Easy as 1-2-3 (4): Education halved this facility’s readmissions

Sequence mailings cultivate self-management

When a team at Columbia San Jose (CA) Medical Center (CSJMC) studied the cost-effectiveness of a structured education program for patients with congestive heart failure (CHF), results confirmed and even bettered their expectations: The hospital saw an 8:1 return on its investment. The intervention cut readmission rates by nearly half, resulting in substantial cost savings for the hospital as well as payers.

One hundred nine patients participated in CSJMC’s study. Of 54 control patients, 27 had at least one readmission and 43 readmission events — readmission rate, 50%. Of 55 intervention patients, 15 were readmitted and they had 21 readmission events — readmission rate, 27%.

The 51% reduction in readmissions translates to 103 avoided hospitalizations as shown below:

The impact of those avoided readmissions on demand and treatment costs is significant.

The average cost of a CHF readmission at the medical center is $6,000. Medicare reimbursement is $4,120, so the reimbursed treatment cost shortfall per episode is $1,880. "You’re losing money on CHF patients right off the bat," notes Monica Miyaji, RN, quality improvement coordinator at CSJMC. "And some readmissions are not reimbursed at all. It depends on the reviewer, but Medicare typically won’t pay for a readmission within 30 days."

When the study team multiplied that figure by 103, they realized that the avoided readmissions saved nearly $194,000. After deducting the amount spent on the education intervention, the hospital saved nearly $173,000. (See table showing hospital savings, above.)

A small price to pay: $50 per patient

Getting CHF patients to change their lifestyle in terms of nutrition, weight monitoring, and medication compliance is the sticky side of CHF management. "Early on," says Miyaji, "it became clear that those issues were very important and warranted a pilot study." The study team set out to see if by mailing education pieces, patient compliance with self-care instructions could be increased and readmission rates reduced.

For purposes and duration of this study, no case managers worked with the patients. "Our intention," says Miyaji, "was to test the bare minimum effort — sending four packets of information to the patient’s home with no further action — and it’s upon that minimum that our outcomes were based. With the state of health care today, we didn’t want to impact the bedside and make more work for the nursing staff. Of course the efforts of case managers and home health workers make outcomes even better than what we reported."

Competitive factor

A peripheral benefit of the cost-saving effort: No matter where a hospital is located or what system it’s affiliated with, if a payer has a choice as to where it sends patients, it will choose an institution that has worked to bring down costs and readmissions. "To stay competitive, you want to keep your institution attractive to the payer," says Miyaji.

CSJMC hired an administrator to assemble and mail four sets of packages to patients. (See story describing the contents of the sequential mailing, p. 107.) The project cost $50 per patient for postage, educational brochures, the folder, the video, fact sheets, and 15 minutes of administrative time. "Spending $50 per patient on an education intervention is nothing compared to the cost of one readmission," Miyaji notes.

If a company puts together, processes, and mails the items for the hospital, the cost is approximately quadrupled and feasible only in the case of very large facilities. "The postage and materials are not the big costs. It’s the setup cost, and once that’s paid, the cost-effectiveness increases," says Seth Serxner, PhD, director of research at Krames Communications, a publisher of consumer-oriented wellness and safety materials in San Bruno, CA. "You break even at about 1,000 pieces. Having the company fulfill your educational packages works cost-effectively for large health plans."

Until recently, CHF was the most expensive health problem in the United States, accounting for a million hospitalizations annually and almost $11 billion. Miyaji, who currently heads the CHF initiative for 350 Columbia hospitals nationwide says, "In 1996, Columbia spent $330 million on CHF admissions and readmissions. If we decreased that figure by 30% — a doable goal — we’d save $94 million."