The Economics and Reimbursement of Congestive Heart Failure

Abstract

Healthcare in the US hospital setting has undergone immense evolution over the last two decades. Spiraling healthcare costs led to efforts by payers to rein in charges by providers and facilities. Managed care became the mantra for managing costs through use of guidelines: evidence-based best practices, contractual negotiations, and the utilization management review process. Perhaps the most challenging financial change for the acute care facility was the development of the DRG-based payment system for Medicare recipients. No longer able to benefit from long hospital stays filled with a litany of billable tests and procedures, the hospital was faced with an urgent need to become efficient.

The acute decompensated heart failure (ADHF) patient poses additional challenges for the hospital facility. Such patients are resource intensive utilizers of hospital services and can often result in a net fiscal loss for the average hospital stay. Using evidence-based treatment approaches for appropriately selected heart failure patients in an observation unit can result in improved clinical outcomes, enhanced quality of care, and a positive impact on financial margins.

As payers shift to value-based reimbursement and global episode of care reimbursement patterns, an already challenged hospital delivery system will be forced to alter the care delivery model. Hospitals will have to merge quality and financial objectives into a viable operational plan in order to survive the upcoming external forces in the evolving healthcare environment.