Clinical Corner

Role Conflict and the Nurse, Part I

Carol Kleinman — Wed, 08 Oct 2008 14:36:00 GMT

As health care organizations have become more integrated and complex, role expectations among staff have become more diversified. To reduce job dissatisfaction among nurses, managers and administrators need to develop an appreciation for the scope and types of role conflicts that nurses experience as well as the characteristics of nurses who are at increased risk.

Role conflict among staff nurses can originate from: 1) challenges to nurses' value systems in which moral and ethical beliefs are compromised, 2) patient care workloads that exceed nurses' capabilities, 3) multiplex role systems in which the nurse must manage two or more competing roles, for example, the nurse concerned with the patient's best interests but also as an employee who must follow hospital policy, and 4) interdependent relationships in which the nurse must take into consideration multiple perceptions and expectations of others, managers, physicians, case managers, patients, families, and fellow staff members.

Characteristics of nurses at increased risk for role conflict ten to be those who are younger in age, have fewer years in their present staff position, and work in more acute patient care areas. Registered nurses and even nursing assistants suffer role conflict due to differing staff perspectives and patient expectations. It is also clear that poor team or work group relationships contribute to role conflict.

Nurses are at risk for and may experience a variety of types of role conflict during the course of their professional work. While it is unrealistic to anticipate that role conflict can be completely eliminated, leadership behaviors and organizational work processes implemented by managers and administrators can help to reduce this experience.

Nursing Leadership and Education, Part II

Carol Kleinman — Fri, 26 Sep 2008 15:43:00 GMT

Two issues must be considered regarding nurse manager and director role preparation. First, given the importance of the role and the competencies required for success, nursing and health care administrators must support the possession or acquisition of a graduate degree as an essential requirement. A corollary to this imperative is the need to educate current and future nurse leaders about the necessity for this requirement.

Information about the business and nursing administration content typically included in graduate programs-particularly finance, clinical operations, human resource management, and legal and risk management-and the relevance of this content to specific responsibilities, may clarify the need for and benefit of graduate education.

The new health care leadership must possess synthesized competence that includes clinical health services and the management of these services from a business perspective. Nursing/health care administration is a discipline that combines the practice and caring aspects of nursing with the theories and methods of administration.

Nurses both provide care and manage the care environment. To maximize the interaction of these two roles, nurses in leadership positions must be as adequately prepared in the management aspects of the role as they are in the practice aspects.

For a review of the many types of advanced education available, see www.allnursingschools.com or www.petersons.com.

Nursing Leadership and Education, Part I

Carol Kleinman — Tue, 16 Sep 2008 18:19:00 GMT

As health care moves into the new millennium, major changes continue to influence the industry. Structural changes within organizations have moved them from horizontal to vertical and even to virtual integration. Reimbursement changes have led to risk-based fixed-price financing and concerns about their effects on access, quality, and consumer satisfaction. Service delivery has shifted to population-based health and disease management across the continuum of care, made more effective and efficient by outcomes research.

Advances in information systems and information technology have been dramatic. Future advances will be required to accommodate changing government regulations, changing vendor and supplier relations, e-health and Internet data transport, and the acquisition and integration of new business lines. Meanwhile, government's increasing role in health policy and regulation is competing with market-based reform efforts, adding to industry volatility.

The nursing profession has experienced equally radical change during the second half of the twentieth century and the early years of the twenty-first. The domain of nursing knowledge has exploded, scope of practice has increased dramatically, and nursing roles now exist that were unimaginable fifty years ago. The roles of those in nursing leadership have evolved significantly in response to changes in the health care industry in the last twenty years and, increasingly, characteristics for success in the marketplace are based on competencies that require sophisticated business knowledge and skills. While on-the-job training and continuing education are important, advanced education must be seen as essential for those seeking to move up the managerial and administrative ladder.

It is unclear how many nurse managers and directors nationally possess graduate degrees and whether they consider the attainment of such degrees, and the competencies this educational foundation provides, essential for successful role performance. However, the literature is clear on the need for advanced education at the graduate level for nurse leaders.

