Category: Inpatient Practice

A study from the Kaiser Family Foundation recently found that 1 in 8 American adults are taking a GLP-1 receptor agonist for either weight loss or diabetes. The implication is that 12% of the hospital visitors and hospital stafff who eat at hospital cafeterias are taking these drugs. An additional 6% of adults have used GLP-1 drugs in the past. GLP-1 drugs not only reduce overall appetite, but they also change food preferences in people who take them. Hospital cafeterias are in a unique position to both accommodate these changes in food preferences and also educate the public about healthy eating while taking GLP-1 receptor agonists.

What are GLP-1 receptor agonists?

In 1983, researchers at the University of Chicago found that the glucagon gene could produce more than just one peptide because of tissue-specific post-translational processing. One of these hormones produced by the glucagon gene was glucagon-like peptide-1, also known as GLP-1. Although naturally occurring human GLP-1 seemed to have some promising metabolic effects, it had an extremely short half-life. So it did not appear to have much promise as a therapeutic agent. But in 1992, a researcher at the VA medical center in New York was studying peptides found in Gila monster venom. One of these peptides was almost identical to human GLP-1 except that it lacked a single crucial alanine residue. As a result, it was resistant to enzymatic degradation and had a much longer half life. This led to the FDA approving the first GLP-1 analog, exenatide, in 2005. Exenatide was sold under the brand name Byetta and used to treat type 2 diabetes.

During the initial clinical trials of extenatide in diabetes, researchers noticed that there was an unexpected side effect, namely, weight loss. As additional longer acting GLP-1 analogs were created and studied, the weight loss became more apparent. In 2021, the first GLP-1 agonist was approved by the FDA specifically to treat obesity. In the 5 years since, GLP-1 agonists have revolutionized the way that we treat obesity. Most people who take GLP-1 agonists for obesity will lose 15% – 25% of their body weight in the first year of treatment. Two months ago, the FDA approved the first oral GLP-1 agonist, Wegovy, making these drugs even more accessible. Within the first 2 weeks of oral Wegovy’s launch, 26,000 prescriptions were written and this number is expected to increase dramatically by the end of 2026.

Changes in food preferences by people taking GLP-1 agonists

A study published last month in JAMA found that when people take GLP-1 agonists, their food preferences change. The study looked at 13,565 people in Denmark who donated their grocery store receipts. Those taking GLP-1 drugs were matched 1:3 with controls of the same age, gender, and income. For those taking GLP-1 drugs, food category purchases were compared from before to after starting the drugs. Compared to controls, those taking GLP-1 drugs had a drop in total calorie consumption, sugar consumption, carbohydrate consumption, and saturated fat consumption. Protein consumption increased after staring GLP-1 drugs. In addition, there was an increase in consumption of unprocessed foods and a significant decrease in ultraprocessed foods when taking GLP-1 receptor agonists.

GLP-1 receptor agonist users also decrease their overall grocery purchases. A study published in the Journal of Marketing Research in December 2025 found that when a household has at least 1 member taking a GLP-1 drug, grocery purchases drop by 5%. The food category most affected was calorie-dense processed foods, such as chips, that dropped by 10%. Currently, 20% of American households have at least one member taking GLP-1 drugs.

Another study by PwC found that GLP-1 drug users have a 33% reduction in alcohol consumption, 84% reduction in dessert consumption, and a 70% increase in fresh produce consumption.

Food producers have responded to the changing preferences of people taking GLP-1 receptor agonists. For example, Greek yogurt sales have skyrocketed, particularly for products like Oikos Triple Zero Greek yogurt with a high protein content and no added sugar. Last year, Conagra began adding a GLP-1 friendly label to packaged foods to make them easier for users to spot on grocery store shelves.

What should hospital cafeterias do?

The GLP-1 drug revolution represents a unique opportunity for hospitals both to optimally serve the increasing population of people taking these drugs and to educate customers (and hospital staff) about healthy eating. Here are some specific tactics hospital food services departments can take:

Changing food and beverage offerings

• Increase availability of high protein, low sugar foods such as zero sugar added Greek yogurt, chicken entrees, shrimp entrees, and fish entrees.
• Increase offerings of fresh fruits and vegetables.
• Reduce sugar-added soft drinks and juices by putting them on lower shelves than diet soft drinks and bottled water. Also, put more bottles of diet soft drinks and water than sugar-added soft drinks in refrigerated shelves to signal to customers that these are the preferred beverages.
• Stock 16 ounce cans and bottles of diet soda and water but only stock 8 or 12 ounce cans and bottles of sugar-added sodas to encourage sugar-free drink purchases.
• Eliminate or reduce available package sizes of ultraprocessed snack foods, such as chips.
• Stock packages of nuts and seeds as alternatives to chips.
• Reduce serving sizes of desserts.
• Ensure daily high protein vegetarian entrees are available such as rice and bean, lentil, quinoa, tofu, and edamame dishes.

Healthy eating education

• Label foods as being “GLP-1 smart choices” to help GLP-1 drug users know which foods best complement GLP-1 receptor agonists for weight loss. This should not only include low-calorie, high protein foods but also include sugar free drinks.
• Create signage that indicates the calorie, protein, and carbohydrate contents of all food and beverage offerings.
• Create posters or table placards that state in simple terms what foods best complement GLP-1 drugs and what category of drugs to avoid, such as the example below:

Hospitals should be the leaders, not the followers

American food manufacturers see the GLP-1 drug writing on the wall and are already producing and promoting food products at our grocery stores that are GLP-1 friendly. But there are gaps – for example, a head of broccoli or a head of lettuce will probably never carry stickers promoting their benefits for GLP-1 drug users. Grocery stores are never going to try to dissuade customers from buying beer, Cheetos, or cartons of Coke because these products have a high mark-up and grocers make a lot of profit from their sales. Similarly, McDonalds is never going to encourage customers to avoid buying Big Macs and fries.

But hospital cafeterias have a dual mission of feeding hospital visitors and hospital staff as well as improving community health. Hospitals can fill the gaps left by grocery stores and fast food restaurants when it comes to helping GLP-1 receptor agonist users lose weight by offering food options that complement GLP-1 drugs and by providing education about these food options. And the benefits go way beyond GLP-1 drug users – it turns out that the foods that complement GLP-1 drugs are also foods that form a healthy diet for the vast majority of Americans.

This is a tremendous opportunity. Make sure that your hospital’s food services department takes advantage of it.

February 23, 2026

Over 33 years of practice, I’ve interviewed hundreds, if not thousands of doctors – from residency applicants, to fellowship applicants, to hospitalists, to specialists, to medical directors, and to CEOs. And I’ve missed some things, sometimes really, really important things, that have come back to haunt me later on. Here are some of the warning signs that the doctor that you are interviewing is going to end up being a problem after he or she is hired.

