Ignorance: Preventing The High Cost of Re-Hospitalization and Skilled Nursing Stays

By Pamela D. Wilson, The Care Navigator, CSA, CG, MS, BS/BA

According to the Partnership to Fight Chronic Disease, 45% of the United States population is diagnosed with a chronic disease; many individuals diagnosed with multiple chronic diseases. Ever wonder how these costs affect the U.S. healthcare system and the consumer? Individuals diagnosed with chronic disease represent 81% of hospital admissions, take 91% of all prescription drugs and represent 76% of all physician visits. These numbers become more impressive when looking at the cost of Medicare hospital readmissions of $17.4 billion (2004 estimate). The Alliance for Quality Nursing Home Care reports that 17-19% of Medicare beneficiaries are readmitted to the hospital within 30 days and 34% within 90 days.

While the government bears the costs of Medicare, more education is needed for healthcare providers and consumers who also create and bear costs. It’s common knowledge that since health insurance became widely available in the mid-1960’s the true cost of healthcare has been hidden from the consumer because we rarely see the bills. Few consumers ask about the cost of tests or treatments but rather ask about co-pays.

Co-pays should be given more consideration as older adults with multiple chronic diseases find themselves in and out of hospital emergency rooms and skilled nursing communities. The issue – few know or take the time to understand these expenses. Yet it’s exactly these expenses and the related risks to health that force many older adults into nursing homes for the rest of their lives and deplete retirement savings.

Consider these costs:

• In 2012 the co-pay for a Medicare hospitalization inpatient stay is $1156

• If a Medicare consumer is seen in the hospital but not admitted (seen on an outpatient basis) the payment for 20% of medical tests and treatments may exceed $1156, the rate for admission.

• The co-pay for day 20+ in a skilled nursing community is $144.50 per day.

• Emergency transport to the hospital insurance billable $1200 on average, the co-pay about $200

Assuming one hospitalization a year for a Medicare recipient (many have several hospitalizations) and the additional costs of treatments, prescription drugs, etc. the out of pocket costs may reach $2500. Have a second hospitalization? Be prepared to write another big check.

In addition to the hospitalization costs are the practical personal affects. Many hospitalized older adults, including those choosing rehab after the hospital stay, often present with greater physical and cognitive difficulties after the hospitalization or nursing home stay. They are less able to live independently and to care for themselves. Many are unable to manage their present care needs and are oblivious to planning for future needs resulting in a revolving door of hospitalizations, skilled nursing stays and the inevitable inability to care for oneself.

Unnecessary hospitalizations for many Medicare beneficiaries occur because of dehydration,bacterial pneumonia, urinary tract infections and COPD. Few providers – not hospital staff, physicians, skilled nursing communities, home care agencies or others consider or discuss the costs or risks with Medicare beneficiaries because they providers live in the world of services paid by insurance where it’s just as easy to call 911.

Hospitalizations result in a decline in the ability of an older adult to care for themselves and a significant degree of emotional stress and fear about health issues. Medicare does not pay for care oversight and supervision that can prevent these hospitalizations and reduce greater out of pocket costs to consumers. Medicare consumers are unaware of services that can save money and improve quality of life but readily pay hospital co-pays and other medical expenses.

It’s time for consumers to become more educated about options and to take back control of their health. Would you rather pay out of pocket for care oversight and eliminate a hospital stay and the associated risks? Or would you rather pay $2500 to the hospital and risk the need for increased levels of care and watch your retirement nest egg disappear in the blink of an eye because you weren’t aware of your options? The Care Navigator staff works with many older adults and their families to prevent excessive medical costs and unnecessary hospitalizations call 303-810-1816 to learn about your options. Informational videos are available at The Care Navigator

Sources:

Stephen F. Jencks, M.D., M.P.H., Mark V. Williams, M.D., and Eric A. Coleman, M.D., M.P.H. N Engl J Med 2009; 360:1418-1428 April 2, 2009 Americas Health Insurance Plans. Centers for Policy and Research 10/2009. Reductions In Hospital Admission Rates. Partnership to Fight Chronic Disease Fact Sheet

Learn more at my Caregiving Website