Some sites on which you can search current literature on the subject are www.nursingcenter.com, www.currentnursing.com and www.nursingworld.org.

Behavioral Medicine, Part II

Carol Kleinman — Wed, 27 Aug 2008 15:33:00 GMT

Why is it effective?

A growing body of research has documented the benefits of behavioral medicine in the treatment of acute and chronic illnesses. The interventions of behavioral medicine include behavioral or psychological strategies, which directly influence physiological states. The methods are best implemented using individual interventions with concomitant daily practice. Clinical experience indicates that patients who use behavioral self-help strategies have better medical outcomes and improved self-efficacy in managing symptoms than those who rely on medical intervention alone.

Outcomes research indicates that patients have improved prognoses and feel more cared for when behavioral medical interventions are integrated into their treatment plans. In addition, behavioral medical consultation-as opposed to psychiatric or psychological evaluation-circumvents patient concerns about being labeled as having a mental health issue or psychiatric diagnosis.

Improved outcomes appear to be based on patients' active participation in treatment, decreased feelings of passivity in response to their illness or injury, and improved perceptions about the probability of recovery of function or quality of life, regardless of actual recovery potential. Family members, who are often included in behavioral medical approaches, find greater comfort with the care received by patients and are aided in their own adjustment to the challenges faced by their loved ones. It has been documented that patients and families often experience a sense of "false despair" that negatively impacts their prognosis when they believe they are powerless to influence health care outcomes.

Who else benefits?

The addition of a behavioral medical professional to the health care team provides several benefits in addition to those experienced by the patient. Physicians and nursing staff find patients are more cooperative and in better compliance with their treatment regimen when behavioral medicine strategies are integrated into the treatment plan.

The facility benefits as there is promising research that behavioral medical interventions may result in shorter lengths of stay, allowing the organization to realize significant savings in prospective payment system reimbursement.

An appropriate use of the model would be to offer a behavioral medical consultation to all new patients as soon as possible after admission so an appropriate set of therapeutic interventions can be identified and implemented.

The challenge of living with a serious illness mandates that health care providers explore all options available to their patients. There is a great deal that can be done to help patients help themselves manage symptoms, improve their quality of life, and promote their well-being. Behavioral medicine can make a significant contribution to a comprehensive treatment approach.

Behavioral Medicine, Part I

Carol Kleinman — Wed, 27 Aug 2008 15:29:00 GMT

What is it?

Behavioral medicine is an interdisciplinary field of medicine concerned with the development and integration of psychosocial, behavioral, and biomedical knowledge relevant to health and illness. It focuses on the contribution of psychological and behavioral factors to the onset, progression, and management of disease. Behavioral medicine deals with what people do that affects their health and the way in which different illnesses affect their behavior.

Behavioral medicine is a discipline that uses a biopsychosocial model to motivate and mobilize patients to greater levels of participation in their own care. Treatment typically involves changing habits. These may involve thought patterns, how one deals with emotions, stress, time management, and their own body's functions. Successful integration of behavioral medicine techniques into a comprehensive treatment plan improves patient outcomes by

Increasing patients' participation in their care
Mobilizing the body's resources for recovery
Creating "learned optimism" by redirecting beliefs and attitudes
Changing negative health behaviors and improving treatment compliance
Reducing the negative influence of anxiety, anger and depression
Increasing patients' sense of control and responsibility for their own health

Who needs it?

Behavioral medicine can be integrated into the care and treatment of patients with a diverse range of conditions; however the approach is most useful with patients with acute or chronic responses to the following conditions:

Cancer
Cerebrovascular disease
Spinal cord injury
Cardiovascular disorders
Cardiopulmonary disorders
Traumatic brain injury
Immune system disorders
Tension and vascular headaches
Irritable bowel syndrome
Sleep disorders
Eating disorders

Patients can also be aided with focused symptom resolution through the use of behavioral medical techniques which are especially useful in the non-pharmacologic treatment of

Pain
Sleep disturbance
Hypertension
Delayed healing
Difficulty with ambulation
Drug regimen side effects
Surgical recovery
Coping difficulties
Depression
Anxiety
Dependence on analgesic medication

Many specific interventions are available as part of the practice of behavioral medicine. Patients must be evaluated individually to assess their current physical and mental state and to identify personal strengths and limitations. A specific treatment plan is then designed that incorporates and capitalizes on each patient's unique response to his or her illness or injury.