1. They’ve been arrested for something. Most hospitals will have some question on the application like “Have you ever been convicted of a crime other than minor traffic violations?“. We hired a doctor who truthfully answered “no” to that question but he had actually been accused by multiple women of lewd behavior and sexual assault. In fact, there were plenty of articles about him in his local newspaper that I only found out about after we hired him (we suspended and then fired him as soon as we knew about it). I learned my lesson and started Googling every candidate’s name with associated key words like malpractice, crime, and lawsuit. On several occasions, I found out that physician applicants were involved in multiple civil suits or had been indicted but not convicted of serious crimes. The lesson is, always Google the applicant.
2. Stuff they post on social media. I personally do not have a Facebook, Instagram, or X (Twitter) account and really don’t have any use for them. But you can learn plenty about me by my blog posts. If the applicant has social media accounts with public access, always see what they have to say and what pictures they post. You don’t want to hire a doctor that regularly re-tweets racist tweets or a doctor who proudly posts pictures of himself passed out drunk at a party.
3. Swastika tattoos. Job applicants usually keep their tattoos covered up during interviews and then you don’t know what is tattooed on their forearms until they are wearing scrubs in your ICU 6 months later. Most people take no more note of the details of tattoos than they would the print details on a necktie or blouse. But a person’s tattoos tell you a lot about them. If an applicant’s tattoos are visible, take a careful look at them to be sure that they won’t be offensive if viewed by hospital staff or patients. Don’t hire a doctor with a naked woman tattoo visible on his arm or any kind of tattoo that could be seen as racist, political, or otherwise socially unacceptable.
4. Time period gaps. Most job applications require the applicant to list the dates of the training programs and previous jobs that they have held. From that you should be able to construct a timeline of everything that applicant has done since graduating from high school. Gaps in time are a red flag and you need to specifically ask the applicant what they were doing during those time periods. Usually, these gaps are innocuous: studying for a board exam, maternity/paternity time, etc. But the chances are that the applicant is not going to list on the CV the 4 months that they were in a mental hospital because of catatonic schizophrenia.
5. Drug and alcohol convictions. Most physician job applications have a check box with a question something like “Have you ever been addicted to alcohol or drugs?“. Many applicants will check the “no” box for that question because they don’t consider themselves to have an alcohol or drug problem. But the applicant who has had 3 DUIs has an alcohol problem no matter what the applicant thinks and you shouldn’t hire that physician unless he/she has completed an alcohol rehabilitation program. I had one physician applicant who had been arrested twice for DUI violations but in both cases, his attorney was able to get the charges dropped on technicalities so they did not show up on his job application. It is best to have a question like: “Have you ever been charged with a DUI offense or illegal drug offense?”.
6. Always call the professional references. As a species, doctors usually write positive or at least neutral letters of recommendation for their colleagues. Sometimes, it is because we are trying to get rid of a problem doctor by helping them get a job elsewhere. Professional references will usually give you a more honest opinion if you call them on the phone and speak with them confidentially. One of our particularly problematic division directors looked great on paper and her reference letters were all fine. It was only after we hired her and someone ran into a couple of those references at a medical meeting that we found out that she was abusive, didn’t get along with anyone, and entire medical staff was delighted to see her leave their hospital. If a doctor’s professional references won’t return your calls, that should also be a red flag – it may mean that they are trying to distance themselves from that particular physician. Also, beware of the applicant who only lists references from many years ago – it may mean that the applicant has developed personality problems that any recent reference would have mentioned.
7. They make jokes that aren’t funny. A fellowship applicant once told me during the interview that he wanted to become a critical care physician “Because critical care is like internal medicine on crack!“. OK, so exactly how do you know what being on crack is like? We didn’t hire him.
8. They failed their board exam the first time they took it. I get that not everyone passes the board exam on the first go. People sometime have bad days – maybe they were up all night the night before the exam because one of their kids was sick. Or maybe they had a recent death in the family. But doctors have to re-take board exams every 8-10 years and if they can’t pass those recertification exams, they won’t be board-certified. And if they aren’t board-certified, they can’t stay on the hospital medical staff. At the least, doctors who fail the board exam once will likely need your attention in the future to ensure that they go to board preparation courses, etc. so that they don’t fail their future recertification exams. I’ve had to personally tutor hospitalists who failed their internal medicine board re-certification exams in order to help them pass them the second time around and to keep them on our medical staff.
9. They move around a lot. There are several reasons why a doctor might change jobs frequently. Sometimes it is because they have a spouse who has to relocate frequently because of job transfers. But sometimes it is because they are ambitious and trying to rapidly climb the medical leadership ladder. And sometimes it is because they can’t get along with doctors and nurses at all of their previous jobs. Regardless, the doctor who frequently changes jobs warrants scrutiny. If it is because of ambition, then that doctor may do a great job for you but will likely leave for the next promotion opportunity in a year or two. If it is because they don’t get along with others, then you’re going to spend an inordinate amount of time doing conflict resolution if you hire them.
10. They cleaned out the hotel minibar. We interviewed a moderately famous physician for a division director job. She looked great on paper and interviewed well over the 2-day visit. When we got the bill for her hotel stay, there was a huge charge for the hotel minibar. It turns out that she packed up everything in the minibar and took it with her when she left. We didn’t ask her back for a second interview.
11. They are too successful in research. In academic medicine, we frequently judge physician candidates for leadership jobs by their research productivity. After all, it is easy to quantify research success based on a candidate’s number of grants and publications. But all too often, successful physician researchers make terrible leaders. Research success is all about your own personal accomplishments. But success in leadership is all about fostering accomplishments of everyone around you. I interviewed a candidate for the chairman of a different department who had an enormous CV full of millions of dollars of research grants and publications numbering in the hundreds. Although he interviewed well, I was very skeptical and gave him a thumbs down. But the dean of the college wanted him in order to bolster the department’s research productivity. Within 6 months of arrival, he was fired because he completely mismanaged the clinical activities of the department and belittled the clinical faculty as second class citizens compared to the research faculty. With the department losing money from declining clinical revenue and unhappy physicians leaving the department, the dean had no choice but to remove him and start the job search all over again. Division directors, department chairmen, and deans get their jobs based on their research success but lose their jobs based on their financial failures.
12. They say dumb stuff at the recruitment dinner. I have a personal rule for recruitment dinners – get a non-alcoholic beer when no one is watching. That way, everyone thinks I’m drinking but I’m actually trying to keep my mind sharp so that I can observe the candidate’s behavior. If I can’t get a non-alcoholic beer without others knowing it, I order a beer that I don’t particularly like and nurse it all evening. Candidates usually let their guard down at dinner and it gives you a better idea of how they are likely going to behave in the hospital. If they are rude to the restaurant staff, they’ll be rude to the hospital staff. I was at a recruitment dinner once when the doctor called the waiter over to tell him that table’s bottle of wine was “corked” (i.e., suffered from cork taint) – she might has well stood on a chair and shouted: “I’m a prima donna!“. We didn’t hire her.
13. They ask inappropriate questions. I interviewed a division director candidate once who looked very promising on paper and had a long list of publications. We had hired a search firm to help identify candidates and the firm’s consultant told me that this particular physician was the best candidate he had seen in years. During his interview, the candidate asked me whether as the division director, he would be allowed to put his name on all of the articles published by the division’s faculty members. That questions showed that he saw the job as a means for his personal benefit and not as a means of benefiting anyone else around him. We hired someone else.
14. They don’t make eye contact during the interview. I think I’m pretty good at recognizing overt psychopathology during an interview but I have more difficulty recognizing more subtle personality disorders. One of the things that I can reliably judge during the interview is communication skills. If candidates babble on and on during the interview, they will babble on and on during teaching rounds and faculty meetings. If they don’t make eye contact with you as an interviewer, they likely won’t communicate well with patients, either.
15. They talk down about their previous or current employer. I acknowledge that physicians usually change jobs because the new job offered something more than the last job. The emotionally mature candidate will put their desire for a job change as a positive, such as “I’ve had a good job at my current hospital but I see more opportunities to grow professionally at your hospital.” The candidate that says derogatory things about their current or past employer will have no qualms about saying derogatory things about you.
16. They don’t dress the part. I don’t expect a physician candidate to come wearing a tuxedo or an evening dress but I do expect at least a minimum of formality in attire. I had a hospitalist candidate show up for his interview wearing jeans, an untucked golf shirt, and sneakers. I figured if he showed up that way for his interview with me, he would likely show up that way to take care of patients. We didn’t hire him.
17. They show up late. Okay, I accept that there can be traffic jams, canceled flights, and car flat tires. But a candidate that is late for the interview better have a really, really good excuse. Otherwise, that candidate is also going to be likely to show up late for work, for meetings, and for rounds.
18. They focus too much on time off and salary. I understand that these are questions on every candidate’s mind but the initial job interview is not the time to be excessively asking about the number of vacation days and salary structure. It comes across as pointing toward the candidate as a potential problem child, and not a team player.
19. They run another business. Personally, I like it when physician candidates have outside hobbies and activities. I think they keep the physician grounded and help promote sanity. But a second job can become a time conflict. I interviewed a division director candidate who had started a company manufacturing a medical device that he had designed. He was world famous and had a lot of invited lectures on his CV. I was skeptical but we hired him anyway. He continued to travel regularly for invited lectures and company board meetings to the point that he was gone from the hospital more than he was there. One night when he was on call, I was covering our ICU and I paged him – he was in another state. I like physician candidates who are mildly famous, but not too famous. A second job can be a conflict of time.
20. Expertise out of proportion to typical training experiences. I had a family medicine residency graduate who was interviewing for a hospitalist position claim that he had performed dozens of central venous catheter placements, arterial lines, and endotracheal intubations. He even produced procedure logs as confirmation. Family medicine residents rarely have this much experience performing ICU procedures. But things seemed in order so we hired him and credentialed him for those procedures. Within weeks, he had left a guide wire in a patient during a central line placement and caused a pneumothorax during another line. He repeatedly needed to call for back-up after inability to successfully place endotracheal tubes in emergencies. I suspect that he doctored his procedure logs from residency. We let him go before the end of his probationary period.

