Outcomes Count for Patients and Care Managers

by Stefani Daniels
Published on May 24, 2016

Being a nationally recognized center of medical excellence doesn't mean that a facility is operationally sophisticated. In fact, its just possible that a hospital's clinical reputation provides enough hubris to deny that operations are behind the times.


During a recent phone call, I discovered that  one of the most elite medical centers in the country is still using the 1980s functional model of hospital case management.  Despite a lively discussion about best practices in contemporary case management practice, there was little interest in changing anything about their current program. In fact, it was quite evident that even in the face of overwhelming care manager vacancies at this facility, examples of how many hospitals are transforming their case management programs did not pique their curiosity.

The outdated functional model used at this facility appeared after the financial free fall following the introduction of the prospective payment system.  Hospitals that didn't go bankrupt, weren't acquired and did not close grasped at any strategy that would quickly reduce costs and lower length of stay.  Management engineers eagerly responded and jumped at the chance to reorganize operations, reduce FTEs and lower operating costs.  They had read about New England Medical Center's success at lowering length of stay with a case management program, and with a little sprinkling of fairy dust, they recommended integrating the social work and utilization review departments to create case management departments responsible for discharge planning and utilization review.

There were two dominent variations of the functional case management  model:  In version one, a case manager was assigned to a patient population  (typically a geographic unit) and did it all....UR and DCP including all the logistics associated with arranging the discharge plan.  In version two, social workers became the chief discharge planner and logistic officers while nurses became the chart auditors reviewing medical documentation for utilization review criteria, the presence of core measures, and potential quality breaches, among other "you're in the chart anyway" tasks. And because case management has a broad view of hospital operations with insights on the clinical and financial side of the business, these departments were often asked to 'help out' other operational areas or take on new tasks to fill the gaps in other areas of the hospital.

Not only did these 2nd generation models forgo the original hospital case management intent, they positioned the case manager in an untenable role:  They were policing the charts to make sure medical documentation supported hospital level of care, confronting the physician to discharge the patient when there was no documented evidence that the patient required hospital care,  getting agreement among the patients' consulting physicians for a discharge plan, implementing that plan through hours on the phone or the fax machine, and regurgitating medical record information to a payer representative whose primary goal was to enter as much clinical information into their data warehouse to defend the severity of their member's medical condition while seeking excuses not to pay for the care being provided.  

Whew!  The results of this model were inevitable:  Hospital case manager job vacancies soared and potential candidates within the facility swore they wouldn't do the job for any amount of money!  Length of stay crept higher, just in time discharge planning prevailed and failed to adequately prepare the patient for return home resulting in readmission increases, no one was monitoring resource utilization and costs per case jumped significantly, and denials escalated requiring rework, fixing, rebilling, and causing revenue delays.

It wasn't until the IOM report in 1999, To Err Is Human, that hospital executives and case management department leaders started to see the value in achieving outcomes rather than completing tasks and third generation outcome models started to appear in hospitals. Today, hospitals have teams of utilization review experts proficient in their work to ensure that the hospital's policies and practices governing a patient's eligibility for hospital level of care are compliant with state, federal and contractual obligations. They have care managers working with selected patient populations to ensure that the progression of care is safe and efficient and that resource utilization is appropriate to the patient's immediate needs.  They have centralized post acute resource centers staffed with savvy coordinators to turn the discharge plan developed by the patient's clinical team into reality in a timely manner, and they have leaders who understand that once a succcessful hospital care management program is achieving bottom line outcomes for every stakeholder, they must start thinking about patient-centered care management across the continuum and begin planning for 4th generation models.

That elite hospital mentioned earlier is currently running at a 1.8% operating margin.  If the case management program continues doing the same thing they've been doing all these years and expect a different result in a rapidly changing marketplace, that slight edge will surely disappear.