February 03, 2014

Why Patient Satisfaction is an Uphill Climb

Picture this. Today is the day. It’s early and the sun is just coming up as you and your spouse wind your way off of the highway towards the hospital. You’re in the passenger seat watching the street lights wiz by and contemplating the upcoming surgery. The car… Read More

Picture this.

Today is the day. It’s early and the sun is just coming up as you and your spouse wind your way off of the highway towards the hospital. You’re in the passenger seat watching the street lights wiz by and contemplating the upcoming surgery. The car pulls into the hospital parking lot and your spouse hands the valet parking attendant your keys and you both head inside past the Starbucks coffee stand, to check in.

What about that story sounds strange?

When it comes to health care it’s no surprise that patients always have and always will demand the best. Historically being the best hospital “the best” simply meant having the best nurses, doctors, and surgeons. Now though in the United States, being the best hospital and offering the best health care can mean a lot more than that.

New definitions

Going back 20 years would you ever have expected to find valet parking, five star restaurants, a Starbucks, online ED reservations or all four inside a hospital? Certainly not. But in 2014 the odds are, depending on where you are in the country, that you’ll find at least one of these luxuries.

Even more basic amenities that were previously uncommon in hospitals, like private rooms and “quiet kits” with ear plugs and lavender lotion to help patients relax, are becoming the norm in some facilities. All of this to make sure that patients are satisfied with their hospital stay. But why?

HCAHPS and Medicare reimbursement

Part of the answer to why these huge patient satisfaction efforts are being undertaken is the decision by CMS under the Affordable Care Act (ACA) to tie Medicare reimbursements to HCAHPS survey scores.

HCAHPS is short for Hospital Consumer Assessment of Healthcare Providers and Systems and pronounced “H-Caps”. It is a national, standardized, publically reported survey of the hospital experience from the perspective of patients. Previously CMS mandated that hospitals simply administer the survey to their patients with no stakes attached to the score. Now that is changing.

Under new rules that took effect in fiscal year 2013 hospitals must annually submit at least 100 survey results to CMS. From the submitted results, CMS issues the hospital a grade. If the hospital performs poorly CMS is permitted to reduce their reimbursement rate by up to one percent. By fiscal year 2017 that percentage increases to two percent.

The trouble for hospitals

For certain hospitals, especially larger ones, a reduction in Medicare reimbursements because of survey results might not be the same death knell as it would be for a smaller hospital. But for those smaller hospitals, especially in areas with a large amount of Medicare recipients, that percentage reduction can be the difference between staying solvent, or shutting down.

The bigger problem though is that CMS is essentially sanctioning the wildest of patient satisfaction demands and this concept of the “hospital-hotel industrial complex”. That in order to get good survey scores and keep reimbursements, hospitals need to be more like hotels and offer more amenities.

You could also make the case about how accurate HCAHPS survey scores actually are.

The argument boils down to this: CMS is reducing their overall reimbursement amounts and the health insurance industry as a whole is following suit. Especially with the major provisions of the Affordable Care Act now in place. Reimbursement rates from private insurers for health insurance exchange plans have cratered. Some are even reimbursing below the Medicaid rate.

This means that on the one hand CMS is pressuring doctors and hospitals under threat of reimbursements to cater more and more to patient satisfaction. While at the same time reducing the amount of money that hospitals will have to even meet basic health standards, let alone afford fancy amenities.

What’s the solution?

Still though, your average hospital patient is not aware of all this. They just want to get healthy again, and have the best care experience they can. Why should they think how much it costs the hospital each month for the Starbucks franchise in the lobby? The situation of reduced reimbursements is just not common knowledge among hospitals patients.

All these fancy amenities that hospitals invested in were designed as ways to attract patients and build their reputation as quality facility. They were all purchased with the assumption that reasonable reimbursement rates would remain a constant. Now though the landscape of American healthcare is changing and everyone is being forced to do more with less.

The fact is, the new situation of American health care for 2014 and beyond is that there’s not enough reimbursement money to meet all of a patient’s standards for satisfaction beyond the basic needs of their health. But that won’t stop them from demanding more and more from their hospital stay, and then driving down HCAHPS scores and thus reimbursement rates when those expectations for five star restaurants, valet parking, and Starbucks aren’t met.