March 11, 2025

Last month, the fall 2024 Leapfrog hospital safety grades were released, giving nearly 3,000 U. S. hospitals safety grades of A through F. I was very happy to see that my former hospital, Ohio State East Hospital, received an “A”, but I was surprised to see that another hospital just 2 miles away, that I know also provides great care, received an “D” grade. This is the 23rd year of the Leapfrog reports and it has evolved considerably over those years. Leapfrog’s goal is to answer the question “How safe is my hospital?“. With its first report in 2002, I had a lot of concerns about the validity of the scoring system used by Leapfrog. But has Leapfrog overcome those concerns?

Who rates hospitals?

Hospitals are graded by many different organizations. The big 3 are The Joint Commission, individual state departments of health, and CMS. In addition, there are a myriad of organizations that provide accreditation or certification for individual hospital services, for example, AACVPR certification for cardiac rehabilitation programs and the College of American Pathologists accreditation for hospital clinical labs.

The Joint Commission is a non-governmental organization that accredits U.S. healthcare organizations and programs. Participation is voluntary but many insurance companies use Joint Commission accreditation as a basis for determining in-network hospitals and in negotiating reimbursement rates. The Joint Commission accreditation hinges on unannounced site surveys that occur approximately every 3 years. Although there are alternatives organizations that accredit hospitals, The Joint Commission has the advantage of being approved by Medicare. Consequently, 70% of U.S. hospitals participate with the Joint Commission at a cost of an average of $46,000 per year.

State departments of health license hospitals to operate. These departments generally perform periodic surveys and inspections for hospitals to maintain licensure. However, in most cases, there is not a state department of health grade associated with licensure, only a yes/no designation of whether or not the hospital has a license to operate.

The Centers for Medicare and Medicaid Services (CMS) operates a website that grades hospitals on a one to five star scale based on data derived from Medicare bills as well as hospital self-reported data for metrics such as ER wait times and the percentage of healthcare workers who are up to date on COVID and influenza vaccines. The star rating system was first implemented in 2007. CMS also provides a separate star grade based on satisfaction surveys sent to patients after hospitalization.

The Leapfrog Group

In 1999, the Institute of Medicine issued a report titled “To Err is Human” that claimed that 98,000 Americans died each year due to medical errors occurring in hospitals. The implication was that 1 out of 25 people die from a medical error in a hospital. In response to this report, the Leapfrog Group was started by a group of business leaders in 2001. At the time, the CMS hospital star ratings did not exist. Large companies wanted to be sure that they were getting good value for the healthcare insurance premiums that they were paying to insurance companies and did not want to pay insurance companies to send employees to hospitals where those employees had a high risk of complications that could delay or prevent their return to work. At issue was that insurance companies were primarily motivated to provide the lowest cost of healthcare whereas the employers were additionally motivated by the desire to keep employees healthy enough to be able to stay in the workforce.

The first Leapfrog survey was very simple and looked at 3 things: (1) whether hospitals had computerized physician order entry, (2) whether ICUs were staffed appropriately with intensivists, and (3) whether hospitals had high surgical volumes for certain high-risk procedures. Beginning in 2012, Leapfrog began assigning letter grades based on its annual surveys. In the first years, the Leapfrog Group surveys were heavily criticized as being well-intentioned but inaccurate and misleading. Since that time, the survey has expanded to cover more items and require more documentation in an effort to improve its relevance. The current survey is 330 pages long and covers 22 different measures of patient safety. Each measure requires answering a number of questions. Each question additionally requires hospitals to submit documentation to back up the answers to those questions.

Leapfrog does not survey all hospitals. For example, pediatric hospitals, critical access hospitals, VA hospitals, and specialty hospitals are not included. Of the approximately 3,000 hospitals that Leapfrog invited to submit surveys, 2,200 actually responded this year. In the previous report (spring of 2024), 30% of hospitals received an “A”, 26% received a “B”, 37% received a “C”, 7% received a “D”, and <1% received an “F”.

