Reducing Readmissions and Healthcare Costs: The Green House Solution

By / Posted on July 18th, 2014

In a recent issue of McKnight’s, I saw this headline – “Reducing readmissions should be No. 1 priority for reducing healthcare costs, quality experts say.”    That was a key conclusion of a recent online poll from 300 members of the American Society for Quality (ASQ) , which describes itself as the “largest network of quality resources and experts in the world” and includes prominent long-term care quality consultants.

It doesn’t take a quality expert to realize that reducing preventable readmissions is a great way to reduce healthcare costs.  By definition, “preventable” means wasted money.  In addition to saving money, reducing readmissions improves the quality of life for Elders, by minimizing the stress and disruption hospital admission causes.

Another article in McKnights from a couple of months ago suggests that pressure ulcer stats are the most reliable indicator of the likely readmission rate from a particular nursing home.  Based on an analysis of data from 4,000 hospitals, HSR: Health Services Research found that pressure ulcer prevalence in particular predicts whether a nursing home will readmit residents.

Can Green House homes help reduce readmissions?  The answer is a resounding “yes!”  In preliminary research (a complete study will be available later this year from the THRIVE research team), traditional nursing homes had readmission rates that were 7 points higher than Green House homes.  A related study found that the incidence of pressure ulcers in Green House homes was “significantly lower” than the incidence in traditional homes.

The bottom line?  The THRIVE research team concluded that the “overall difference in total Medicare and Medicaid costs per resident over 12 months (sum of hospitalization and daily care costs (RUG costs)) ranged from approximately $1,300 to $2,300 less for residents in Green House vs. traditional nursing homes” depending on RUG rates in the state.