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Medicare Rule May Needlessly Extend Some Hospital Stays

Minimum-stay requirement dates to 1960s

A decades-old Medicare rule requiring a 3-day hospital stay before patients can transfer to skilled nursing facilities may needlessly prolong hospitalizations, according to a Reuters report. 

Researchers compared the average time patients were hospitalized between 2006 and 2010 in privately administered Medicare Advantage health plans that either followed this rule or allowed people to transfer to skilled nursing facilities sooner. The lengths of hospital stays increased with the rule in place and declined when it was waived, the study found.

“The three-day stay rule may inappropriately lengthen the time spent in a hospital for patients who could be transferred to a skilled nursing facility earlier,” senior author Dr. Amal Trivedi, a health policy researcher at Brown University, told Reuters.

This minimum-stay rule dates back to the 1960s, when patients typically remained in the hospital for nearly 2 weeks, and 3 days was the minimum time needed to evaluate them and plan their post-hospital care, Trivedi and colleagues note in Health Affairs. Since then, typical stays have shortened, and skilled nursing facilities have become an increasingly common treatment setting for patients with complex medical problems who no longer require acute inpatient care.

To see how the 3-day minimum stay requirement might affect hospitalization, the researchers compared the typical number of hospital days for nearly 141,000 patients in 14 Medicare Advantage plans that upheld the rule and for nearly 117,000 people in 14 similar plans that waived it. The people enrolled in plans that waived the rule were typically younger, poorer, and less likely to be white.

For plans that waived the rule, 23.5% of hospitalized patients were admitted to skilled nursing facilities in the year before the rule was eliminated, compared with 25.7% in the year after it went away. Plans that kept the rule saw a similar gain, from 22.8% to 26.3%.

But the average length of hospital stays for patients in plans that waived the 3-day rule declined from 6.9 days to 6.7 days, compared with an increase from 6.1 days to 6.6 days in plans that kept the requirement in place.

Overall, the average reduction in hospital stays was 0.7 days when the rule was eliminated, translating into approximately $1,500 in savings for every admission that ended with a transfer to a skilled nursing facility, the researchers estimated.

One limitation of the study, however, is that it looked at hospital days over the entire year, rather than the number of days for each stay, the authors acknowledged. It’s also possible that the cost savings wouldn’t be the same for people with traditional fee-for-service Medicare or other plans unlike the ones in the study.

Even so, as hospital stays become shorter and patients with complicated illnesses are treated in other settings, it makes sense to revisit whether 3 days is the right cutoff to identify people who can appropriately transfer to a skilled nursing facility, according to Dr. David Grabowski, a health policy researcher at Harvard Medical School.

Certain patients may also benefit from leaving the hospital sooner, because longer stays can increase their risk of infections and make it less likely that they get out of bed for physical activity that can aid recovery, Grabowski, who wasn’t involved in the study, told Reuters. 

“Some individuals with short hospital stays may be inappropriately excluded from skilled nursing facility care under the current system,” he said. “Moreover, this rule has led to some unintended consequences, like the growth in observational stays. There really aren’t many benefits to staying beyond medical necessity.” 

Sources: Reuters; August 4, 2015; and Health Affairs; August 2015.

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