The problems with the Leapfrog Survey

• Completing the survey is onerous. Realistically, it will take one person a couple of weeks working full-time to complete the survey. For example, for the single question of whether the physicians covering the ICU are board certified in critical care, the hospital has to provide the physician call schedule for the ICU for every day for the last 3 months and provide a copy of each physician’s current board certification in critical care. For a large hospital, with multiple different ICUs, this can involve dozens of physicians who have variably obtained critical care board certification from either the American Board of Internal Medicine, Anesthesiology, Pediatrics, or Surgery. Ask any administrative staff member who has been responsible for compiling Leapfrog survey materials and he or she will tell you that it is a confusing, complicated, time-consuming, and all-around unpleasant process.
• It penalizes hospitals that do not submit surveys. The Leapfrog Group will give your hospital a letter grade whether or not you respond to a survey. If you do not respond, Leapfrog obtains as much information as possible from public sources, such as the CMS website. Leapfrog states: “If a hospital performs well on certain measures on the Leapfrog Hospital Survey, they have the opportunity to earn more points in their Hospital Safety Grade for those certain measures than they would if they did not report to the Leapfrog Hospital Survey.” Currently, about three-quarters of eligible hospitals submit surveys. For some hospitals, this can feel like extortion – by not filling out the survey, you risk getting a lower publicly reported grade than you would have if you filled out the survey.
• It focuses on hospital processes and not on outcomes. The Leapfrog survey centers around workforce staffing, specific hospital policies, use of electronic medical records, and volume of surgical procedures performed. These are variables that in the literature have been shown to be associated with better patient outcomes. However, the Leapfrog survey does not tell you much about actual patient outcomes at specific hospitals.
• It is heavily weighted on surgery and ICU care. Since the beginning, Leapfrog has been all about ICU staffing and surgical volume. These are two areas that were of particular concern to the companies that founded Leapfrog because the ICU and the operating room were targeted in the Institute of Medicine’s 1999 report “To Err is Human”. These companies wanted to be sure that their employees who underwent elective surgeries or had catastrophic injuries or accidents resulting in ICU care were able to return to the job after their operation or ICU stay. The Leapfrog grade tells you relatively less about other types of care including non-ICU medical conditions, primary care, preventive medicine, etc.
• There is a poor correlation between the Leapfrog grade and other rating systems. A 2017 study found that there was there was only a relatively weak association between the Leapfrog safety grade and compulsory Medicare outcomes and penalties. Since 2012, twelve hospitals have received “A” grades each year but only half of these received a 5/5 star rating from CMS. This is primarily because Leapfrog and CMS use different metrics and weight metrics differently when assigning a hospital its rating.
• Leapfrog makes its money from the ratings. According to the most recent Leapfrog Annual Report, it had revenues of $6,974,962. Of this amount, 78% ($5,434,948) came from the sale of reports and licensing fees. Hospitals that want to use their annual Leapfrog grade in advertising must purchase a license agreement from the Leapfrog Group. For a 500-bed hospital, this costs $29,900.

So, should you care about your hospital’s Leapfrog grade?

At its inception, the Leapfrog rating provided ground-breaking data about individual hospital safety practices. Since that time, other organizations have created competing rating systems. There is still value in the Leapfrog Safety Grade, however. Other organizations, such as The Joint Commission, only give a yes/no accreditation. This is like getting a pass/fail grade for a class rather than a letter grade and it is impossible to know which is the best hospital among all of the hospitals accredited by The Joint Commission. In this regard, the Leapfrog letter grade is akin to the CMS star rating, allowing consumers to compare one hospital to another when making a choice of which hospital to utilize. However, the Leapfrog Safety Grade and the CMS star rating measure different things, so they should be viewed as complimentary rather than competitors.

A problem with all rating systems that give hospitals one single grade is that each hospital has different outcomes for different medical conditions. A single overall hospital grade can result in over-generalization of the care of different conditions. For example, assume two hospitals have identical Leapfrog grades but one hospital may have great orthopedic surgery care and the other has terrible orthopedic care but a great obstetric unit. A pregnant patient would be well-advised to choose a hospital based on its obstetric care rather than its hip replacement surgery outcomes.

In the ideal world…

I spent far too much of my life compiling various accreditation and certification surveys, preparing for site surveys by The Joint Commission, and generating quality reports for an endless number of organizations and agencies that rate, review, license, accredit, certify, or otherwise judge hospital care. The Leapfrog Safety Grade survey has grown from something that I could do myself in just a matter of minutes to a behemoth that now takes a whole department of administrative staff days or weeks to complete.

Hospitals are straining at the time and expense to complete all of the various surveys for organizations that rate them. Given the similarities between the CMS star rating and the Leapfrog safety grade, it would be ideal to combine the two. Those who advocate for less government might argue to outsource a single rating system to the private sector (i.e., Leapfrog). However, a considerable component of the Leapfrog grade is based on Medicare data derived from protected personal information on individual patients – I personally do not want my entire medical history, social security number, address, etc. being exported from Medicare to a private company. It would be preferable for CMS to adopt the good things about Leapfrog and incorporate them into the CMS star rating. Having two hospital rating systems with so much overlap creates too much hospital administrative costs that then get passed on to consumers. It’s time to improve hospital administrative efficiency.

December 12, 2024

Artificial intelligence (AI) is causing a paradigm shift in the education, business, and legal professions. But AI is also poised to irreversibly change the way medicine is practiced. Jobs that traditionally relied on extensive training by memorization may be able to be performed as well (or better) by AI than by humans. Jobs that have relied on image analysis or sound pattern analysis are also at risk of being displaced by AI.

Let me give you an example from my hobby of birdwatching. In the past, bird species identification relied on comparing a bird that you saw in a tree to a drawing or photograph in a bird identification book. To become an expert birder, you needed thousands of hours of birding to identify birds by their calls and by their seasonal plumage. But now, we have the Merlin app. When birding, I can turn on my phone’s microphone and Merlin will identify bird species by bird calls. I can take a photograph of a bird, upload it to the app, and Merlin will tell me what bird I saw. With Merlin, even a novice birder like me can identify birds like a seasoned expert.

So, what if we have the Merlin app equivalent to identify heart sounds by auscultation? Or diagnose a rash by a photograph? Or interpret CT scan images? Or read cytology specimens on microscopic slides? Like it or not, artificial intelligence is coming to medicine and it will make many skills traditionally requiring hundreds of hours of training, obsolete.

Artificial intelligence and advance practice providers

To become a primary care physician (general internist, general pediatrician, or family physician) requires 11 years of education and training after high school. To become a nurse practitioner (NP) or physician assistant (PA) only requires 6 years of training after high school. As a result, it is far less expensive to become an NP or PA than to become a primary care physician but the trade-off is that NPs and PAs generally have a  lower annual income than physicians. However, if the salary of an NP and a primary care physician was the same, most hospitals would prefer to hire the physician under the presumption that additional 5 years of training to be a primary care physician would translate to greater skill and knowledge than the NP or PA. On the other hand, if the skillset and knowledge of an NP or PA was the same as that of a primary care physician, most hospitals would prefer to hire the NP or PA because they are cheaper.

Artificial intelligence now offers the possibility of eliminating the need to acquire many of the skills and much of the knowledge currently required to become a physician. This offers a future where an NP armed with a few AI apps may be able to perform many of the tasks currently relegated to physicians.

Need to diagnose a child with a fever and a rash? There’s going to be an app for that. Need to decide the best blood pressure medication to prescribe for a patient with newly diagnosed hypertension? There’s going to be an app for that. Need to recommend follow-up of a pulmonary nodule given a patient’s age and smoking history? There’s going to be an app for that.

The FDA and medical devices

At first glance, it would seem logical to embed artificial intelligence into electronic medical record (EMR) software programs. After all, the EMR is the database of all information about a patient – their blood pressure, their family history, their medication list, etc. However, a barrier to incorporating AI into the electronic medical record is that the U.S. Food and Drug Administration considers AI to be a medical device whereas the electronic medical record is just considered a documentation tool. Medical devices are regulated differently than documentation tools. Medical devices require extensive clinical trials and then FDA approval; documentation tools do not. Clinical trials and FDA regulation are very expensive and can pose a barrier to regular EMR software upgrades. For these reasons, the major electronic medical record companies have been reluctant to incorporate artificial intelligence algorithms into their EMR programs.

For the most part, this makes sense. You don’t want to have an artificial intelligence program to recommend a chemotherapy regimen for advanced lung cancer unless it has been shown in clinical trials to be accurate and has been approved by the FDA. The fear of the electronic medical record companies is that if their EMRs become classified as medical devices, then they will have to get FDA approval every time they want to change the font size in their blood chemistry test results in the EMR. So, at least for now, the electronic medical record and artificial intelligence programs will need to be separated, and that means that there will have to be a human to do a history and physical examination and then to interface between the EMR and the AI. But in many situations, that human can be an NP or a PA, rather than a physician.

