Asthma Program Helps Patients, But May Hurt Hospitals

April 13, 2010— -- By taking steps outside the confines of their own facilities, more and more hospitals have been able to keep their asthmatic patients from showing up at their emergency rooms as often.

But ironically, programs aimed at improving asthmatic patient's quality of life may be hurting these hospitals' bottom line.

Children's Hospital in Boston is one of several in the nation that run home intervention programs for children with asthma. They help parents learn more about the condition, administer medications properly and clean homes of dust and other irritants that can trigger reactions in children with the condition.

"It's designed to address some of the problems the hospital was seeing in terms of certain kids with more severe asthma or other issues, repeatedly coming into the emergency room or being hospitalized," said Susan Sommer, a nurse at Children's who works in the program, called the Community Asthma Initiative.

"If we can reduce exposure to those triggers, kids are going to be healthier and may possibly need less medication because they're not being exposed to as many allergen," she said.

But while these programs improve quality of life for the children and lower the number of hospitalizations and visits to the ER, they also may create a revenue problem at the hospital, as they lose a source of admissions and typically are not paid for the interventions themselves.

"An empty hospital bed is a revenue loss, and asthma is Children's Hospital's leading source of admissions," wrote Dr. Atul Gawande of the program in the April 5 issue of The New Yorker. "Under the current system, this sensible program could threaten to bankrupt it. So far, neither the government nor the insurance companies have figured out a solution."

Dr. Shari Nethersole, a pediatrician at Children's and the medical director for community health said the program was started in late 2005 using philanthropic funds as well as a grant from the Centers for Disease Control and Prevention.

She predicts that the asthma program would not bankrupt Children's. At the same time, Nethersole said funding has proven to be a challenge. Just one small insurer in Boston pays for the home visits, and Medicaid, which accounts for the insurance of over 70 percent of the children, does not cover them at all.

"Our CDC grant runs out in another year and a half, two years," said Nethersole, explaining that it is unclear where funding will come from after that time.

An Unclear Financial Picture

While it may seem the hospital loses money by providing an extra service for its asthma patients, Nethersole said it isn't entirely clear that this will continue to be the case in the long run.

She noted that beds freed up by not having as many asthma patients could make it possible for the hospital to care for patients with more complicated problems.

"Whether the hospital actually loses or doesn't lose money is a very complicated analysis," said Dr. Charles Homer, a pediatrician and CEO of the National Initiative for Children's Healthcare Quality.

He explained that in cases like Children's Hospital in Boston or Children's Hospital of Philadelphia, which runs a similar asthma intervention program, "It's complicated because those are very high intensity places and they can often take care of children with more complicated needs and problems."

At the same time, Homer said, asthma disproportionately affects children in the most vulnerable populations. As a result, Medicaid and health care payers need to make sure that the preventive asthma care will be encouraged.

"What you'd want to do is create financial incentives that would at least not penalize people for doing the right thing," he said.

Lisa Mannix, the manager for state government relations at Children's, said that some of the problems stem from the asthma initiative involving places and people not typically considered part of health care.

"In the current, traditional health care system, those kinds of workers are not providers that have been able to bill or get any payment for their service," she said.

"I think there's generally interest," she said of conversations with Medicaid providers about payment for the program. But, "months have gone by and it just hasn't come to fruition."

These types of programs have gotten some attention. America's Health Insurance Plans has given grants in the past to promising interventions for treating asthma.

Mannix and Homer agree that some form of bundling -- where payments are based on the patient rather than hospital visits -- will likely be necessary to overcome the problems programs like the Community Asthma Initiative ostensibly face.

"It's a lot more expensive than what it would be to provide care up front," said Mannix. "At the end of the day, it is Medicaid or other insurers who reap the benefit of not having to pay for these urgent care visits."

The View From New York

Desire La Tempa, who runs the program at Woodhull Medical Center in Brooklyn, N.Y., said her program has seen similar results to those at Children's in Boston.

She said that after interventions at home, patients had a 52 percent reduction in ER visits and a 78 percent reduction in hospitalizations for asthma.

But one issue she has not seen as much is with Medicaid. Payments are done by state, and in New York, she said, Medicare will cover a home visit to help a patient with asthma. While La Tempa said she does not know the exact reason for the difference in policy in Massachusetts, she noted that New York's extremely high asthma rate may have something to do with it.

"If you check the amount of money these patients cost to Medicaid, it's really high," she said. "That really costs Medicaid much more than providing a patient with these resources."

But she said that hospitals may benefit from these programs in more ways than just helping patients.

For one thing, La Tempa said, patients who go to the ER may return if they do not get an intervention. And in those cases its not clear Medicaid will pay extra for the same problem.

But hospitals that provide the home visit service may see benefits the way other businesses do, she said.

While interventions have reduced ER visits and hospitalizations, La Tempa said one type of hospital visit was growing: planned visits to the clinic to help with asthma management, which doubled between 2008 and 2009.

When patients are able to control their condition with the hospital's help, she said, they will spread the word. And in areas with plenty of asthma, more patients may want that same level of care.

"They're going to bring their family and their friends as well," said La Tempa.