Long-term acute-care hospital operators can rest easy now that the Medicare Payment Advisory Commission has rejected a proposal that Congress place a moratorium on the development of new long-term acute-care hospitals within existing hospitals.
With the goal of targeting long-term acute-care hospital care to the appropriate patient population, the commission further unanimously approved two general recommendations focused on defining long-term acute-care facilities and monitoring the medical necessity of the care they provide.
Although expected, the proposal to enact a moratorium on development was opposed by several commissioners and, as a result, was never brought to a vote. MedPAC Chairman Glenn Hackbarth rejected the call for the proposal, calling such a move "premature."
"The decision not to recommend the moratorium is the proper thing to do," said James Cullen, president and chief executive officer of 99-bed Gaylor Hospital, a free-standing long-term acute-care facility in Wallingford, Conn. "Moratoriums are short- term and they're not productive."
While certain commissioners were concerned with swift growth of the industry, it was unlikely that MedPAC would adopt a recommendation as harsh as a moratorium, even though there had been discussion on the subject, said Malcolm Morrison, president and CEO of healthcare consulting firm Morrison Informatics.
"It is rare that restrictions of that magnitude are imposed because it could damage access to care," he said.
At last week's MedPAC meeting, commissioners also approved two nonbinding recommendations that are expected to be included in MedPAC's June report as formal recommendations to Congress.
To clearly distinguish long-term acute care from other settings and hold providers accountable for providing high-quality care, the first approved recommendation is designed to better define the facilities and the clinical complexity of their patients through a list of facility and patient criteria. Facility criteria include staffing, patient evaluation and review processes, and patient mix, while patient-level criteria include admission and discharge, clinical characteristics and categories of conditions. The criteria are based on feedback from industry providers and MedPAC's research over the past couple of years and are designed to ensure that patients treated in settings other than general acute-care hospitals belong there.
The second approved recommendation increases funding for quality improvement organizations that would be required to conduct reviews of long-term acute-care admissions to determine and monitor medical necessity during the patient's stay.
Long-term acute-care hospitals, which care for medically complex patients and receive significantly higher Medicare payments than general acute-care hospitals, are rapidly spreading. According to MedPAC, there were 318 long-term acute-care hospitals operating in 2003, up from 105 in 1993. Medicare spending on such hospitals grew to $1.9 billion in 2001, up from $398 million in 1993.
It is unclear whether the recommendations could be implemented without legislation and how soon the changes could go into effect.
"MedPAC proposes but Congress disposes," said Alexander Vachon, president of Hamilton PPB, a Washington consulting firm specializing in public policy, legislative and regulatory matters. "Politically Congress would need to act on this issue."
Vachon said it's unlikely that the issue would see any action from lawmakers until next year at the earliest and that even then, the CMS would need to provide Congress with a specific proposal.
To be considered a long-term acute-care hospital, the facility must only prove it has a 25-day average length of stay, a "pretty undemanding" threshold, Vachon said.
Morrison said that overall, while critics continue to make statements concerning the overlap of patients, MedPAC's recommendations were an endorsement of the industry.
"They've tried to identify the most appropriate patients for the facilities, and there will be further refinement of criteria," he said.
-with Jeff Tieman