Artificial intelligence and primary care

Much of primary care is based on clinical practice guidelines. The U.S. Preventative Services Taskforce has guidelines for everything from colon cancer screening to pre-exposure prophylaxis to prevent HIV. The American College of Cardiology has a hypertension diagnosis and management guideline. The Advisory Committee on Immunization Practices has guidelines for childhood and adult vaccination schedules. And the American Diabetes Association has a guideline for the prevention, diagnosis, and treatment of diabetes. If you roll all of these clinical practice guidelines into one artificial intelligence program, then you have the majority of primary care medicine routine visits covered.

As a medical student, I spent hours memorizing vaccination schedules, hypertension treatment algorithms, diabetes medication drug interactions, and the staging systems for various cancers. And guess what? An artificial intelligence program can do all of these things better than my memory allows me to do. In other words, AI eliminates the need for much of the education and training that we currently require in medical school and residency. Artificial intelligence will allow a practitioner with lesser training (such as an NP or PA) to be just as good as a physician when it comes to preventative care medicine and algorithm-based management of most common medical conditions.

However, artificial intelligence is not infallible

Artificial intelligence is actually not new in medicine. I’ve been using simple forms of AI for decades. Every EKG and pulmonary function test that I have ordered in the past 30 years that comes with a computer interpretation has incorporated rudimentary AI into those interpretations. These interpretations programs are fairly good at identifying normal but invariably come up with an incorrect diagnosis in a substantial percentage of those tests that are abnormal. So, before I am willing to allow an AI program to diagnosis breast cancer from a histopathology slide and before I am willing to allow an AI program to diagnose idiopathic pulmonary fibrosis from a chest CT scan, these programs are going to have to get very, very good. Until then, the use of artificial intelligence for more complex pathologic and radiologic diagnoses will supplement rather than replace a physician.

And then there is legal liability…

If a radiologist misses a lung cancer on a chest X-ray, the radiologist is named in a medical malpractice lawsuit. If a patient dies of sepsis when a hospitalist made an incorrect antibiotic choice for the patient’s pneumonia, the hospitalist is named in the malpractice suit. But if an artificial intelligence program misses the lung cancer or selects the wrong antibiotic, who gets named in the malpractice case? The company that created the AI program? The hospital that purchased the AI program? The FDA that approved the program? The physician who entered the patient’s clinical data into the program? All four of them?

Currently, a physician in primary care practice will pay about $12,000 per year in malpractice insurance premiums whereas a primary care nurse practitioner pays about $1,200. The reason for the 10-fold difference is that in most situations, a nurse practitioner is understood to be working under the supervision of a physician and that physician is ultimately responsible or at least shares responsibility for the management of patients seen by the nurse practitioner.  Artificial intelligence is likely to be similar – if it is considered to be a medical device then that device will need to be used by a licensed medical practitioner who will have the greater burden of malpractice liability. Clearly, laws will need to be written to clarify liability before artificial intelligence can be autonomously implemented in clinical practice.

Who will AI benefit the most – nurse practitioners or physicians?

A recent study from MIT researchers found that artificial intelligence has the greatest impact on the least skilled workers. Workers who were new or had low skills were helped more by AI than highly skilled workers. In other words, AI allows those with less training to be “upskilled” much more than those with advanced training.

Extrapolating from this study, it is likely that nurse practitioners and physician assistants will derive greater benefit from artificial intelligence than physicians. Artificial intelligence can make up for the fewer years of training that it takes to become an NP or PA.

Which physicians are most vulnerable to being displaced by artificial intelligence?

Although artificial intelligence has received a lot of press about its potential in radiology, I would argue that primary care physicians are most vulnerable to being displaced by artificial intelligence. Notice that I used the word “displaced” rather than “replaced”. That is because artificial intelligence is likely to be used to supplement a practitioner rather than become a practitioner, at least in the foreseeable future. In this regard, an NP or PA using an artificial intelligence program can replicate much of the skillset of a primary care practitioner. Thus the combination of an NP or PA plus an artificial intelligence program will together displace the primary care physician.

Physicians who are the least vulnerable are those who perform procedures such as surgeons and interventional cardiologists. Although this could change in the future, for now, no AI program or nurse practitioner is capable of independently performing a hip replacement surgery or a coronary artery stent placement. In primary care practice, the office procedures are far less complex – cerumen removal, IUD placement, and laceration suturing can be performed by an NP or PA and do not require a physician.

Also less vulnerable are physicians who are highly specialized. For example, an artificial intelligence program for brain MRI imaging will need to be used under the supervision of a practitioner who can confirm or contradict the AI’s findings. This will require a practitioner who is already an expert in brain MRI image interpretation, in other words, a physician specializing in neuroradiology. Artificial intelligence can still benefit the neuroradiologist, however, by serving in a capacity similar to that of a radiology resident who performs a preliminary read of the MRI that is then over-read and confirmed by the attending neuroradiogist.

“I’m a medical student, should artificial intelligence affect my career choice?”

The answer is… maybe. Fully implemented artificial intelligence in medicine is still a long way off. There will have to be significant improvements in software, significant legal liability questions resolved, and supervision requirements defined. However, if AI can replace certain medical specialists at a lower cost, then economic theory indicates that it eventually will. General internists, general pediatricians, and family physicians may be more vulnerable to displacement than other specialties, especially if the field of medical artificial intelligence matures coincident with an increase in the number of nurse practitioners and physician assistants. However, when it comes to cajoling a cardiologist to add in a patient with chest pain to their already full Friday afternoon schedule, an AI program simply cannot replace a persuasive family physician. The primary care physician may become more of a manager: coordinating care and overseeing a group of nurse practitioners who each have access to the artificial intelligence program.

Things are about to get interesting…

Change in medicine is inevitable but initial resistance to change is also inevitable. When electronic medical records were initially implemented, physicians universally hated them and many refused to use them. Now, no physician in his or her right mind would want to return to an era of paper records kept in manila folders. Ten years ago, the idea of driverless vehicles was met with skepticism but today, you can order a driverless Waymo taxi in San Francisco and you can buy a driverless John Deere tractor to plow your farm.

Artificial intelligence is coming in medicine and its widespread implementation is unavoidable. The question is whether it will augment physicians or displace physicians. I believe that it will do both, depending on the specialty.  From my vantage point, primary care physicians may be the most vulnerable to displacement. And employment opportunities for NPs and PAs are looking bright.

August 30, 2023

In March 2023, the U.S. Drug Enforcement Agency (DEA) announced new education requirements for all physicians applying for new or renewal DEA licenses. This was the result of provisions in the Consolidated Appropriations Act of 2023 that enacted a one-time requirement of 8 hours of continuing medical education (CME) on the treatment and management of patients with opioid or other substance use disorders. The requirement went into effect on June 27, 2023. Because DEA licenses are renewed on a rolling 3-year basis, all physicians with DEA licenses must meet this requirement sometime in the next 3 years.

