March 18, 2010

Providing specialized, high-quality care to Illinois’ sickest patients could not only improve their health outcomes but reduce Medicaid spending by almost $10 million annually, under legislation sponsored by State Sen. Christine Radogno (R-Lemont).

“Considering the benefits to the patients’ outcome and the projected cost-savings, establishing a program that would transfer patients who need really intense, extended care to a facility dedicated to caring for their specialized needs, is a no-brainer,” said Radogno.

Senate Bill 3743 creates the Long Term Acute Care Hospital Quality Improvement Transfer Program. The program would create access to beds in long term acute care hospitals (LTACH) which specialize in treating patients needing ventilators, wound care and medically complex conditions.

Additional access would be created by paying a supplemental rate to qualifying LTACHs. Facilities classified as LTACHs must meet strict requirements and agree to provide quality measurement data. Short term acute care hospitals would be allowed to transfer patients to LTACHs, and LTACHs would be provided with an increased rate, but that rate would actually be cheaper than paying outlier payments to short term acute care hospitals.

Radogno said that the Illinois Department of Healthcare and Family Services has estimated a conservative savings of $10 million, but noted that savings could be more if hospital re-admissions are reduced. Savings would occur because patients would likely be healthier at discharge.

“Under the provisions of Senate Bill 3743, we are requiring a detailed evaluation of the program’s cost saving. If the program is not saving money, then the Department of Healthcare and Family Services (HFS) can adjust the LTACH’s rate to guarantee cost neutrality,” Radogno explained. “HFS can also reduce the rate at LTACH’s if quality measures aren’t met—increasing incentive for these hospitals to offer superior care.”

Senate Bill 3743 was approved by the Illinois Senate, and now moves to the Illinois House for approval.