An extra hospital day lowers readmissions, costs

It sounds counterintuitive, but hospitals may save money by waiting a day before discharging heart failure patients. One more day in the hospital also reduces death from MI and pneumonia, according to a report published by the National Bureau of Economic Research.

Penalties for higher-than-expected 30-day readmissions for heart failure, MI and pneumonia have motivated hospitals to initiate outpatient interventions. Those interventions carry costs and may challenge hospitals once the patient is outside their sphere of control, though.

Ann P. Bartel, PhD, chair of the economic subdivision at Columbia Business School in New York City, and colleagues looked for practices within a hospital’s control that might reduce readmissions. They focused on length of stay, reasoning that the extra time allowed patients to stabilize and become better educated about their condition, warning signs and best practices once they are discharged.

For their analysis, they compared gains in readmissions and mortality made by the inpatient change to longer stays with outpatient programs. They used an instrumental variable method and Medicare data from 2008 to 2011, comparing traditional fee-for-service beneficiaries with patients insured under the capitated Medicare Advantage model.

For severe heart failure patients, adding a day in the hospital cut the risk of readmission by 7 percent. Switching fee-for-service heart failure patients to Medicare Advantage dropped readmission risk by 7 percent as well, making the two approaches comparable.  

Cost effectiveness depended on how a day in the hospital was priced. “Assuming an effective incentive for hospitals to take action exists, our findings suggest that it may be more cost effective for hospitals to increase patient LOS [length of stay] rather than invest in outpatient programs,” they wrote.

Keeping acute MI and pneumonia patients an extra day didn’t alter readmission risk but it did lower mortality risk by 7 percent and 22 percent, respectively. For fee-for-service acute MI patients, an extra day in the hospital saved 2,577 lives while switching them to Medicare Advantage saved only 515 lives. A similar pattern was seen for pneumonia patients.

“Under reasonable assumptions, we find that the value of those saved lives would exceed the cost of the inpatient intervention,” Bartel et al wrote. The results don’t apply to elective cases, they pointed out.