Chicago's Cook County Health and Hospitals System wants to do more than treat the poor and uninsured in its emergency rooms. It wants to provide nursing home care to baby boomers.
The new service aims to extend care to patients after they leave the system's hospitals and, ironically, keep them from coming back quickly. That would save the system money because, under Obamacare, hospitals are fined for readmissions.
“For a variety of reasons, we have not necessarily been the place that a lot of older patients would come to,” says Dr. John Jay Shannon, Cook County Health's CEO. “We'd like to change that.”
Cook County advertised its intent to expand into post-hospital care last month, whether by buying a nursing home or partnering with an outside operator.
Most hospitals don't own nursing homes or even offer the service. Usually such facilities are owned by private companies, and even if a hospital wanted to buy one, there's only a small pool for sale.
“Hospitals don't feel the need to own skilled nursing (homes),” says Jared Landis, a practice manager in Washington, D.C., at the Advisory Board, a health care consultancy. “They feel that they can get the results they want” by controlling which facilities they refer patients to.
Advocate Health Care, at 12 locations the largest hospital network in Illinois, partners with about 40 facilities that treat patients who need care for up to 100 days after a hospital stay. The affiliations have helped reduce readmission rates to 14 percent from 24 percent since 2010, says Denise Keefe, Advocate's president of post-acute care.
New York City Health and Hospitals, the largest public health system in the nation, has owned post-acute care facilities since the late 1960s. The network treats everyone from patients who need a few days of rehab to those who need long-term care after a hospital stay.
Maureen McClusky, New York Health's senior vice president of post-acute care, says that keeping these services in-house allows the network to better track patients with chronic conditions like diabetes or heart disease since their doctors can follow them from hospital to home. Another benefit: It has lifted the system's bottom line because it can participate in insurer programs that reward keeping patients healthy during and after hospital stays.
Cook County Health's initiative comes as it re-evaluates its services. As with many other hospitals across the country, a big part of this shift has been to bulk up its outpatient services, pushed by private insurers and government programs like Medicaid and Medicare to reduce overnight stays and treat patients in cheaper settings. Meanwhile, technological advances like telemedicine make it easier to provide care outside a hospital room.
At Cook County Health—which includes flagship John H. Stroger Jr. Hospital on the Near West Side, Provident Hospital on the South Side and a network of clinics—most patients are uninsured or on Medicaid. Only 14 percent this year are on Medicare, but it has a growing number of patients who will become eligible for the federal insurance program for the elderly once they turn 65. The average patient is 43, but the largest group of patients (38 percent) is 45 to 64 years old.
Doug Elwell, deputy CEO of finance and strategy at Cook County Health, says the system doesn't want to spend lavishly on post-discharge care. That's why it will likely partner with a nursing home rather than buy one. “We believe, without spending a lot of resources, we can significantly improve the care our patients get and our ability to influence the care,” he says. That might even include making a deal with a facility or network for $1 and sharing in future revenue, he says.
For 2014-15, Stroger's readmission rates for Medicare patients with heart failure, heart attacks and pneumonia were slightly higher than those of other hospitals nationwide, but Stroger fared better for patients with chronic lung disease.
Cook County Health now spends up to $19 million a year on nursing home care. While that's just 1 percent of the system's $1.57 billion in 2015 revenue, according to an unaudited financial statement, it's money that could stay within the network.
Nursing homes that want to partner with Cook County Health need to submit their pitches by July 19.
"Why Cook County Health thinks it should expand into nursing homes" originally appeared in Crain's Chicago Business.