Another provision of the Consolidated Appropriations Act of 2023 was to eliminate the DATA-Waiver (X-Waiver) Program that was previously required for physicians to prescribe buprenorphine. In the past, hospitalists, emergency medicine physicians, and other practitioners needed to obtain an X-Waiver to initiate buprenorphine when patients with opioid use disorder were admitted to the hospital or seen in the emergency department. Because only a small number of physicians took the time and effort to obtain an X-Waiver, the requirement was seen as a barrier to getting patients started on treatment. Now, any practitioner with a current Drug Enforcement Administration (DEA) registration may prescribe buprenorphine for opioid use disorder (if permitted by state law). The trade-off for elimination of the X-Waiver was the requirement that all practitioners with a DEA license be trained in the treatment of opioid use disorder, including the use of buprenorphine.

Who does this affect?

Any practitioner with a DEA registration must meet this requirement. This includes physicians, dentists, nurse practitioners, and physician assistants. However, only practitioners who prescribe controlled substances need to register with the DEA and obtain a DEA number. Although the majority of U.S. physicians have DEA numbers, some physicians do not, either by nature of their practice (for example, pathologists and researchers) or by choice (for example, general practitioners who do not want the hassle of prescribing opioids and other controlled substances).

To obtain a DEA number, a physician must apply to the DEA and pay an $888 fee. DEA numbers are valid for 3 years at which time the physician must re-apply. The DEA waives the fee for certain physicians including those who work in the military, for U.S. government hospitals or institutions, and for state government hospitals or institutions. As an employee of the Ohio State University (a state government institution), my DEA fees were waived. However, even if the fee is waived, the practitioner must still apply for and obtain a DEA number and the practitioner must still meet the new education requirements.

Certain practitioners are exempt from the new educational requirement including veterinarians, physicians board-certified in addiction medicine, and practitioners who have graduated from their professional school within the past 5 years. The latter means that most residents in training are exempt.

What are the specifics of the requirement?

When applying for a new or renewal DEA number, physicians (and other practitioners) must check a box attesting to having completed 8 hours of training on treatment and management of patients with opioid or other substance use disorders. This is a fairly broad topic area and it is up to physicians to maintain their own documentation of completion of education in the event of an audit. In addition, if the physician faces legal action (such as a medical malpractice lawsuit), documentation of completion may be necessary to establish physician competency. The details of the requirement are as follows:

• The 8 hours of education do not need to occur in one session and (for example) can be 8 individual 1-hour CME events.
• This is a one-time requirement and will not need to be repeated every three years when re-applying for a DEA number.
• Education can take the form of grand rounds, classroom sessions, on-line materials, or professional society meetings.
• Education hours obtained prior to the new requirement also count. For example, attending a grand rounds on buprenorphine in past years can count; just be sure that you have documentation of participation or attendance. Physicians with an X-Waiver can count the training hours from their original X-Waiver application.
• The education can come from any organization accredited to provide CME credits by the Accreditation Council for Continuing Medical Education.

What do hospitals need to do?

Although the DEA requirement is left to the responsibility of the individual practitioner applying for a DEA number, hospitals do have an obligation to facilitate education. First, if practitioners fail to get the required 8 hours of training and are unable to obtain a DEA number, the hospital’s ability to dispense controlled substances or manage patients requiring controlled substances will be compromised. Second, in the event of a medical malpractice lawsuit involving a practitioner on the medical staff who lacks documentation of completion of the educational requirements, the hospital could be accused of being complicit by not confirming that their practitioners were appropriately trained. Specific steps that hospitals should take now include:

• Make sure that all members of the medical staff are aware of the new DEA requirements.
• Inventory practitioners’ DEA license expiration dates and remind practitioners at least 6 months in advance of that date that they must fulfill the educational requirements prior to the renewing their DEA number.
• Require practitioners with DEA numbers to submit documentation of completion of the educational requirements and then maintain that documentation in each practitioner’s employment record.
• Require any new practitioners to include documentation of completion of substance abuse treatment CME as part of their application to the medical staff. Those lacking documentation should be required to complete training during their provisional/probational appointment period.
• Schedule grand rounds or other CME events covering treating and managing patients with opioid or other substance use disorders.
• Provide practitioners with links to on-line CME resources. For nearly a quarter of a century, I moderated the CME webcast, OSU MedNet-21. We produced many CME webcasts on substance abuse disorders and these webcasts are available to anyone. A recent example is:
  • Addiction, Stigmata, & First-Person Language
• Many professional societies have included sessions on substance abuse disorders as part of their annual meetings or have prepared on-line CME sessions to help fulfill the requirements. Examples of on-line education programs include:
  • The American College of Physicians
  • The American Society of Addiction Medicine
  • The American Medical Association
  • The American Society of Anesthesiologists
  • The American Academy of Pediatrics
• The Centers for Disease Control offers a free on-line 1-hour CME activity about substance abuse disorders
• Journal subscription materials can count. Practitioners with subscriptions to resources such as UpToDate, JAMA, and the New England Journal of Medicine can obtain CME credit by reading relevant articles and then applying for CME hours.

Why has Congress required this?

The primary impetus for the new requirement is a directive of the U.S. Congress to address the opioid epidemic. Eliminating the X-Waiver program was seen as a way of improving access to treatment for patients with opioid use disorder. But to justify elimination of the X-Waivers, Congress needed a mechanism to ensure that all practitioners were knowledgable in initiating treatment for opioid use disorder.

In 2021, a total of 106,699 Americans died of a drug overdose. Although street-purchased fentanyl was the most common drug implicated, prescription opioids accounted for 16,706 of the overdose deaths in 2021. In fact, the number of deaths from prescription opioids exceeded the number of deaths from heroin (9,173).

Drug overdose deaths are particularly high in Appalachian states. West Virginia has the highest overdose death rate at 90.9 per 100,000 population, followed by Kentucky and Tennessee (each 56.6 per 100,000 population) and Louisiana (55.9 per 100,000 population). My state of Ohio ranks 7th highest at 48.1 per 100,000 population. Nebraska comes in lowest at 11.4 per 100,000 population.

To put these numbers in perspective, last year, the U.S. COVID death rate was 61.3 per 100,000 population. Opioids are abused by more than 10 million Americans each year (3.8% of Americans) and 2.7 million Americans have an opioid use disorder. About half of those who become addicted to opioids first use opioids in the form of prescription pain medications. An estimated 3% – 19% of people who take prescription opioid pain medications will become addicted to opioids. Addiction can occur with only 3-5 days of prescription opioid use.

The good news is that there are effective treatments for opioid use disorder including buprenorphine (often combined with naloxone), methadone, and naltrexone. In addition, the FDA has now approved naloxone to be sold over-the-counter to treat opioid overdose. The goal of the DEA education requirements is that any practitioner in the U.S. who is licensed to prescribe opioids is also trained in identifying and treating opioid abuse.

A quarter of a century of change

In the 25 years since the American Pain Society advocated that physicians adopt “pain as the 5th vital sign” and since Purdue Pharmaceuticals falsely promoted OxyContin as a non-addictive opioid, physicians have become much more aware of the role that we have played in catalyzing the current opioid epidemic. The new DEA education requirements were created as one step in remedying the epidemic. By helping our physicians meet these new requirements, hospitals can help reduce the number of Americans who become addicted and help increase the number of Americans who get their addiction treated.

August 28, 2023

A recent study in JAMA Internal Medicine showed that the number of hours physicians work per week has fallen significantly over the past 20 years. The data was derived from the U.S. Census Bureau’s Current Population Survey that included 87,297 monthly surveys of physicians between 2001 and 2021. During this 20-year period, the average number of hours worked per week has steadily fallen.

