UPMC St. Margaret opening 'observation unit'

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Beginning this week, patients arriving at UPMC St. Margaret Hospital near Aspinwall may find themselves directed to a newly designated "observation unit," where they will stay as physicians examine them, run tests and assess whether their chest pain or injured hip requires additional treatment.

But, make no mistake, even if patients in the 13-bed unit get X-rays, blood work or even stay overnight, that's no assurance they've actually been admitted to the hospital.

St. Margaret and several other local hospitals are addressing the growing number of patients whose stay Medicare considers an outpatient observation rather than a hospital admission -- and therefore reimburses the hospital perhaps one fourth what it would pay for an admission.

In a recent letter to primary care physicians, John Lagnese, a family care physician and St. Margaret's vice president of medical affairs, noted the average length of stay for observation patients is 1.6 days. "The goal is to try to keep the [average length of stay] to less than 24 hours," he wrote.

"This is a significant issue for the well-being of the hospital. It also should better meet the needs of our patients, most of whom would like to get out of the hospital as soon as possible."

Dr. Lagnese is not overstating the case.

In 2012, UPMC facilities saw a 21.7 percent increase in "observation" cases over 2011, while inpatient medical-surgical admissions were flat.

Regionally, the percentage of patients designated outpatient observations at Western Pennsylvania hospitals has consistently run above 20 percent.

The observation vs. admission designation can carry significant financial impact for patients, too, as many health insurance policies won't cover the cost of outpatient observations and the patient ends up paying the bill.

Medicare also will not cover follow-up nursing home care unless it follows a three-day hospital admission. If patients stay in the hospital for two or three days under "observation," they may be paying full fare if they need a skilled nursing care facility as they recuperate.

"The problem with observations now is that it's been changed or altered by the insurer, including the government, to keep patients there without granting admitted status because the reimbursement is much less," said Alan Yeasted, a primary care physician at St. Clair Hospital in Mt. Lebanon and governor of the American College of Physicians for Western Pennsylvania.

St. Clair has had a designated observation unit since 2010, he noted.

"The only thing [the St. Margaret staff] are trying to do is make it more efficient. If they need a scan done, that can be done on a priority level. That's very difficult to do when patients are scattered throughout the hospital," he said.

Both Dr. Yeasted and family medicine physician Larry John, who chairs the primary care coalition for the Allegheny County Medical Society, say designated observation units will not affect patient care. What is likely to happen will be a conversation between the patient and the hospital staff about the financial, as well as medical, risks associated with their care.

Said Dr. John: "The hospital has said, 'We want to do the best job we can for these patients and set up a situation where everyone is aware of the patient's status.' "

To get more observation cases treated and released within 24 hours, Dr. Lagnese at St. Margaret has asked primary care physicians to "make every effort to see these patients as early as possible in the morning for initial evaluation and discharge."

"It may seem clinically backward since these patients are usually not as sick as others, however, early rounding is imperative if we are going to make this work."

The hope, he said, "is that with the focused support and streamlined care of this project, our patients will receive better, more efficient care which will benefit the patients, physicians, and hospital."

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Steve Twedt: stwedt@post-gazette.com or 412-263-1963.


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