Among the techniques that may be used include:

Stress management
Relaxation-rehabilitation exercises
Guided imagery and cognitive-behavioral techniques for pain management
Immune system improvement through guided imagery
Brainwave neurofeedback
Neuromuscular retraining through cognitive rehearsal
Cognitive retraining for depression, illness perception, and anxiety
Hypnosis
Sleep management techniques
Motivational interventions
Thought modification
Problem solving therapy

INtrapreneurship

Carol Kleinman — Mon, 18 Aug 2008 15:47:00 GMT

The word entrepreneur creates the connotation of a business-minded individual who pioneers change, who wants to work for herself or himself, and who organizes, manages, and assumes the risks of a business enterprise.

An intrapreneur is a person within a large corporation who takes direct responsibility for turning an idea into a profitable product through risk-taking and innovation. Intrapreneurism encompasses a variety of concepts: identifying and fostering employees who have what a considered to be intrapreneurial traits, developing an intrapreneurial process for part or all of a business, and developing innovation through rewarding intrapreneurial behavior.

For the intrapreneurial employee, advice abounds. They are advised to be courageous, moderate risk takers, frugal, flexible, and creative about their pathway. Their task is to put together a team of enthusiastic volunteers, build a network of sponsors, and ask for advice before asking for resources.

Gifford Pinchot's out-of print book "Intrapreneuring, Why You Don't Have to Leave the Corporation to Become an Entrepreneur" provides 10 commandments for intrapreneurs:

1. Do any job needed to make your project work regardless of your job description.

2. Share credit wisely.

3. Remember, it is easier to ask for forgiveness than permission.

4. Come to work each day willing to be fired.

5. Ask for advice before asking for resources.

6. Follow your intuition about people; build a team of the best.

7. Build a quiet coalition for your idea; early publicity triggers the corporate immune system.

8. Never bet on a race unless you are running in it.

9. Be true to your goals, but realistic about ways to achieve them.

10. Honor your sponsors.

Online forums that encourage new thinking have evolved, with Fast Company and The Intrapreneuring Cafe being among the favorites. Fast Company has the goal of chronicling the changes under way in how companies create and compete, highlighting the new practices shaping how work gets done, showcasing teams who are inventing the future and reinventing business, and equipping the people exploring this uncharted territory with the tools, techniques, models, and mind-sets they need. The Intrapreneuring Cafe, run by intrapreneur.com, discusses a variety of specific intrapreneurship issues such as what the best businesses are for intrapreneurship and government agency intrapreneuring. They also run want ads for intrapreneurs.

Another direction intrapreneurship is growing is in developing scenarios to anticipate future trends and responses. Scenarios are stories about possible futures which enable organizations to learn, adapt and develop better strategies. Scenario planning begins by identifying the focal issue or decision. There are an infinite number of stories that could be told about the future; the purpose is to tell those that matter, that lead to better decisions. While scenarios to-date have primarily been used for large scale planning efforts for such projects as education in the United States, it is very applicable to the business environment today.

Part 11: Creative strategies for revenue generation: an example

Carol Kleinman — Tue, 12 Aug 2008 17:26:00 GMT

Not long ago, I helped one of our local hospitals develop an enhancement to an existing program. I had been asked to consult with a wound care program from a psychiatric perspective on the relatively high percentage of patients who were noncompliant with their treatment regimens.

I became fascinated with the issue as I wondered why patients would not want their wounds to heal! I implemented a pilot study and gave simple psychological tests to patients, discovering that many were clinically depressed and this is what accounted for their lack of compliance, based on their belief their wounds would never heal. he findings allowed the department to develop an psychiatric intervention component to the program and to bill for services rendered by the psychiatrist and psych NP who began to work with the program.

Can any of you think of a similar idea for generating revenue?