In the study, respondents were asked how many total hours they worked at all jobs during the previous week. The average weekly work hours from 2001 – 2003 were compared to average weekly work hours from 2019 – 2021. Overall, the average physician worked 52.6 hours per week in 2001 – 2003 and this number dropped to 48.6 hours per week in 2019 – 2021. When only physicians working full-time were included, the work hours decreased from 55.6 hours per week in 2001 – 2003 to 51.1 hours per week in 2019 – 2021.

There has been a change in work hours by physician age. In the time period 2001 – 2003, the youngest physicians (age 35 – 44) worked the most hours per week, followed by middle aged physicians (age 45 – 54), and then older physicians (age 55 – 64). In the more recent time period of 2019 – 2021, the opposite was true – older physicians (age 55 – 64) worked the more hours per week than younger physicians.

On average, male physicians currently work more hours per week (49.7 hours) than female physicians (46.8 hours). However, this gap has been narrowing with a gender difference of 5.3 hours per week in 2001 – 2003 versus a gender difference of 2.9 hours per week in 2019 – 2021. Differences in the percentage of women in different specialties may be responsible for some of the gender difference in hours worked per week. Other physician demographic variables did not differ significantly in the current number of hours worked per week including race, country of origin, urban vs. rural, and dual household earners versus single household earners.

The 2023 Medscape Physician Compensation Report surveyed 10,011 physicians between October 7, 2022 and January 17, 2023. The report found that there is substantial variation in physician work hours among different specialties. Hospital-based specialties that tend to involve patient care at night and on weekends work the most hours per week including critical care, general surgery, cardiology, and nephrology. On the other hand, outpatient specialties that generally do not require seeing patients at night or on weekends had the lowest work hours per week including allergy, dermatology, and ophthalmology. Emergency medicine also had a low number of hours worked per week, owing to the shift work nature of the specialty.

A problem with the Medscape survey is that all of the information is self-reported and thus susceptible to either over-estimation or under-estimation. Furthermore, the survey is voluntary and the physicians who choose to report data may not be truly representative of the population of physicians as a whole. Nevertheless, the recent Medscape data for work hours by specialty are remarkably similar to a 2011 study published in the Archives of Internal Medicine.

At the onset of the COVID-19 pandemic (during the 2nd quarter of 2020), the average number of hours physicians worked per week fell as elective procedures were canceled. However, weekly work hours quickly rebounded by the 3rd quarter of 2020 as shown in the graph below derived from data from the recent study in JAMA Internal Medicine. Notably, over the the 24 quarters from 2016 through 2021, the overall trend has been for physician work weeks to become shorter.

Do work week hours correlate with income?

Intuitively, one might assume that specialties with longer work weeks also have higher incomes. However, the 2023 Medscape Physician Compensation Survey indicates that there is little relationship between the number of hours worked per week and the annual compensation by specialty. The graph below shows average number of hours worked per week in red and annual compensation in blue for 29 specialties.

By combining the data from the two graphs above, we can calculate the average income per work-week hour. Note that this is not same as hourly compensation – that would require dividing the income per work-week hour by the number of weeks worked per year. The Medscape Physician Compensation Survey did not report the number of work vs. vacation weeks per year by specialty so true hourly compensation cannot be determined. The graph below shows that plastic surgeons, orthopedic surgeons, dermatologists, and radiologists have the highest income per work-week hour. Infectious disease specialists, family practitioners, pediatricians, and general internists have the lowest compensation per work-week hour. Notably, family medicine, pediatrics, and general internal medicine have shorter residencies (3 years) than the other specialties.

As stated in a previous post, the data for infectious disease is particularly alarming. Physicians specializing in infectious disease have the lowest income per work week hour of all 29 specialties in the Medscape Physician Compensation Survey. In order to become board-certified in infectious disease, a physician must first complete a 3-year internal medicine residency and then complete a 2-year infectious disease fellowship. However, infectious disease specialists have both a lower total annual income and a lower income per work week hour than general internists. The implication is that an infectious disease specialist is financially penalized for doing a 2-year fellowship after internal medicine residency. As a result, many infectious disease specialists are either supplementing their income by working part-time as hospitalists or are leaving the specialty of infectious disease altogether to work as general internists or hospitalists. Because of the nature of physician billing and RVU determination, it is not possible for infectious disease specialists to increase their income by professional billing alone. There is an urgent need for U.S. hospitals to financially supplement their infectious disease specialists in order to preserve the infectious disease physician workforce.

Physicians are working fewer hours but are they happier?

The Medscape Physician Compensation Report found that 73% of physicians would choose medicine again if they were just now starting their career. However, the Medscape survey five years ago found that 77% of physicians would choose medicine again, indicating that physicians are less satisfied with their careers now than five years ago.

Undoubtably, the COVID pandemic has had an impact on physician job satisfaction. During the pandemic, many physicians retired early or left the workforce for other jobs. In 2019, there were 989,684 clinically active physicians practicing in the United States. In 2021 that number fell to 923,419, a 6.7% decrease. Hopefully, as the pandemic winds down and the practice of medicine gets back to normal, the exodus of physicians from the profession will slow.

The continued creep in paperwork and administrative tasks is a dissatisfying factor for many doctors – physicians reported spending an average of 15.5 hours per week on these chores, of which 9 hours are for electronic medical record documentation. Advances in artificial intelligence technology offers hope that the use of electronic medical records will be streamlined in the near future, giving physicians more time to engage in direct patient care. Over the past decade, there have been increasing concerns raised about the extent of physician burnout. Long work hours have been suggested to be a cause of physician burnout but the data suggests that physicians are less satisfied despite working fewer hours than in the past.

What about nurse practitioners and physician assistants?

The large number of retiring physicians coupled with reduced physician work week hours indicates that the overall supply of physician services is declining. Over the past decade, this has been offset by an increase in nurse practitioners. It is far less expensive to train a physician assistant or nurse practitioner (6 years education post-high school) compared to a physician (11 to 16 years education post-high school, depending on specialty). Many services traditionally performed by physicians can be equally or near-equally performed by PAs and NPs. However, specialized medical care and complex procedures still require the additional training and experience of physician specialists and so there is a limit to the degree that PAs and NPs can substitute for physicians.

Are the numbers good or bad?

The reduction in physician work hours is both good and bad. It indicates an improvement in a profession that has historically been seen as arduously time-consuming. But it also implies reduced availability of physician services to the general population. In the future, reduction in administrative and paperwork time coupled with strategic utilization of NPs and PAs could allow physicians to enjoy a good lifestyle while still ensuring that Americans have access to the best possible healthcare.

May 2, 2023

Supplemental oxygen is one of the most commonly prescribed treatments in the hospital. Patients with acute or chronic lung disease depend on supplemental oxygen to stay alive. As a natural and necessary substance, oxygen would seem like a safe thing to prescribe for patients that need it. But sometimes too much of a necessary thing can be harmful. So, when is too much oxygen bad for patients? We can take a lesson from vitamins.

The supplemental vitamin industry is based on the tenet that if our bodies need a small amount of a vitamin to live, then it must follow that by supplementing larger and larger amounts of that vitamin, our bodies will function better and better. Americans love this concept and we spend $30 billion every year on supplements. But frequently, too much of a good thing turns out to be a bad thing. Take Vitamin A – it is necessary for normal health and without vitamin A, we can lose night vision and become immunocompromised. A small amount of vitamin A in our diet keeps our bodies functioning normally. But if a person ingests too much vitamin A from supplements or from a dietary source that is high in it (such as polar bear liver), death can result from vitamin A toxicity. The same is true for water: drinking too little and a person dies of dehydration but drink too much and a person dies of hyponatremia. For decades, we thought oxygen was somehow different and that it was always better to err on the side of prescribing too much oxygen than risk prescribing too little. It turns out that we were wrong.

