The Effects of Global Budgeting on Emergency Department Admission Rates in Maryland

Galarraga, Jessica E.; Black, Bernard S.; Pimentel, Laura; Venkat, Arvind; Sverha, John P.; Frohna, William J.; Lemkin, Daniel L.; Pines, Jesse M.

doi:10.1016/j.annemergmed.2019.06.009

Cited by 10 publications

(14 citation statements)

References 19 publications

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“…One relevant example is global budgets which are used in Maryland hospitals, which have reduced their susceptibility to the large volume shifts observed during the COVID-19 pandemic. 7 In conclusion, the COVID-19 pandemic has had a dramatic impact on the economics of EDs and the livelihood and job prospects for emergency physicians and APPs. After a period of expenses exceeding clinical payments, medium and large EDs have been able to recover financially through lower ED staffing with fewer clinical hours for both physicians and APPs.…”

Section: Discussionmentioning

confidence: 99%

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How the COVID-19 pandemic has adversely affected the economics of U.S. emergency care

Pines

Zocchi

Black

et al. 2020

Preprint

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ObjectiveWe describe how the coronavirus (COVID-19) pandemic impacted emergency department (ED) economics, acuity, and staffing.MethodsWe conducted an observational study of visits during January to September 2020 compared to 2019 in 136 EDs staffed by a national emergency medicine group. We created ratios of three-week moving averages for 2020 visits, acuity, costs divided by 2019 moving averages, by age and ED size. We tabulated reductions in clinician hours and FTEs compared to early 2020 staffing.Results2020-2019 ED visit ratios declined in March nadiring mid-April for both adults (to 0.60) and children (to 0.30) and rose thereafter but remained below 2019 levels through September 2020. The ratio of adult RVUs/visit rose to 1.1 for adults and 1.2 for children in the early pandemic, falling to 1.04 and 1.1 through September. The ratio of direct salary expenses in freestanding (FSED) and small EDs declined less dramatically than in medium and large EDs. Clinical revenues in medium and large EDs declined more sharply and recovered slowly but plateaued well below 2019 levels. By September 2020, expenses were still higher than revenues for small EDs, similar for FSEDs, and somewhat higher for medium and large EDs. During the pandemic, physician hours fell 15% and APP hours 27% during COVID-19 translating to 174 lost physician and 193 lost APP FTEs.ConclusionThe COVID-19 pandemic reduced ED visits and increased acuity in the first 7 months of the pandemic, leading to a contraction of the ED workforce, and threatening ED economics, more so in small and FSEDs.

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Section: Discussionmentioning

confidence: 99%

“…One relevant example is global budgets which are used in Maryland hospitals, which have reduced their susceptibility to the large volume shifts observed during the COVID-19 pandemic. 7…”

Section: Discussionmentioning

confidence: 99%

How the COVID-19 pandemic has adversely affected the economics of U.S. emergency care

Pines

Zocchi

Black

et al. 2020

Preprint

Self Cite

View full text Add to dashboard Cite

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“…One example is the global budgets used in Maryland hospitals, which reduced hospitals' susceptibility to the large volume shifts in the COVID-19 pandemic. 25,26 A capitation-based model for ED clinician services could be worth exploring, with payment based on the population expected to be served. This could be either a full model for ED clinician revenue or a "floor" on revenue to cushion against financial shocks.…”

Section: Discussionmentioning

confidence: 99%

The Effect of the COVID-19 Pandemic on the Economics of United States Emergency Care

Pines

Zocchi

Black

et al. 2021

Annals of Emergency Medicine

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Study objective: We describe how the coronavirus disease 2019 (COVID-19) pandemic affected the economics of emergency department care (ED). Methods:We conducted an observational study of 136 EDs from January 2019 to September 2020, using 2020-to-2019 3-week moving ratios for ED visits, complexity, revenue, and staffing expenses. We tabulated 2020-to-2019 staffing ratios and calculated hour and full-time-equivalent changes.Results: Following the COVID-19 pandemic's onset, geriatric (age !65), adult (age 18 to 64), and pediatric (age <18) ED visits declined by 43%, 40%, and 73%, respectively, compared to 2019 visits and rose thereafter but remained below 2019 levels through September. Relative value units per visit rose by 8%, 9%, and 18%, respectively, compared to 2019, while ED admission rates rose by 32%. Both fell subsequently but remained above 2019 levels through September. Revenues dropped sharply early in the pandemic and rose gradually but remained below 2019 levels. In medium and large EDs, staffing and expenses were lowered with a lag, largely compensating for lower revenue at these sites, and barely at freestanding EDs. Staffing and expense reductions could not match revenue losses in smaller EDs. During the pandemic, emergency physician and advanced practice provider clinical hours and compensation fell 15% and 27%, respectively, corresponding to 174 lost physician and 193 lost advanced practice provider full-time-equivalent positions. Conclusion:The COVID-19 pandemic adversely impacted the economics of ED care, with large drops in overall and, in particular, low-acuity ED visits, necessitating reductions in clinical hours. Staffing cutbacks could not match reduced revenue at small EDs with minimum emergency physician coverage requirements. [

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“…11 Another recent study indicated that the global budget led to modest declines in ED utilization the year after implementation in Maryland. 12 Increased ED boarding in Maryland since 2014 coincides with the payment structure change and places the state on a divergent trajectory from other states, where boarding has been stable or decreasing over the same period.…”

Section: Hospital Cost Savings May Unintentionally Contribute To Emergency Department Boarding and Ambulance Diversionmentioning

confidence: 99%

Balancing Efficiency and Access: Discouraging Emergency Department Boarding in a Global Budget System

Stryckman

Kuhn

Gingold

et al. 2021

WestJEM

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Reducing cost without sacrificing quality of patient care is an important yet challenging goal for healthcare professionals and policymakers alike. This challenge is at the forefront in the United States, where per capita healthcare costs are much higher than in similar countries around the world. The state of Maryland is unique in the hospital financing landscape due to its “capitation” payment system (also known as “global budget”), in which revenue for hospital-based services is set at the beginning of the year. Although Maryland’s system has yielded many benefits, including reduced Medicare spending, it also has had unintentional adverse consequences. These consequences, such as increased emergency department boarding and ambulance diversion, constrain Maryland hospitals’ ability to fulfill their role as emergency care providers and act as a safety net for vulnerable patient populations. In this article, we suggest policy remedies to mitigate the unintended consequences of Maryland’s model that should also prove instructive for a variety of emerging alternative payment mechanisms.

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The Effects of Global Budgeting on Emergency Department Admission Rates in Maryland

Cited by 10 publications

References 19 publications

How the COVID-19 pandemic has adversely affected the economics of U.S. emergency care

How the COVID-19 pandemic has adversely affected the economics of U.S. emergency care

The Effect of the COVID-19 Pandemic on the Economics of United States Emergency Care

Balancing Efficiency and Access: Discouraging Emergency Department Boarding in a Global Budget System

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