Ambulatory Care Quarterly
Research shows ED case management saves dollars
Update of pivotal study shows cost savings
Researchers are set to release new data confirming the benefits of a case management strategy heralded three years ago as a way to decrease the cost of treating repeat patients in the emergency department (ED). The program first piloted in a California hospital has been used at several others in the interim, and the researchers say the results are encouraging.
The study gained widespread attention in 2000 because it suggested that a system of intensive case management could reduce the financial burden associated with the indigent patients who show up in the ED over and over again. Though many ED managers liked the idea, there was some skepticism about whether the strategy was practical.
Those questions were justified, but the latest data are showing that the plan works, says Alicia Boccellari, PhD, director of the division of psychosocial medicine at San Francisco General Hospital and the University of California, San Francisco School of Medicine.
Boccellari was the lead researcher in 2000 and plans to update the study at the upcoming meeting of the American Public Health Association in San Francisco.
A randomized treatment trial of 300 people has been completed, with two-thirds receiving intervention and one-third receiving usual care. The preliminary results look very strong, she says.
"Our first report was a pilot study, and you always wonder if that will hold up under a randomized trial," she says. "It does appear that the results in the randomized trial are very similar to those in the pilot. Those patients randomized to clinical case management did show the same results: decreased ED visits, hospitalization, and homelessness."
The original study examined the impact of case management on hospital service use, hospital costs, homelessness, substance abuse, and psychosocial problems in frequent users of a public urban ED.1 The subjects were 53 patients who used the ED five times or more in 12 months.
Utilization, cost, and psychosocial variables were compared 12 months before and after the intervention. The median number of ED visits decreased from 15 to nine, median ED costs decreased from $4,124 to $2,195, and median medical inpatient costs decreased from $8,330 to $2,786. Homelessness decreased by 57%, alcohol use by 22%, and drug use by 26%.
Through the case management services, 54% of medically indigent subjects obtained Medicaid. There was a net cost savings, with each dollar invested in the program yielding a $1.44 reduction in hospital costs.
"Case management appears to be a cost-effective means of decreasing acute hospital service use and psychosocial problems among frequent ED users," the researchers conclude.
Since the pilot study, the case management strategy has been adopted at about 10 hospitals across the country, Boccellari says, and two foundations in California recently announced plans to fund more of the programs in that state.
The California Endowment in Woodland Hills and the California HealthCare Foundation in Oakland, two private, statewide health foundations, recently announced the launch of the Frequent Users of Health Services Initiative, a five-year, $10 million program aimed at creating a cost-effective health care delivery system for uninsured Californians.
Melissa Welch, MD, project director for the initiative in Oakland, has had firsthand experience addressing the needs of frequent-user patients as the former chief medical officer for the Community Health Network in San Francisco, which serves the indigent. She says Boccellari’s strategy can be cost-effective.
The Initiative endorses the method as a way for hospitals to save money while improving care for the uninsured, but Welch says it isn’t a project to undertake without a serious commitment. The approach requires a high degree of collaboration between case managers and the ED.
Though the latest data suggest the savings are real, they may not be what all ED managers are looking for, Boccellari points out. There are downsides to consider before jumping in, she says.
Welch notes that because some ED savings are not "extractable," meaning ED visits have decreased but it doesn’t affect the fixed costs of the hospital, it can be difficult to apply those savings to the expense of case management.
Boccellari agrees, saying there is some concern that even if you have a cost offset, it may not appear on the bottom line. "You’re likely to reduce utilization, but it’s not like the hospital is all of a sudden making a profit." Also, this program is very labor intensive, she says. "You need incredibly tenacious case managers who are willing to work with some of the most difficult patients."
It may take six months to see results from the program, but Boccellari says it can help improve morale among ED staff who feel frustrated with seeing the same difficult patients repeatedly. There also is the possibility of direct revenue generation, she says.
"Through this program, we were able to get many of these patients on entitlements so the hospital could bill Medi-Cal and get reimbursed for the care," she adds.
Previously, they had no benefits, and the county had to pick up the bill for all of their care, Boccellari says. "So there can be a revenue enhancement, not just a cost offset," she says.
Reference
- Okin RL, Boccellari A, Azocar F, et al. The effects of clinical case management on hospital service use among ED frequent users. Am J Emerg Med 2000; 18:603-608.
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