Is Your Hospital Losing Money Over the Weekend?

The Impact of Weekend Utilization Review on Reimbursement

A White Paper from AppriseMD

It’s common to find hospital utilization management teams and physician advisory staffing lower during weekends.

Lower staff levels can lead to delays in patient determinations that ensure treatment is at the appropriate level of care (LOC). Staffing issues can also stall discharges, keeping patients in the hospital even though they are ready to leave. Both scenarios can negatively impact quality of care, the patient experience, and hospital resources. Prolonged hospital stays have been linked to an increased risk of hospital-acquired infections and other complications, while poor triage and discharge processes impact patient satisfaction scores (HCAHPS). All of these have financial ramifications that should be mitigated.

THE WEEKEND EFFECT
Researchers have shown a phenomenon known as the “Weekend Effect” can impact health outcomes. Evidence shows “lower levels of hospital staffing or staffing by relatively less experienced staff on weekends may result in inadequate assessments of patients or monitoring for complications.” ¹ This translates into extra hospital days that might have been avoided not only by timely evaluation of medical conditions but
also by triage into the proper LOC. The economic impact of misaligned LOC equates to reduced reimbursement alongside a higher probability of denials. To ensure that reimbursement is optimized, hospitals should reevaluate their weekend utilization review needs.

29% OF HOSPITAL DAYS OCCUR ON WEEKENDS
Weekends account for approximately 105 days of every year. Missing adequate weekend assessments exposes up to 29% of hospital days to potential payment issues. This effect is compounded on long holiday weekends, further increasing the weekend effect to a higher percentage and thus exposing a hospital to additional payment issues. Underpayments, for example, can occur when patients who qualify for inpatient status are kept in observation. On the other end of the spectrum, a higher rate of denial may result from patients kept as inpatient who should be in observation or are ready for discharge. For patients who are ready for discharge to another facility, intake is often closed on weekends, which further impacts this phenomenon. Delays in care, especially over weekend time periods, are heavily scrutinized by payers and often denied inpatient LOC status. Ensuring appropriate LOC placement on weekends is essential for revenue optimization.

THE WAITING GAME
Knowing why there is a delay in care is key to optimizing revenue, which is why hospitals should be tracking avoidable days 365 days a year. These hold ups occur most often over the weekend time period, especially during long holiday weekends, so tracking these avoidable days is the first step. For example, knowing how often a hospital has patients waiting on placement due to intake being closed over the weekend time periods can potentially lead to the hospital working with subacute facilities to incorporate weekend intake. There is also a subset of patients who may be waiting on diagnostic testing which may not be available on the weekends, providing another barrier to care and revenue optimization. Whatever the case may be, it is clear that hospitals should be providing physician advisor gap coverage services on weekends and holidays to ensure that patients are placed in the most appropriate LOC.
ADDRESSING THE WEEKEND GAP TO IMPACT REVENUE
To further illustrate this point, AppriseMD, an Illinois-based company focused on providing denial management and physician advisor services to hospitals and health systems, evaluated its client utilization review trends to uncover the impact of weekend reviews. For all AppriseMD hospital clients using services on a full-time basis (weekdays and weekends, including holidays) in Q2 of 2023, overall weekend utilization remained at 20%. Not surprisingly, Mondays were the busiest day for overall utilization of services. This is driven in part by the overall reduced weekend staffing at some client hospitals, which resulted in fewer than expected cases sent for second level review over the weekend.

OPTIMIZING REIMBURSEMENT TO ENHANCE REVENUE CYCLE
Physicians consider many factors during the complex clinical judgement used in determining a hospital admission. Appropriate LOC status is not always clear-cut, and a patient’s condition can change over time, making LOC determination a time-sensitive and a revenue-sensitive decision. To illustrate how much revenue can be lost, consider the Healthcare Financial Management Association’s estimates for “a standard inpatient case that may be reimbursed at about $6,500, based on CMS regulations, compared with $2,000 for a standard observation discharge.”² Considering the difference in these rates, HFMA notes “there is a $4,500 variance for a case that might have received the exact same care but was discharged with an inappropriate status.”² Such a significant variance reinforces the importance of ensuring appropriate LOC status every day, as misaligned care statuses will always equal reduced revenue. In addition, when a case is placed in an observation status because it does not meet inpatient criteria, a potential denial is avoided. This potentially generates $2,000 in revenue per observation case.