There are many opportunities for money-making ventures that we never think about. Often we are allowing other businesses to make money on our efforts and that represents giving money away. One great example is home health. For years we referred patients to external home health agencies until, one day, someone said, "Why don't we do it ourselves?" and the hospital-based home health agency was born!

Not all new ideas will make money or even have revenue attached to them. Often the new ideas we come up with and implement will serve other purposes. Some will improve patient care significantly, others will save money though not generate any, still others will enhance the image of the organization, while some are "loss leaders" and get people in the door who will then avail themselves of our other services.

Unhappily, generating revenue and making money are not usually considered a bonus. Most of our programs, products, and services need to have positive cash flow and at least some profit margin as the excess of revenue after expense is needed to grow the organization, to support those services that lose money, and to offset bad debt. Nonetheless, making money is a collaborative effort and the "idea" person is just as important as the "implementation" person.

All new initiatives are important to the business-minded nurse leader and there are projects that are important and viable but do not make much money-though certainly most will need at least to break even if you wish to have them supported by administration!

Part 10: More Budget Secrets

Carol Kleinman — Thu, 31 Jul 2008 17:31:00 GMT

Budgets are done initially as computer-modeled projections based on previous performance. What that means is that the computer looks at what was spent and models a budget for the next cycle based on that amount. Thus, if you spend less, you will get less. It's pretty weird, but it reflects the belief that you do not need as much as was allocated.

In the real world, while all budget line items are examined, the greatest focus is placed on staff costs, followed by supply costs. I work very hard to keep those two in line. But for other line items, I have a policy of not only spending every penny, but of going over five to ten percent every year. That is often not enough of a variance in these areas to attract much attention and it allows me to be allocated just a little more next year. This strategy allowed me, over several years, to develop a few subaccounts with money I could use in various ways to the benefit of my staff and the unit. I call this "creative accounting..."

Believe me, I learned this strategy the hard way by being very attentive to budget limits and staying just under budget across the board...only to be allocated less the following year! In general, as managers you should spend up to...and even slightly over...the limit for line items (other than salaries and patient supplies, of course). I even suggested to my managers when I was the CNE (though I deny I ever said it!) that they do so as it helps all the nursing units. Sometimes, there will even be money left over in various subaccounts.

Whether or not you will be able to use the money left over toward something else is a question you will need to find out from your organization. Some allow the transfer of funds from one subaccount to another and this should certainly be explored as it will allow you to spend the money where it is most needed. Even if this is not possible, I would spend all I could on, for example, journal subscriptions, because it will tell your staff you are interested in their growth as professionals. Using the funds for books and creating a unit-based library of reference books is often another way to use subscription funds. There are truly many ways to develop creativity in managing the budget!

In most of my facilities I was able to move money from one account to another through an interaccount transfer and that helped me pool funds for different purposes. I also worked directly with finance to create new subaccounts and transferred money into them from other subaccounts. For example, there was no account for journals and books and I was able to create one so staff could have resource books and current journals available on the units.

Another example was the staff request for new lockers, to which I believed they were entitled to keep their things safe. However, in total the lockers would have cost much more than $1000, putting them in the category of a capital request, which I knew would never be approved. The cost was also more than I could authorize at the time as a nurse manager, as my signing authority was limited to $1000 and my director would have had to approve the purchase, which she would not have done. So I ordered them but used the subaccount of minor equipment (which was for beepers and cell phones and the like), ordering six at a time and doing that every couple of months until everyone had a new locker.

Managers (and even administrators) have spending limits on what they can purchase on their signature alone. Going above that figure requires the signature of a higher-level manager. As I have no interest in bringing some of my activities to their attention, I am always below that number. So, if my limit is $1000, I may have three or four orders for $900. I share this with the vendors and ask for bills or invoices for those numbers and they always comply...they also know the game!

Part 9: The Courage to Lead

Carol Kleinman — Mon, 28 Jul 2008 16:11:00 GMT

As I developed the recent blog entries, I was led to reflect on what is required of our leaders in the current health care environment. It seems to me that so many of those who allege to lead us suffer from a failure or fear to act. I think courage is one of the key elements required of true leaders, though I am not sure how much you will read about it in the literature. I know it is scary, but we must gird our loins and face the demons for the sake of the patients and our staff.

