MSRA and it's Finacial Impact On Healthcare

Dec 29, 2015
By Anthony Sannazzaro
Hospitals today are increasingly being challenged by rising patient infection rates, especially from
“superbugs” such as methicillin-resistant Staphylococcus aureus (MRSA). And the challenges are only
going to increase as new Medicare rules go into effect in 2017 that will include MRSA in all
reimbursement calculations – potentially costing hospitals hundreds of millions of dollars in lost Medicare
reimbursements.
This ill-fated financial scenario is currently battled primarily through surface disinfection, which is only
moderately effective since bacteria are constantly reintroduced through ventilation systems. The solution to
reigning in MRSA infection rates is air-cleaning technology that destroys harmful bacteria in the airstream.
By installing such systems now, the results for hospitals will be healthier patients and a better bottom line.
MRSA: A Costly and Potent Superbug
Facing skyrocketing healthcare costs, the Centers for Medicare and Medicaid Services (CMS) is targeting
one of the primary causes: hospital-acquired conditions (HACs). According to the CMS, a HAC is an
infection acquired in a hospital by a patient who was admitted for a reason other than that infection. HACs
make up a substantial portion of overall health care spending, and MRSA is one of the main culprits.
Considered a superbug, MRSA has developed a resistance to most antibiotics and is extremely potent. For
example, according to the Pew Charitable Trusts, every year in the U.S. MRSA is responsible for up to $4.2
billion in costs. But the worst cost of all is the human price paid since MRSA is responsible for
approximately 80,000 infections and 11,000 deaths annually in the U.S.
New MRSA Rules Could Cost Hospitals Super Sums
Currently, MRSA infection rates aren’t part of the reimbursement equation in Medicare’s Hospital Value-
Based Purchasing (VBP) scorecard, but that will change starting Jan. 1, 2017. At that point, MRSA will not
only be included in reimbursement calculations as dictated by the Hospital-Acquired Condition Reduction
Program, but the weighting of infections will increase as well from 65 percent in 2015 to 85 percent in
2017.
All hospitals nationwide will be impacted by the new MRSA rules, but it will be the worst-performing ones
that will be hardest hit financially. Hospitals already face a 1 percent reduction in payments if they are in
the bottom 25 percent with regard to HAC prevention – and that’s without MRSA incorporated. With
MRSA factored in, hospitals will be facing hundreds of millions of dollars in lost Medicare
reimbursements.
This is on top of what it costs to treat MRSA. According to the Centers for Disease Control and Prevention
(CDC), MRSA infections are among the highest of all antibiotic-resistant threats. What’s more, treatment
can last months and many times patients have to return after the initial discharge. For these reasons, MRSA
care in the U.S. can cost up to $60,000 per patient and up to $9.7 billion annually.
New York City Hospitals Facing Greatest Financial Impact
Hospitals across the U.S. will be affected by the updated MRSA calculations, but one of the areas facing
the greatest financial impact is New York City since the metro region is home to many of the worst
performers in the country. The city’s hospitals, especially those already struggling to contain MRSA, are
barely turning a profit, and these looming cuts that represent tens of millions of dollars could put many of
them in the red.
For example, looking at hospitals in the three largest U.S. cities, New York City, Los Angeles, and Chicago,
it’s clear that New York City will be hardest hit. Even with just the current reimbursement structure that
doesn’t include MRSA, for the fiscal year 2015, New York City is projected to lose over $26 million in
penalties compared to only $9 million for Los Angeles and $8 million for Chicago. Once MRSA is factored
in, these losses will skyrocket.
The Solution: Better Air Treatment
MRSA is difficult to remove from an indoor space. It’s also easily spread via respiratory droplets and
aerosol tracts and can live for up to 80 days. It commonly attaches to skin scales of various sizes, and as
these scales shed, the larger ones fall to the floor and the smaller ones can waft through the entire length of
a hospital ward. When MRSA does settle, the bacteria are generally found on dusty, hard-to-reach surfaces.
Because MRSA travels through the air so effortlessly, the traditional way to remove it is through air
filtration. However, conventional HVAC filters only capture large particles and miss the smaller – and
deadlier – ones, such as MRSA, other bacteria, viruses and volatile organic compounds (VOCs). Therefore,
a more effective option is Photocatalytic Oxidation (PCO), which destroys the smallest particles by
converting them into carbon dioxide and water.
PCO technology has many benefits. First and foremost, it removes 99.99 percent of the MRSA bacteria in a
single pass, as well as other submicron contaminants, including tuberculosis, anthrax, staph, E. coli,
endotoxins, mycotoxins, viruses, and other VOCs. Additionally, the oxidation process takes place within the
air cleaner so no reactions occur around indoor occupants. The efficient design uses no extra fan energy
and the cost-effective technology integrates seamlessly with existing air handling units (AHUs).
The Results: Fewer MRSA Infections and an Improved Bottom Line
The data show that hospitals across the country that utilize PCO technology have significantly fewer
MRSA infection rates. On average, hospitals using this technology score 27 points (out of 100) higher
compared to those in New York City without such systems. These high-performing hospitals stand to
increase their reimbursements with the impending change to the Medicare structure, thus improving their
bottom line.
In Sum
New MRSA rules beginning in 2017 are poised to cost hospitals – especially the worst performers –
hundreds of millions of dollars in lost Medicare reimbursements. However, this unfavorable financial
scenario can be avoided if hospitals act now and install the right air-treatment technology, such as a PCO
system, to eliminate MRSA. Not only will hospitals avoid massive financial losses, but the health of their patients will also be significantly enhanced.
Anthony Sannazzaroisco-founder of HIGHMARK, a pioneer in building efficiency.