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Oregon hospitals back bill to compensate them for patients with nowhere to go

Patients are increasingly stuck in hospitals due to shortages at long-term care facilities. Hospitals want the state to staunch their red ink.
February 7, 2023

More than 400 patients are stuck in Oregon hospital beds unnecessarily who can’t be discharged and don’t generate revenue, and now hospitals are asking the Legislature for financial relief.

The patients can’t be released because they still need care at one of the state’s skilled nursing or long-term care facilities — but those facilities lack staffing, creating a backup that is making it harder for hospitals to stay in the black. 

The Oregon Senate Health Committee on Monday considered Senate Bill 486, which aims to help hospitals with the financial burden from boarding due to ongoing logjams around discharging patients. The hearing highlighted the ripple effects of Oregon’s health care workforce shortage and raised questions over incentives around hospitals and nursing homes. 

The legislation directs the Oregon Health Authority to pay a daily rate to hospitals for Medicaid-funded Oregon Health Plan recipients who no longer require inpatient services but can’t be discharged because they need ongoing care in less-intensive settings where there are no beds open for them. The bill’s fiscal impact has not been released yet. 

“A local hospital with an open front door and a closed back door doesn't work even with the best efforts of our teams, especially when that hospital is not paid for all the care it provides,” Becky Hultberg, president and CEO of the Oregon Association of Hospitals and Health Systems, told the committee. 

Hultberg said the payments will help financially stressed hospitals with a growing problem that’s outside of their control. As of Friday, there were 446 patients waiting to be discharged from Oregon hospitals, according to numbers presented by Hultberg. Another 176 patients were boarding in emergency departments while waiting for a bed in a hospital.

By way of comparison, a 446-bed hospital would be among the largest in the state.

Delays in hospital discharges have worsened since the start of the pandemic, said Hultberg. Patients are currently staying on average 5.65 days in hospitals, up from the 4.7 day-average before the pandemic, she said.  

Those delays, she said, mean more stress for staff, patients and families. Hultberg said longer stays don’t mean more money for hospitals, which she said are typically paid a fixed rate based on the patient’s condition of diagnosis. 

“No one wants to stay in a hospital longer than they need to,” she said. “But these patients have nowhere else to go.”

The legislation would require the payments to come from the health authority or the state’s coordinated care organizations, which provide services to Oregon Health Plan members. The payments would apply to homeless patients. 

Andi Easton, the hospital association’s vice president of government affairs, told the committee they are asking for the bill to be amended to create similar payments for patients covered by commercial insurance.

Josh Balloch, vice president of government affairs for Southern Oregon-based coordinated care organization AllCare Health, questioned the legislation. He said Medicaid is already paying for appropriate hospital stays and the bill was prompting “the wrong conversation.”

“We need a conversation to actually figure out how to address the other holes that are actually creating the bottleneck in the hospital,” he said. 

Balloch called for more skilled nursing facilities, residential treatment options and home health care options rather than “paying to fill up these hospital beds.” He noted that reforms to the Medicaid-funded Oregon Health Plan a decade ago were intended to eliminate perverse incentives that rewarded the provision of costly care.

“This is actually pushing back the other direction,” he said. 

Jessica Adamson, executive director of state government and public affairs for Providence Health and Services, told the committee that the hospital system supported the bill. 

State Sen. Deb Patterson, a Salem Democrat who chairs the committee and sponsored the bill, asked what was preventing a large, well-resourced health system like Providence from opening up another floor or wing for long-term care. 

Adamson responded that Providence has opened up intermediate discharge beds during the pandemic but the state’s largest health system faces challenges in addressing this problem. She said there are waits for patients to receive needed guardianships or approval for enhanced Medicaid services to get the appropriate care after leaving the hospital. She said not all patients qualify. 

“It’s not always real easy just to open up beds,” she said. “There’s the same workforce challenges that we face in the hospital (that) exists for long-term care.” 

You can reach Jake at [email protected] or via Twitter @jakethomas2009.