Three years ago, Henry Ford Health System began to overhaul how its doctors and nurses care for patients outside the Detroit-based system's six hospitals. Now it must face the economic strains of its own success, as fewer patients turn up to fill hospital beds.
Since January, the number of patients admitted to Henry Ford hospitals has declined 6%, compared with a 2.5% inpatient decline overall in Southeast Michigan; Medicare patients who returned to the hospital within 30 days after discharge fell 19% during the same period. A boom in births has offset fewer patients who need cardiac, pulmonary or kidney care—but only partially.
“We think it's beginning to have an effect,” Dr. William Conway, Henry Ford's executive vice president and chief quality officer, said of the system's broad strategy to prevent hospitalizations. “These things really are working.”
But Henry Ford's drop in inpatient admissions is part of a national trend, and only some of it is thought to be because of care delivery reforms. Hospitals across the country continue to report flat or even declining inpatient growth, a trend that began with the Great Recession, but one that has continued into the economy's sputtering recovery. That slowdown has contributed to record-low growth in U.S. health spending—3.9% in 2009, 2010 and 2011. On the other hand, it has dragged down earnings for laboratory and medical-device companies that supply the healthcare provider sector.
The trends are likely to continue, say analysts and hospital executives, because of the slow U.S. economic rebound; the continued rise of high-deductible insurance plans that constrain medical use; the growth in the number of patients who are held for observation instead of being admitted; and the reforms of payment and delivery models to better coordinate care, improve outcomes and lower costs. The drop in admissions is also related to the U.S. healthcare system's success stories, such as treating heart patients effectively without hospitalization.
“We feel that flat volume is, in fact, the new normal,” said Martin Arrick, a managing director for Standard & Poor's who oversees the rating's agency review of not-for-profit healthcare.