Are all of you ready to do that?

You might be interested in what I was able to come up with in the literature on the subject of courage in leadership. I think courage and a willingness to take risks instead of playing it safe is a key characteristic of great leaders.

-Clancy, T. (2003). Courage and today's nurse leader. Nursing Administration Quarterly, 27, 128-132.

-Hader, R. (2007). Leadership anxiety? Choose courage over complacency. Nursing Management, May, 6.

-Fifer, J. (2006). Courage in leadership: like a long distance runner? Healthcare Financial Management, November, 32.

-Fifer, J. (2006). Courage to lead in the revenue cycle. Healthcare Financial Management, September, 200.

Thinking about courage in leadership led me to reflect upon how management/administration is viewed by the rank and file. So often, administration is regarded with suspiciousness and doubt as staff believe they are not being told everything and think there is a hidden agenda that explains management's actions. However, once we are on the other side of the fence, it is so much different. Of course I would prefer transparency, just as I prefer complete honesty in personal relationships. But we all know that we must balance such honesty with tact and compassion. If we said everything we thought and felt to our spouses, significant others, parents, children, and friends...we would likely be voted off the island! The same is true for openness and honesty in management. How do we balance openness with the need to know? What if I need to be deceptive, but for a good reason?

Part 8: Developing New Services

Carol Kleinman — Tue, 08 Jul 2008 17:43:00 GMT

One of the important ways we evaluate ideas for new products or services is through a market and SWOT analysis, something you did last term in your portfolio assignment. Someone suggests something they think would be a great new product or service and then we go out and evaluate it.

In my last executive position the med-surg nurse manager suggested a unit comprised of all private rooms, with custom menus and chef-prepared food, better furniture, cable TV and movies, etc. She wanted to call it the Garden Suites. No one thought it would ever fly as our hospital had a huge percentage of charity cases, Medicaid, etc. However, an analysis was done and we built the unit which remained almost 100% full all the time! People will pay out of pocket (if they have the resources) for more nursing care, a nicer environment, better food, etc. I was amazed!

Does anyone have a story about a similarly surprising venture?

Part 7: Thoughts on Budgeting

Carol Kleinman — Thu, 19 Jun 2008 15:40:00 GMT

The operations budget, while based in part on expenses, is also based on revenue projections. Clearly we would not knowingly budget to spend more than we expect to earn from a product or service and so we budget accordingly. In general, we do not expect to have a great deal of money left over from revenues received after deducting all the operating costs, i.e., the costs of providing services. What we do have left...and it is usually a very small percentage...we do not leave in operations accounts, we move into an account that contains all the positive balances from various operations.

Essentially, capital budget funds come from these assets, ones that are left in the organization after all expenses are deducted. This includes not only operating expenses, but such expenses as depreciation, interest paid, taxes, etc. What is left is usually a pool of money call unrestricted net assets as we can do what we wish with them, up to a point. What is generally done is that the funds are used to replace outdated major equipment, expand existing services, and develop new product lines.

So, we expect operations to pay for themselves through the revenue we generate and we use the resources left to continue to grow our operations. We do this for various reasons. Sometimes we simply do this to remain competitive. In one place I worked, the L&D area was dismal, old and un-renovated, and no one care because most of the mothers were Medicaid recipients. Then another nearby hospital opened a state-of-the-art LDRP center and all the Medicaid moms went there. Despite the fact that the revenue was low on a per-patient basis, losing ALL of it was a blow. My hospital had to create an L&D area that was just as up-to-date in order to regain market share. Similarly, if we want to keep our primary referral sources, usually physicians and payers, we need to have the kind of environment and equipment they expect.

I wish we could allocate those funds back into operations and add to staffing ratios and so on, but you will find other compelling realities exist in the executive offices that require senior administration to make some difficult financial decisions.

Do you feel ready to do this?

