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Tag: hospital profit

Hospital Discharges for Peak Profit?

February 23, 2015

Most of us take for granted that we and the ones we love would only be discharged from a hospital when we are actually medically ready to be discharged.  A recent report by the Wall Street Journal suggests that at least part of the equation for some hospitals is maximizing profitability.

Long-term acute care facilities operate based on significant Medicare payments, and those payments are tied to the duration of patients’ hospitalizations.  The Wall Street Journal article highlights that Medicare payments “max out” after a certain length of stay, after which profitability on the stay declines.  Kindred Healthcare Inc. owns several such hospitals and is one of the companies whose patient discharges seem to cluster around the point of maximum profitability.

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The article does not mention analysis of statistics related to any of Virginia’s long-term acute care facilities (Centra Specialty Hospital, Hampton Roads Specialty Hospital, Hospital for Extended Recovery, and Lake Taylor Transitional Care).  It does, however, quote past hospital executives who witnessed firsthand the compensation incentives associated with discharging patients at the time of most profitability for the companies, although they deny they would ever do anything to put a patient at risk.  But perhaps it goes without saying that measures that increase profit can also carry risk.