A reimbursement lesson is in order as Medicare changes raise ICU payments
Department budgets, staffing levels may benefit from shift to managed care
For most hospitals, managed care just got bigger. As Medicare phases in a sweeping managed care plan, some critical care nurses are advocating a greater participation by colleagues in reimbursements — a move that could directly affect department budgets and staffing levels.
Recent changes in the taxpayer-financed health insurance program establish a new way to pay hospitals for everything from nursing care to X-rays. For hundreds of providers nationwide, the difference will mean potentially millions of additional dollars in reimbursements.
Insurance payments are something that nurse managers and their staff have traditionally left to others, says Sandra Swanson, RN, MSOD, nurse manager of the neonatal intensive care unit at The Ronald McDonald Children’s Hospital in Maywood, IL. But the changes in Medicare, which are already being felt by hospitals, will affect the financial picture for resource-intensive units such as critical care.
Most insurers and managed care organizations (MCOs) know a great deal about general surgery and medicine, but they know virtually nothing about what occurs in a critical care unit, Swanson says. Yet, these same payers determine reimbursement contracts that affect how much your hospital will be paid. In turn, those amounts influence nursing budgets in critical care and how many staff and technicians you are allowed to retain in your department, she adds.
Nurses such as Swanson stop short of suggesting that ICU managers get involved in billing or contract negotiations. However, managers should have a practical knowledge of how the managed care system works, Swanson observes. If they can play even a small role in helping a hospital’s financial outlook, the effort ultimately will benefit their ICUs.
In the process, they may learn exactly why they face such pressure to get patients in and out sooner and improve their performance on readmissions and length of stay, she adds.
A process of self-education
A few years ago, Swanson made the effort to educate herself, reading everything she could find on managed care. Her reading list consisted of business journals, health industry publications, and the daily press.
"I felt that nurses needed to take the initiative, to understand the basis for all the complaints about managed care," Swanson says.
One discovery she made early was that hospital and payer groups know very little about each other.
Traditionalists stick to the belief that nurses should stay out of reimbursements. The underlying fear is that an involvement in payments will diminish their primary focus, which is patient care, says Patricia Johnson, RN, MS, a nurse practitioner in Phoenix. Until recently, Johnson served as interim executive director of the National Association of Neonate Nurses in Chicago.
"The health care system is geared so that nurse managers are held accountable for costs, not reimbursements," Johnson adds. As a result, critics of the situation say nursing administrators are getting only half the picture regarding hospital finances.
Swanson makes clear that hospital administrators don’t deliberately keep nurses in the dark. It’s up to nurses as individuals to do more to keep pace with managed care. "If they don’t, who will?" Swanson asks. (See story on increasing your knowledge of managed care, p. 63.)
The Health Care Financing Administration must have asked itself the same question. Over the past three years, the agency, which administers the Medicare and Medicaid programs out of Baltimore, helped Congress amend the federal Social Security Act (via the Balanced Budget Act of 1997) and set in motion Medicare’s transition into a full-blown managed care system.
Health care policy wonks have described the change as something of a quiet revolution. The changes aren’t likely to affect the clinical aspects of care rendered to ICU patients. "Despite years of complaining, managed care has brought more discipline to patient care," Johnson acknowledges.
The Medicare reimbursement changes will directly affect the bottom line for ICUs. According to Johnson, in a system rife with flawed, inconsistent data, wouldn’t it be nice to know that the hospital is getting properly paid? (See story on changes in Medicare on p. 64.)
Johnson echoes the sentiments of other veteran nurses: "No one at any hospital I know seems to know what is going on in reimbursements," she says. "There are people issuing bills who have no idea what they are billing for."
Government cracks down on alleged fraud
Indeed, the number of claims issued for services that were never rendered or improperly billed has triggered federal investigations. Since 1995, more than 500 hospitals have been accused and fined for allegedly over-charging Medicare. In most cases, human error — not intentional fraud — was to blame.
The nursing profession as a whole is trying to become a bigger participant in managed care. The American Nursing Association in Washington, DC, has a working group on Medicare, which drafted its own plan for Congress to save the system.
Some nursing schools may be ahead of the trend. In 1995, The University of Nebraska Medical Center’s College of Nursing in Lincoln introduced managed care principles to its Bachelor of Science degree curriculum.
The training focuses on clinical aspects of patient care in a managed care environment, but it signals a beginning in effective, cost-conscious nursing care, says Kathleen Duncan, RN, PhD, assistant professor of nursing.
The exposure involves two semesters of course work and activity training in a variety of managed care subjects, including patient classification systems in acute and post-acute phases of illnesses, critical pathways, and patients-as-customers strategies.
The training, dubbed The Continuum of Care Experience, helps future nurses develop critical thinking skills by making them "active participants in their learning" about managed care, according to a 1998 study of the program published in the journal Nurse Educator.1
"Nurses don’t need to get involved in billing issues, but they should be introduced to managed care financing," says Duncan. "You can’t work in health care today and not be at least concerned about the economic viability of your unit."
Reference
1. Duncan K, Campbell-Grossman C. Creating clinical opportunities in a managed care environment. Nurse Educ Nov-Dec 1998; 23(6):42-47.
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