Business proposal for IPR

Leslie Burgy, RNSt John Macomb Hospital Health care systems managementLDR 609October 28th,2013

Executive summary

Healthcare is transforming and there will be effects to Inpatient Rehabilitation (IPR) units

Executive summary:Current proposed Medicare reductions to IPR:

Reduction of payment updates for IPRs by 1.1 percentage points beginning in 2014 through 2023

Adjusting the standard for classifying IPR patients that are currently admitted under the designated severity codes from 60% to 75%

Equalized IRP and SNF payments on three conditions: hips, knees and pulmonary conditions

Implementation of bundled payments in 2018 (McCurdy, 2013, para 2).

Executive summary:

There has been a steady decrease in IPR admissions over the past five years changing the average daily census (ADC) from 26 to 19.

Proposal: decrease the number of IPR beds from 30 to 24 with an average daily census of 19.

How: By taking a total of 6 beds or 2 rooms off line and make a nursing associate lounge/locker room and storage room.

Project description and background information:Rationale: Changes in CMS regulations and intense work by the SJPHS

Readmission Reduction team has decreased the overall admissions to the acute care hospitals.

85 % of St John Macomb’s IPR admissions come from within the hospital.

The FY’12 IPR occupancy rate was 59% Decreasing the IPR beds from 30 to 24 and having ADC of

19 would give the unit about a 79% occupancy rate. Research indicates that occupancy rates over 85% have a

negative impact on patient safety and efficiency Compliance with TJC in keeping egresses clear and safe

medication storage Nursing WES statement consistently talk about the

aesthetics of the unit

Risks and barriers:

Current facts: ADC= 19.4 LOS= 10.375 days Two other IPR units in SJPHS which all

provide the same basic services SEMCOG reports decrease in population in

SE Michigan and the population is shifting towards Livingston and Northern Macomb counties

Risks and barriers:

Two competitors within a ten mile area: Henry Ford Health System and Beaumont Health System and both have IPR units

2012 overall market share Beaumont – 19.5 % Henry Ford- 21.4 % SJPHS- 27.8 %

Risk and barriers:

SJPHS Acute Care Asset Team looking at many areas which includes Rehabilitation Services

SJPHS not sure how Rehab services will look in the future but they will be looking at the model of care delivery but it will include systemizing rehab services

St John Macomb physicians not on board with regional department concept.

Risk and barriers:

Considerations of the ACA Bundled payments IPR units reimbursement higher than

nursing home placement. Facilities perspective: Nursing staff keeping personal

belongings (purses) in the med room Halls are cluttered with equipment

Fundamental Assumptions

Must continue to follow the current CMS guidelines for participation

Must maintain and staff a minimum of 10 beds to meet CMS criteria

Qualifying IPR criteria: 60% of the facilities total patient population must meet at least one of 13 medical conditions

Failure to comply with the 60% criteria will decrease reimbursement of the IPR current prospective payment system to that of a critical access hospital

Operations Continue to operate at the same FY’14 budgets for Rehab

Services Needs: lockers, table and chairs and keyless pad entry. Nursing FTEs will remain the same:

Job Title Job Code FTEs

RN 20206 17.00

RN Preceptor 20251 0.90

HUC 30408 1.90

PCT 70764 13.40

CNM 80947 1.0

34.20

Financials:

FY’14 budget will continue to be utilized

Total Operating Expenses for nursing cost center :

Actual: $1,907,999Flexed: $1,921,855

Implementation plan

Room 445 – 2 bed room and room 450 – 4 bed ward will be taken off line only

Room 445 will be made into a nursing associate lounge/locker room

Room 450 will be a equipment storage room

Implementation plan Plan could be implemented within a two

week time period Stakeholders in favor of project: nursing associates, therapy associates, EVS

and facilities departments Stakeholders that are currently neutral or

against project – Macomb physicians Compliance with TJC guidelines

Evaluation criteria

Subjective information from nursing associates and physicians

Decreased work environment statements regarding the aesthetics of the IPR unit

Standing agenda item on monthly IPR Macomb leadership meetings

Exit strategy

If the amount of admissions should have a sustained increase than Room 450, the four bed ward can be converted back to an operable room within 24 hours

References: CMS Manual System, Transmittal 119 Medicare Benefit Policy §

110-2 (January 15th, 2010). Inpatient rehabilitation facility prospective payment system.

(2012). Retrieved from http://www.cms.gov/Outreach-and-Education/Medicare-learning-network-MLN

Jones, R. (2011). Hospital bed occupancy demystified and why hospitals of different size and complexity must run at different average occupancy. British Journal of Healthcare Management, 17(6), 242-248.

McCurdy, D. A. (2013). Obama’s administration’s proposed FY 2014budget includes a $401 billion in health program savings. Retrieved from www.healthindustrywashingtonwatch.com-rehabilitation-facility

SEMCOG. (2012). www.semcog.org Shay, P. D., & Mick, S. S. (2013, January/February). Post acute care

and vertical integration after the patient protection and Affordable Care Act. Journal of Healthcare Management, 58(1), 15-27.