THE FINANCIAL IMPACT OF APPROPRIATE MEDICAL NECESSITY
Medical necessity determinations indirectly impact many areas within hospitals, including patient satisfaction, length of stay (LOS), readmissions, and staffing expenses. These in turn directly impact a hospital’s revenue, which is why the most appropriate LOC is necessary for enhancing the revenue cycle. The points below delve into how a hospital’s revenue is impacted by misaligned care level assessments on the front end.

1. Patient Satisfaction
The Centers for Medicare and Medicaid Services (CMS) uses the Hospital Consumer Assessment of Healthcare Providers & Systems (HCAHPS) to rate patient satisfaction. Patient opinions about their care can and will affect reimbursement. “Since 2012, HCAHPS scores have played a role in hospital payment through the Hospital Value-Based Purchasing program.”³ Equally, as “inflation continues to burden hospitals as margins remain near zero,”⁴ hospitals cannot afford to have the “Weekend Effect” lower their HCAHPS score due to delayed discharges or inappropriate observations stays. Higher copays⁴ are also generally associated with observation stay, which represents another factor that can negatively impact patient satisfaction.

2. Average LOS
A hospital’s average LOS, which is used to indicate efficiency in a hospital and/or patient case complexity, is directly impacted when patients are not classified in the appropriate LOC. Short stay patients who are inappropriately triaged to observation LOC when they should be inpatient LOC are not able to offset the lengthy LOS for other inpatients. Equally, patients inappropriately triaged to inpatient will likely result in a denial, which not only drives up the denial rate, but also requires additional resources. Finally, patients who are appropriately triaged to observation LOC but fail to progress may require a second level review by a physician advisor to assess if the patient can be converted to a higher LOC based on the failure to progress.

3. Readmissions
Medicare reduces payment if a hospital’s readmission rates for certain conditions are too high. Hospitals are, therefore, concerned about readmissions from patients within 30 days of an inpatient stay. This could be another factor driving observation LOC utilization. While this might decrease the number of cases under scrutiny for readmission, it reduces hospital reimbursement and usually results in higher patient out-of-pocket costs. As discussed above, higher co-pays drive down patient satisfaction, which also reduces Medicare funding.

4. Staffing Expenses
Assessing the most appropriate LOC includes medical necessity determinations for when care ends. AppriseMD physician advisors often recommend the patient be discharged to a care setting outside of the hospital. “Delays in patient discharges create bottlenecks in the health care system, adding to the already overwhelming challenges facing our hospitals and caregivers.”⁵ Equally, while hospitals do not get reimbursed for the extra days a patient stays at the hospital, they still must staff for patients who remain in their care.

ADMISSION STATUS: TIME SENSITIVE AND FOCUSED ATTENTION
To help determine the value of how timely, high-quality physician advisory services can yield positive financial results during the weekend, we looked at three hospitals with the highest second level utilization review requests sent over the weekend (taken from the subset referenced on page 3). Below is a chart that displays this group, followed by a more in-depth analysis of the LOC recommendations made only during the weekends in the same period. These changes in the LOC are particularly important, as identifying the appropriate LOC from the start is integral to positively impacting a hospital’s revenue.

TRANSLATING PATIENT EXPERIENCES INTO REVENUE
“Hospitals and health systems are dedicated to providing patients with the right care, in the right place, at the right time,” said AHA President and CEO Rick Pollack.⁵ Assigning the appropriate care level status upfront directly impacts the revenue cycle, thus every hospital should have back-up physician advisor coverage available, including on weekends and holidays. Examining this experience-cost relationship further, AppriseMD explored the financial impact its services had on three different clients during the weekends in Q2 of 2023.

Hospital A with approximately 15,000 annual discharges
This first example shows a hospital that sent 24% of its second level reviews during the weekends in Q2, with Saturdays and Sundays each representing 12% of weekend utilization. During this same period, AppriseMD suggested a total of 112 LOC recommendations, resulting in $495,000 in potential revenue² based on LOC changes alone. The hospital realized added value in the 24 instances where AppriseMD physician advisors recommended patients be discharged from the hospital, which freed up staffing and hospital beds. Equally, denials were avoided during this period, which impacts operating costs associated with the additional work that comes with managing denials.

