Healthcare News & Insights

Are quality improvement programs really lowering costs?

Hospitals are doing all they can to lower their costs. One way they’re doing this is by using quality improvement programs to prevent readmissions. And while they are having success at lowering readmissions, a new study shows the cost-savings aspect isn’t always there. 

A Cedars-Sinai-led team of investigators systematically evaluated the effectiveness and financial benefit of quality improvement programs at medical centers in the U.S. and elsewhere.

The study, published in the Journal of the American Medical Association Internal Medicine, included a systematic review of data from 50 quality improvement studies involving more than 16,700 patients. What the researchers found was while quality improvement interventions reduced readmissions by an average of 12.1% for heart failure patients and 6.3 % for older adults with diverse heath issues, savings to health systems varied.

Led by Teryl Nuckols, MD, MSHS, the investigators looked at how much money the interventions saved or cost health systems by measuring expenses for hospitals, physicians and other providers and payors. What they found was the average net savings for heart failure patients was $972 per person for health systems, and for other patients the average net losses was $169 per person.

Unfortunately, because costs varied so widely across studies, the researchers couldn’t make a definitive conclusion whether lowering readmissions interventions actually saved or lost money.

Interventions with most savings

Where the researchers found the most net savings per patient was among older adults that had interventions that engaged them and their caregivers. This included interventions where nurses or pharmacists trained patients and their family members how to manage medications after discharge, what type of activities the patient could participate in and symptoms that might indicate something serious.

Since it’s believed by many that readmission interventions save hospitals money because they prevent additional hospital stays, the researchers were surprised the results didn’t save more money across the board.

“Hospitalization is very expensive, so avoiding even a few readmissions should have saved a lot of money,” said Dr. Nuckols, director of the division of general internal medicine in the Cedars-Sinai department of medicine. “Our findings suggest that there is no guarantee of net cost savings once the implementation costs associated with efforts to prevent readmissions are considered.”

This is an important finding since the Centers for Medicare & Medicaid Services now penalizes hospitals for excessive readmissions. As it stands, the Advisory Board – a healthcare consulting and research firm – did an analysis of government data, and 2,600 hospitals are expected to lose more than $500 million in payments this year.

What you can do

To help you out, a study by researchers from Yale University, which was published in Circulation: Cardiovascular Quality and Outcomes, identified six evidence-based strategies to reduce 30-day Medicare readmissions by 2%:

  • partnering with local physicians and physician groups
  • collaborating with local facilities to develop consistent readmission reducing strategies
  • assigning nurses to manage medication plans
  • scheduling follow-up appointments for patients pre-discharge
  • following up with patients post-discharge with test results, and
  • developing a post-discharge plan with the patient’s primary care physician and sharing medical record.

You may want to look at your readmissions data to see which interventions are saving you the most money and revamp those that aren’t reducing costs.

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