Medicare Paradox: Hospitals lose money if patients stay too long, doctors gain money for longer stays

From a New York Times essay: To Curb Repeat Hospital Stays, Pay Doctors

My hospital, like all acute-care facilities, receives a set payment per admission based on the patient’s diagnosis. So the longer a patient stays in the hospital, the more money the hospital stands to lose. Of course, the longer a patient stays, the greater the likelihood of hospital-acquired infections or harm from tests and procedures, which means timely discharge in most cases is good for hospitals and patients alike.

But doctors, paid separately by Medicare, have little motivation to discharge patients quickly. As long as their patients are in the hospital, they can bill and be paid for each visit they make.
I discussed this issue with an internist in private practice, who requested anonymity because of the sensitive nature of the subject. His patients, it seemed to me, were often staying longer in my hospital than necessary.

The solution to this, according to the author, is for Medicare to pay doctors to decrease patient hospital stays, provide better patient follow-ups after hospitalizations, and curb high and unnecessary readmission rates along with the greater likelihood of “hospital-acquired infections.”

Sounds like a prudent plan provided the care of patients who legitimately need longer stays isn’t sacrificed for the sake of more money from the Medicare till.

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