Part 6: Management Tip - Staff Buy In

Carol Kleinman — Thu, 05 Jun 2008 20:24:00 GMT

One of the things I had ongoing on all my units was a wish list in the staff lounges on which anyone could put a request for something they wished to have purchased. I always did my best, at every administrative level, to acquire as much as I could of what staff wanted and needed. It is one form of support for their efforts that recognized their value.

One of the most interesting things to me about this strategy is that staff did not ask for raises or longer breaks or fewer patients, which I could not grant. They asked for things like reference books, lockers (that could actually lock), educational classes about clinical topics, a water cooler, and so on. These things required little money and made a huge impact as I was the first director who had every asked what they wanted or needed and then provided them with their requests. If affirmed their value and let them know I was listening and really cared.

Part 5: Creative Accounting

Carol Kleinman — Tue, 13 May 2008 16:23:00 GMT

I thought I would confess one of the strategies I employ in dealing with difficult-to-acquire capital items, something I call "creative accounting." As all of my experience has been in behavioral health operations, it was always been clear to me that providing the best equipment for the mentally ill has never been a priority in most hospitals.

In my last administrative position, the unit was old, the furniture was broken down (when the unit first opened the furniture had been acquired from the warehouse of discarded furniture with the belief that there was no point in providing decent furniture to patients who would not appreciate it or who would destroy it), and the floors in terrible disrepair. There were no supplies, no recreational equipment, and the whole environment was pretty sad. The nurses were still using thermometers with probes while every other unit had the ear thermometers. My nurses were still taking manual blood pressures while all the other units had electronic ones that operated automatically. All the other patient care units had a Pyxis machine for medication administration but we still had a rickety cart with wobbly wheels and drawers that wouldn't open or would fall out. The list could go on and on.

I requested capital funds year after year and was turned down. But because I spent just over the limit in every line item-other than salaries-each year I got a little more allocated for that line item in the budget. One of the line items was for repairs to materials and equipment, but this could not be used for replacement as that would be a capital expense with depreciation over several years while repairs were simply expensed out each year. So one year I "repaired" the floor. The whole floor. Three feet at a time. Continuously...until it was all new. If I had been questioned I simply would have said the floor was in such disrepair that I just kept repairing the parts that were dangerous and might trigger patient falls.

Another example I will share was cited in a book published by Sigma Theta Tau called "Ordinary People, Extraordinary Lives." It is a book about inspirational nurses whose personal stories were written by someone whose life the nurse impacted. I am honored to be one of the nurses included in this book and I will post to document sharing the story that was written about me by one of my graduates. That story, too, describes an example of creative accounting and how I used it for the benefit of the patients for whom I was responsible.

One of the most valuable things nurse managers and administrators can learn is how to find "workarounds" to solve problems that are caused by the often-rigid structures and policies within our organizations.

Both stories illustrate one of my mottos: "I would rather ask forgiveness than permission." I did what I needed to do for the patients and did so creatively. Does anyone have a similar story?

When I reflect further on "creative accounting" and tried to think of more examples, I first thought I would share my personal accounting activities in which I rely on the famous "float" so I use more of my money than the bank does, but then I realized the IRS might read the post and notice and I would have to finish my postings from a Federal prison...

Seriously, part of the strategy has to do with willingness to engage in risk-taking behavior. As you become more experienced, you begin to develop a sense, quite frankly, of what you can get away with in the system and which activities are too far below the radar to get anyone's attention.

Part 4: Reimbursement of Costs…ALL Costs!

Carol Kleinman — Tue, 29 Apr 2008 17:21:00 GMT

When nurses begin to learn about the difference between cost for an item and the total cost for everything involved in supplying the item they are often upset to learn that there indeed may be a charge of $12 for a simple aspirin. Most see it as health care facilities having "marked up prices" when there are, in fact, the only way we can cover other costs associated with providing care for which we cannot be reimbursed.

What we do when we develop charges is try to determine all the costs associated with the service or item, and there are many. We then develop a charge consistent with the total amount. Thus, these are not inflated charges, but rather a reasonably accurate determination of all associated costs.

