts a major trend toward closure of hospitals in just the next few years as if it's something new. But we've seen this before, haven't we? In fact it's been going on ever since Medicare enacted the Prospective Payment System (DRGs) in 1983.
Consider this paper for example. According to the report many hospitals closed in the 1980s due at least in part to the advent of Medicare's Prospective Payment System:
Throughout the 1980s a tremendous number of rural hospitals closed their doors nationwide due to the impact of rural outmigration, shifting demographics and changes in Medicare payment methodologies.
This section of the report elaborates on the impact of DRGs:
Early on, Medicare and many other third party insurers simply paid what the hospital charged for the care received by the beneficiary. Then, in 1982, as a result of the TaxEquity and Fiscal Responsibility Act8 (TEFRA), Medicare started transitioning over to a new reimbursement methodology called the prospective payment system in an effort tocontrol costs. For inpatient services, Medicare would pay a set amount per diagnosis related group (DRG)9
As McGuire et al. (1993) point out, PPS was designed to reward efficiency. If a hospital could find a way to keep its costs below the rate of payment, the difference could be considered a profit. This concept was problematic for many rural hospitals because costs were usually well above these generally determined reimbursement rates. Fluctuations in the cost of providing care were not taken nto account by Medicare and were skewed toward urban providers. Medicare has saved a lot of money over the years but cost rural America a lot of hospitals as well.
A lot of hospitals did close and those that stayed open shifted inpatient beds to other lines of service. Things only got worse through the years as Medicare tightened its noose and private payers adopted the DRG model. We've been on a trajectory of more and more regulatory baggage ever since but it has been smooth. Obamacare means we'll progress along that continuum. It'll be disruptive but not nearly so much as with DRGs unless I miss my guess.
So what, says Bob, does this mean for hospitalists? Why, value! It's been Bob's mantra for years and it goes something like this: the hospitalist model has proven its value (in terms of resource utilization and outcomes) up to now and will have to work even harder to do so in order to thrive as a specialty in the future. I'm sure Bob would have some nuance to add but it's certainly the group think at SHM these days. So we have two ideas in need of critical examination.
First, have we proven our value by any measure? Bob says in his post:
The point here is that, just as hospitalists took over the world of hospital care because they demonstrated that they could provide high-quality care at a lower cost, the increasing financial pressures that hospitals are under will create, in turn, pressures on hospitalist programs to achieve quality, safety, patient satisfaction, and efficiency outcomes at the lowest possible cost to the hospital...
The reason the hospitalist field thrived was that it demonstrated that it delivered better value than traditional models.
Well, that's debatable. As I've blogged time and time again the evidence is mixed. I'll not rehash it all here other than to say that one of the best and largest studies ever to address this question showed no benefit of the model. It can be accessed on page 25 of this issue of The Hospitalist but as far as I know has never been published in a Medline indexed journal. So it's been tossed down the memory hole and has contributed to the publication bias that has plagued this literature ever since. I'm happy to listen to arguments on both sides of the question but you can't take it for granted that the hospitalist model has been proven superior to the traditional model. There's just not a clean evidential case to be made.
In terms of demonstrating our value to secure our future, how about just showing up? Outside of our ranks fewer and fewer doctors are willing to take care of hospitalized patients. There’s no reason to think the increasingly harsh regulatory environment will do anything other than drive the rest of the non-hospitalists out of the building.
Consider emergency medicine and its parallels with our specialty. Though under the same economic and regulatory pressures as we are you don’t find them crowing about their value. Their emphasis is clinical which is why I have so many of EM blogs linked here. They’re thriving quite well with that singular focus. There are lessons we can learn from them.