Emergency rooms can earn hospitals revenue: study

By Kim Dixon

CHICAGO (Reuters) – U.S. hospital emergency rooms,
frequently beset by too many patients and too few beds, can
take in more money if they stop diverting arriving ambulances
to other hospitals, a study on Wednesday said.

By putting in more beds and avoiding so-called ambulance
diversion, a hospital could boost emergency-room revenues by 10
percent, according to the study of a 400-bed Oregon teaching
hospital published in the Annals of Emergency Medicine.

“It’s important that hospitals understand that decreasing
ambulance diversion can translate into higher revenues,” said
John McConnell, who led the two-year study of his hospital’s
emergency room at Oregon Health and Sciences University.

Most emergency rooms are understaffed and overwhelmed with
patients and unprepared to cope with a crisis such as a natural
disaster or terrorist attack, the nonprofit Institute of
Medicine said in a recent report. It also said diverting
ambulances inevitably leads to unnecessary deaths.

But hospitals have been hesitant to add capacity because
many emergency-room patients are among the ranks of the 46
million people who lack health insurance and may be unable to
pay.

The new study is one of the first attempts to show the
potential financial benefits to hospitals if they change
course, the authors said.

U.S. hospital emergency room visits have risen steadily,
jumping 26 percent between 1993 and 2003 to 114 million visits,
according to the Institute of Medicine, which advises the
government on health matters.

The Oregon study also found patients entering an emergency
room by ambulance are less likely to be uninsured and more
likely to be admitted to the hospital, than patients who walk
in.

“That was a surprise to us,” McConnell said. “The patients
where a hospital makes a lot of money is the heart-attack
(patient) who is then admitted,” he said.

The Oregon hospital treats about 43,000 emergency-room
patients each year, and midway through the studied increased
bed capacity.

When beds were added and ambulance diversion dropped, the
hospital gained about $175,000 in extra revenue per month.

A major limitation is the study didn’t quantify the revenue
lost from inpatient beds being used for emergency patients,
Robert Williams of the University of Michigan School of Public
Health said in an editorial in the journal.

“In simple economic terms, one patient is a sure thing and
the other, a roll of the dice,” Williams said.