We are often reimbursed an amount less than what we charge and there are Generally Accepted Accounting Principles (GAAP) that determine how we handle the difference. Typically this is done through including a contractual allowance that is a deduction from the gross revenue we "book" or enter into the ledger. If we enter only the amount we receive, we will not capture the actual charges and not accurately reflect the discount we gave to the payer.

The only way we collect money in our facilities is to charge insurers for the actual care we provide to the patients who are their members. This includes tests, treatments, etc. But far more is included in the costs of running the facility than just those elements that are part of the direct care of patients.

For example, how do you think we are paid for the laundry we use in patient care and other activities? How do we get paid for the security guard who ensures staff and visitor safety? What about the people in payroll who process our paychecks? And the medical records people who maintain patient records even after they are discharged? Do you think we bill the insurer for these services? Do you think they would pay? Do we just absorb all these costs?

When considering accruals for all costs, we must also add to the cost of supplies a portion of the salary for the person who orders them, the individual who unloads them from the truck and places them in storage, and the person who delivers them to the unit. Then there is the cost of maintaining the inventory so the hospital never runs out of them and the cost of the people who review the bills for them, process the account payable, input the payment information into the general ledger, and someone to actually cut the check and put it into an envelope and mail it! Oh yes, and the postage...

While we add up the costs of doing business, we also have significant economies of scale that allow these costs to be spread over many items and payers so that, if we run our operations efficiently, the average of what we are paid covers our actual costs...and a little more. For example, if we are paid $25 for a bag of IV fluid, that may actually include $5 for the cost of the nurse who hangs it. But she is also hanging several other IV bags for several other patients whose payers are also paying $5 for it. In the end, we make enough from the volume of payers to cover the cost of both the IV fluid as well as the nurse. If you add to that the payers who pay, say $55, there is additional revenue to cover the cost of the nurse.

Ultimately, payers must reimburse us for the cost of all supplies and operational costs. This can be done as when we charge for each item as it is used, when we bundle charges and include it in the cost of a procedure, or it may be included in a per diem charge for a day's care (or another unit of service). Inevitably, everything we use for patient care must somehow be reimbursed to us or we are giving it away and, even for an item as inexpensive as a needle lock syringe, it would undermine our success as a business.

We are often using supplies that, individually, cost very little. But multiply cost by volume and a $1 item becomes $1000 a month, conservatively. We are constantly looking for ways to maximize our reimbursement while cutting costs. It is clear we do not even get reimbursed for all the actual costs of the care we provide, let alone achieve the surplus of funds that might be called a profit. What happens is that those patients with better insurance, for whom we get better reimbursement, carry the burden of the patients for whom we are paid less than the cost of their care.

Part 3: Fiscal reality and length of stay

Carol Kleinman — Fri, 18 Apr 2008 16:07:00 GMT

As I reflect upon the massive changes in health care in the last couple of decades, one of the most profound relates to our focus on length of stay and the ever-present need to reduce hospitals stays until they are so short I wonder sometimes how patients can be adequately treated in such short time frames. If we examine readmission rates, we find they have gone up and I wonder if they are proportional to the decreases in length of stay so we could assume an inverse relationship. Inevitably, this emphasis has found its way into long term care as fewer and fewer days are provided to residents, most of whom cannot fund their care out-of-pocket.

In some ways I wish we could return to an earlier model in which patients were kept in the facility until they were truly better. In other ways, I know this is not only impossible, it is undesirable. And, as the cost of care continues to escalate due to costs of medication, expensive technology, increasing salaries, etc., it would be impossible. In actuality, I think the quality of care has improved significantly as we are now required to be very attentive to how we use increasingly scarce resources. That has resulted in the need to provide patients with what they need when they need it and to reduce waste in terms of time and activities that do not make a difference.

Case management has allowed us to do this and to focus far more closely on the real needs of the patient. To this we have added our awareness and understanding that complete healing does not need to occur in acute care facilities; this has allowed the development of skilled nursing and rehab facilities, LTACHs, and other creative care environments, as well as an enhanced role for families in the care of their ill or injured member.

I remember years ago when my father had gall bladder surgery and was in the hospital for three weeks! Did he really need to be there all that time? No, of course not! And let us not forget the untoward consequences of overlong hospital stays...