New regulations stemming from the Affordable Care Act and the associated push toward determining the appropriate level-of-care for patients have changed the way in which hospitals utilize resources to make this determination. Managing this process involves getting the determination of level of care early in the decision making process and performing frequent evaluations to determine if that level of care has changed. 

The determinations of patients via portals of entry other than the Emergency Department are mostly predetermined prior to hospitalization. Therefore, it seems that the biggest bang for the buck from the hospital’s point of view is making the correct level of care determination of emergency patients requiring hospitalization.

Different hospitals vary on how this process is accomplished. Some hospitals place a care manager in the geographic area of the ED, while others have a care manager review information from an alternate location. Some perform this real-time as soon as the patient has been determined to require hospitalization while others provide the service retrospectively, sometimes only Monday through Friday and then only during certain business hours. Then there are institutions which use a third-party vendor to assist in determination of level of care.

Regardless of the process, making the correct determination the first time is essential. Regulatory compliance does not allow changes in a patient’s level of care once they are no longer hospitalized and certain changes require a complex series of tasks to maintain compliance.

Patients who were deemed to be in Observation Care during the initial level-of-care decision-making process may end up being upgraded to an acute inpatient due to the patient’s condition worsening or other factors. This is many times done in conjunction with contacting commercial insurers to obtain an authorization or agreement that the patient’s condition now warrants inpatient level of care. The patient is often completely unaware of the change, though it can have a number of consequences related to payment responsibilities or eligibility surrounding alternate care resources when the patient is discharged.

Furthermore, if this decision is later reviewed by a care manager or some other reviewer and the patient has Medicare as a primary payor, then a compliance component termed “code-44” is introduced and a series of tasks must be completed while the patient remains hospitalized involving another physician, documentation and informing the patient of this change in status. When reviewers determine the hospital made a mistake with regard to level of care determination, it can have significant financial implications.

Capacity management hinges on rigorous processes that get certain patient types to the right place the first time. The consequences of not doing this results in poor management of hospital beds, more crowding, and lowered patient satisfaction, and financial penalties for the hospital.