Capitated hospital cuts prematurity, saves big
Managed care can upgrade neonatal health
To some, capitation may seem like an ill wind blowing through the health care system, but one New Orleans-based hospital has managed to save millions of dollars by reducing the number of patients giving birth prematurely and thus reducing the number of days infants spend in neonatal intensive care.
The Ochsner Clinic is one of the few vertically integrated managed care systems in the United States, with its own health plan that covers 150,000 lives. Plan managers decided full capitation would bring down costs.
"If you have an incentive that says, We’re going to pay you X amount of dollars up front, and we don’t care if you don’t take care of any patients the whole year you can go out and play tennis and golf’ that’s incentive!"says Jay Goldsmith, MD, chairman of the department of pediatrics at the clinic.
The goal of a capitated neonatologist, then, is not "he who has the most bassinets wins," but reducing poor health outcomes and thus reduce time spent in the hospital, Goldsmith explains. Ochsner changed its outcomes by targeting the prematurity rate. The idea was to do everything possible to stave off birth for 48 hours, long enough for steroids administered to the mother to mature the fetus’ lungs. Goldsmith explains that 48 hours of steroids will result in less time for the baby to spend on a ventilator, less respiratory disease, less incidence of brain hemorrhage, and shorter lengths of stay.
High-risk moms were identified by three main factors: hypertension before pregnancy, multiple gestation, and a previous premature birth. Those women then were brought under close surveillance they stayed in a converted hotel the hospital purchased next door and tocolysis (the stopping of labor) was begun as soon as possible to get 48 hours for the steroids to work. The results? Here are a few outcomes:
• The national average for low birth weight babies is 7%; Ochsner brought that down to 5%. Similarly, Louisiana’s average for very low birth weight babies is 1.9%; Ochsner’s is 0.6%.
• The national average for brain hemorrhage in premature babies ranges from 25% to 50%; Ochsner’s is 12%.
• Days spent in neonatal intensive care per 1,000 births changed from about 2,400 days per year to about 600, a 75% reduction. At $2,000 to $3,000 per day, that is a savings of $3.6 million to $5.4 million.
Targeting the prematurity rate and following high-risk moms has helped other hospitals cut costs. Karen Kramer, MSHA, director of the Women’s Center and Breast Care Clinic at Cox Health Systems in Springfield, MO, points out that the hospital’s Healthy Starts prenatal program has reduced the prematurity rate as well. Consisting of three components early identification of high-risk moms, education, and case management for those at high risk the program has lowered the once 11% prematurity rate to 6.7%, she says.
"When you consider that even one premature baby can cost $50,000, it’s easy to see why programs targeting the prematurity rate are so significant," Kramer says.
While a 5% or even a 6.7% prematurity rate is nothing to sneeze at, Goldsmith says some countries, such as Japan, have rates as low as 0.35%.
"We’re not sure why [the rates are lower], he notes. "Are they just healthier reproducers, or are we just not paying attention to the preventive aspects of such a common thing as pregnancy?"
For more on reducing prematurity risks, contact: Jay Goldsmith, MD, Chairman, Department of Pediatrics, Ochsner Clinic, 1514 Jefferson Highway, New Orleans, LA 70121. Telephone: (504) 842-3900. Fax: (504) 842-3041. Karen Kramer, MSHA, Director, Women’s Center and Breast Care Clinic, Cox Health Systems, 3801 S. National, Springfield, MO 65807. Telephone: (417) 269-4663. Fax: (417) 269-6251.
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