Hospital B with approximately 1,000 annual discharges
This example shows a hospital on par with a critical access hospital that sent 27% of its second level reviews during the weekends. This is almost in line with what a hospital should be sending based on 29% of hospital days occurring on the weekends. During the Q2 weekends, while AppriseMD only recommended a total of nine LOC changes, this yielded more than $34,000 in potential revenue. The hospital realized added value with a reduction in denials and expenses, compounded with downstream positive financials because of increased patient satisfaction and appropriate LOS management.

Hospital C with approximately 12,500 annual discharges
Like Hospital A, this hospital saw 24% of its second level review requests occurring during the weekends. During the weekends in Q2, AppriseMD made a total of 135 LOC recommendations, 78% of which were to higher levels of care. Potential reimbursement for overall LOC recommendations equated to more than $700,000 for just one quarter when utilizing the conservative estimates cited by HFMA². The 30 LOC changes to observation or transfer/discharge equate to denials potentially avoided. This also adds to efficient use of hospital resources since hospitals do not get reimbursed for days patients spend in the hospital when they do not quality for hospital LOC.

LEAVING MONEY ON THE TABLE
The financial implications in these three examples are staggering when you factor that these projections are based on just 26 days. What is also interesting is that two of the three examples realized a percentage of LOC recommendations (28%) that was closely aligned with the percentage of time that weekends account for (29%). This speaks to the overall value that physician advisors bring as it pertains to patient care status, which is crucial for hospitals to maximize revenue.

WHAT IS YOUR HOSPITAL DOING THIS WEEKEND?
Physician advisor services add an extra support layer to in-house utilization management systems. Hospitals remain in control of when cases are sent to supporting physician advisors for second level review. Physician advisors focus on evaluating clinical information to triage patients smoothly into appropriate LOC and support timely discharges. This is particularly important during weekends and holidays when staffing may be low. This process optimizes reimbursement, addresses LOS, and supports patient satisfaction through the appropriate status determinations. Knowing these clear benefits, health systems must consider the value of weekend staffing in utilization management planning. Payers are not making it easy for hospitals. Hospitals need expert physician advisors available weekdays and weekends to provide guidance on LOC alignments. Hospitals should be looking for a partner like AppriseMD that provides timely reviews with no minimums and does not lock them into an annual contract.

Hospitalizations don’t stop on the weekend, and neither should utilization review.

SOURCES
1. Ranji, Sumant, MD, “The Weekend Effect,” Patient Safety Network, Agency for Healthcare Research and Quality.
January 1, 2017
2. Goode, Jeffrey, MD; Burke, Dan; Harper, Ben; and Richards, Barton S, “How to determine appropriate patient status and navigate observation-level care,” Healthcare Financial Management Association. March 16, 2023.
3. Centers for Medicare & Medicaid Services, “Hospital CAHPS.”
4. American Hospital Association, “Report: Inflation continues to burden hospitals as margins remain near zero,”
May 3, 2023.
5. American Hospital Association, “New AHA Report Finds Delays in Ability to Discharge Patients Increase Strain on Patients and Hospitals,” December 6, 2022.

ADDITIONAL SOURCES (reviewed but not cited)

• Reiner, Glen, "Success in Proactive Denials Management and Prevention," Healthcare Financial Management Association. May 18, 2021.
• Toh, Hui Jin, BEng; Lim, Zhen Yu, MBBS; Yap, Phillip, MBBS, MRCP; and Tang, Terence, MBBS, MRCP, “Factors associated with prolonged length of stay in older patients,” PubMed Central, National Library of Medicine. March 2017
• https://www.the-hospitalist.org/hospitalist/article/208285/mixed-topics/observation-versus-inpatient-status
• https://www.hfma.org/revenue-cycle/denials-management/utilization-review-5-reasons-hospitals-lose-revenue/
• https://www.statista.com/statistics/710469/total-annual-discharges-in-us-hospitals-by-state/
• https://www.aha.org/infographics/2020-07-24-fast-facts-infographics
• https://www.relias.com/blog/how-do-patient-satisfaction-scores-affect-reimbursement
• https://www.cms.gov/newsroom/fact-sheets/fiscal-year-fy-2016-results-cms-hospital-value-based-purchasing-program
• https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/HVBP/ Hospital-Value-Based-Purchasing
• https://www.fastcompany.com/90935458/laying-the-foundation-for-a-bright-future
• https://www.excel-medical.com/why-hospitals-make-more-money-on-inpatients-than-observation-patients/