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> If you are reducing readmission rates for hospital, especially with respect to certain core measures (and CHF is one of them), you are actually saving the hos

> If you are reducing readmission rates for hospital, especially with respect to certain core measures (and CHF is one of them), you are actually saving the hospital money. And we are not talking nickels and dimes - up to 2% of payment. Yes and no. You are saving the hospital on their readmission penalties, but those currently only apply for three conditions (CHF is one of them). Furthermore, the penalties are not always enough to cover the increased revenue that the hospital gets from the readmission - in other words, some hospitals may actually make a profit from the readmission even when the penalty is factored in. Also, the "up to 2%" is itself complicated. Because of the way the penalty is deducted, other seemingly-unrelated factors (like the patient and insurance demographics of the hospital) have a huge impact on how large the penalty is, even holding everything else constant. > Hospitals can and should be charged for this Currently, even the hospitals that receive the highest readmission penalties are not willing or able to pay (much) money for reducing readmissions. The way their budgets are structured doesn't really allow for this[0]. I say this from experience - my startup also creates a product that happens to reduce readmissions (though this is not our primary goal), and one of the reasons that we emphasize our other (larger) benefits for the hospitals is that most hospitals just won't pay much for a product that reduces readmissions. On top of that, it's also a very crowded space. Health Recovery Solutions is a for-profit company that does more or less the same thing: http://www.healthrecoverysolutions.com/ http://www.healthrecoverysolutions.com/ [0] Yes, it's inefficient, but that's a separate discussion.

dr_ 13y ago
The larger point I was trying to make is really why run this as a non-profit. If I choose to Donate, what am I really donating towards? Am I making a donation towards helping medicare reduce it's costs, because the hospitals aren't incentivized enough to take their job seriously? Or donating for a service that hospitals really should be providing to their clients, whom they are charging? It's not as clear to me, as a non-profit solution, as something like Watsi would be. I'm familiar with HRS, I saw their Blueprint presentation and get their email updates, but should a reason to run a company as a non-profit be because there are already too many for profits in the same business? There may be a number of companies in this space, but this is all still pretty early stage, with no clear winner yet.
- _delirium 13y ago
  Bit of a side point, but the "should this be funded through donations?" and "should it be a non-profit?" questions are slightly different. It's entirely possible to run a nonprofit that funds itself via fees for its services, though it might not qualify as a public charity in that case. For example, many hospitals are nonprofits, and are funded primarily through charging patients & patients' insurance. The hospitals could also buy services from other nonprofits. The nonprofit structure just means they aren't intending to make a profit to return to shareholders, not that they never charge anyone for services.
alphaoverlord 13y ago
Thats actually not true. The readmission penalties make it so hospitals are not paid at all for the readmission.
- chimeracoder 13y ago
  > The readmission penalties make it so hospitals are not paid at all for the readmission. That's the goal, but that's not how it actually works out in practice - look at the details of how the penalties are levied, and you'll see why. If they were implemented perfectly, that would be true. Or if all payers used a bundled payment system, that would be true. But neither of those are the case (at least not now). (An easy way to see this is to see that there is a cap for the maximum penalty - so if the total amount made on readmissions is larger than this cap, the hospital would still make money overall[0].) [0] Of course, nothing can be simple (that would be too easy!), so the actual way that these are calculated is even more convoluted - take a look if you're interested, but don't say I didn't warn you. :)

dr_ 13y ago

The larger point I was trying to make is really why run this as a non-profit. If I choose to Donate, what am I really donating towards? Am I making a donation towards helping medicare reduce it's costs, because the hospitals aren't incentivized enough to take their job seriously? Or donating for a service that hospitals really should be providing to their clients, whom they are charging? It's not as clear to me, as a non-profit solution, as something like Watsi would be. I'm familiar with HRS, I saw their Blueprint presentation and get their email updates, but should a reason to run a company as a non-profit be because there are already too many for profits in the same business? There may be a number of companies in this space, but this is all still pretty early stage, with no clear winner yet.

_delirium 13y ago
Bit of a side point, but the "should this be funded through donations?" and "should it be a non-profit?" questions are slightly different. It's entirely possible to run a nonprofit that funds itself via fees for its services, though it might not qualify as a public charity in that case. For example, many hospitals are nonprofits, and are funded primarily through charging patients & patients' insurance. The hospitals could also buy services from other nonprofits. The nonprofit structure just means they aren't intending to make a profit to return to shareholders, not that they never charge anyone for services.

alphaoverlord 13y ago

Thats actually not true. The readmission penalties make it so hospitals are not paid at all for the readmission.

chimeracoder 13y ago
> The readmission penalties make it so hospitals are not paid at all for the readmission. That's the goal, but that's not how it actually works out in practice - look at the details of how the penalties are levied, and you'll see why. If they were implemented perfectly, that would be true. Or if all payers used a bundled payment system, that would be true. But neither of those are the case (at least not now). (An easy way to see this is to see that there is a cap for the maximum penalty - so if the total amount made on readmissions is larger than this cap, the hospital would still make money overall[0].) [0] Of course, nothing can be simple (that would be too easy!), so the actual way that these are calculated is even more convoluted - take a look if you're interested, but don't say I didn't warn you. :)