There are a lot of different oxygen delivery options: home concentrators, portable concentrators, compressed oxygen gas tanks, liquid oxygen, etc. In the hospital, oxygen is usually delivered through a medical gas panel that will have outlets for medical grade oxygen, regular air, and wall suction. The oxygen that comes out of these outlets is generally at a maximum pressure of 55 PSI. Conventional oxygen delivery devices (nasal cannulas and simple face masks) in the hospital usually are capped at a maximum flow rate of 15 liters per minute. Heated high flow nasal cannulas can deliver very high oxygen flow rates of up to 60 liters per minute. Mechanical ventilators can blend pure oxygen with room air to achieve anywhere from 21% to 100% inhaled oxygen concentrations (FiO2). As a result, physicians can adjust the amount of supplemental oxygen that a patient receives from a very small amount to a very large amount.

In the past, when EMS personnel would bring a patient with shortness of breath to the emergency department, they would put a mask on that patient and turn the oxygen up to a 15-liter flow rate to achieve close to 100% inhaled oxygen. In the hospitals, doctors would prescribe a high flow of oxygen and then not decrease that flow rate until a patient’s condition was improving and it was time to wean the oxygen down. In our emergency departments, ICUs, operating rooms, and hospital wards, we would give the patient as much oxygen as it took to raise their blood oxygen saturation to 100% and leave the oxygen at that flow rate for hours or days. But it turns out that we were probably harming patients by doing so.

In the past several years, there have been studies showing that prescribing excessively high oxygen flow rates can worsen patient outcomes in adults with lung disease. A study published in this week’s JAMA extended those findings to children. This study looked at 1,567 children, ages 1 – 4 years old, at 14 hospitals in Australia and New Zealand who had respiratory failure. The children were randomly assigned to receive either standard oxygen therapy or high-flow oxygen therapy. The high-flow group received as high as 40 liters per minute, depending on body weight. The standard-flow group received up to 2 liters per minute that was titrated to keep the blood oxygen saturation above 92%. The children receiving high-flow oxygen had a significantly longer length of hospital stay (1.77 vs. 1.50 days), longer duration of time on oxygen (1.07 vs 0.75 days), and higher rate of admission to the ICU (12.5% vs 6.9%).

Other studies have shown that excessive supplemental oxygen can be harmful in adults. A study of 429 patients given supplemental oxygen after resuscitation for cardiac arrest found that 40.7% of those receiving a conservative oxygen flow rate died but 50% of those receiving a liberal (i.e., higher) oxygen flow rate died. A meta-analysis study of 16,037 critically ill patients treated with conservative vs. liberal oxygen therapy found that those treated with liberal oxygen therapy (higher flow rates) had a higher mortality than those treated with conservative oxygen therapy (lower flow rates). A 2022 study of inpatients receiving supplemental oxygen during COPD exacerbations found that those who had arterial oxygen saturations of 88 – 92% had the lowest mortality rate and those patients given greater amounts of supplemental oxygen to maintain arterial oxygen saturation > 92% had significantly higher mortality rates.

For patients having out-of-hospital cardiac arrest, the conservative oxygen approach may be risky, however, A 2022 study from Australia found that cardiac arrest patients treated by EMS personnel with a conservative oxygen strategy (targeting a blood oxygen saturation of 90 – 94%) had a higher mortality rate than those patients treated with a liberal oxygen strategy (targeting a blood oxygen saturation of 98 – 100%). Because there was a tendency to frequently undershoot the oxygen saturation in conservative oxygen therapy group, it is possible that even brief periods of low oxygen saturations can be harmful in patients immediately after a cardiac arrest which may have resulted in the higher mortality rate.

Adverse effects of too much oxygen

So, if oxygen is so necessary for us, how can it harm us? There are several effects of excessive oxygen that can result in harm:

• Oxygen toxicity. High oxygen concentrations can damage lung cells by oxidant injury resulting from the production of substances such as superoxide anion, hydroxyl radical, and hydrogen peroxide. We sometimes see this in the intensive care unit in respiratory failure patients who require 100% oxygen concentrations for long periods of time who get into a vicious cycle of pneumonia requiring supplemental oxygen and then the high oxygen concentrations cause further lung damage resulting in the patients needing even higher oxygen concentrations in order to get enough oxygen into the blood stream to keep the body’s organs alive. These patients can end up with permanent lung scarring and never get off of the mechanical ventilator. Lung damage depends on how long a person is exposed to high concentrations of oxygen – brief periods are less harmful than breathing very high concentrations of oxygen for longer periods of time. This mainly applies to those patients in the ICU left on 60% – 100% inhaled oxygen for several days.
• Drug-induced lung disease. Many drugs can cause damage to the lung resulting in inflammation and scar in the lungs (interstitial lung disease). Certain drugs are particularly likely to do this when combined with high concentrations of inhaled oxygen. The two biggest offenders are bleomycin (used in cancer chemotherapy) and amiodarone (used in heart rhythm disorders). When a patient is breathing room air, these drugs are usually safe but when breathing high concentrations of oxygen, these drugs can become very toxic. Bleomycin is particularly notable because the risk of pulmonary toxicity from breathing high oxygen concentrations can persist for many years after the patient was given bleomycin.
• Radiation-induced lung disease. Excessively high amounts of radiation to the chest can cause interstitial lung disease but moderate amounts can be used safely to treat lung cancer. However, when a patient is using high oxygen concentrations, those moderate amounts of radiation can cause interstitial lung disease. Thus, like amiodarone and bleomycin, oxygen therapy can increase the risk of radiation-induced pulmonary fibrosis.
• Adsorptive atelectasis. Room air contains about 21% oxygen and 78% nitrogen. Oxygen readily passes from the alveoli of the lungs (air sacks) into the blood stream but nitrogen does not cross as easily. Because of this, nitrogen in the air helps keep the alveoli of the lungs propped open, similar to using PEEP (positive end-expiratory pressure) on a mechanical ventilator, thus preventing atelectasis. When a person breathes very high concentrations of oxygen, the nitrogen in the alveoli gets “washed out” and as a result, the lungs are more prone to developing atelectasis that can in turn worsen oxygenation. Once again, the patient can get into a vicious cycle of worsened blood oxygen levels leading to the doctor increasing the supplemental oxygen concentration leading to worsened atelectasis leading back to worsened blood oxygen levels.
• Carbon dioxide retention. Our breathing rate is determined by the blood oxygen level (PO2) and carbon dioxide level (PCO2). Patients with COPD are sometimes less sensitive to rising carbon dioxide levels and more dependent on the blood oxygen level to determine respiratory rates. In this setting, by giving too much supplemental oxygen, the patient can lose their respiratory drive and begin to hypoventilate, resulting in a high blood carbon dioxide level. Although this effect on PCO2 levels is usually small, it can be important when combined with other things that can suppress the respiratory drive centers, such as sedatives and opioids.
• Longer oxygen weaning times. When a patient with acute respiratory failure in the hospital begins to improve, the doctor will generally order the respiratory therapist to wean the oxygen off (or back down to the patient’s normal home supplemental oxygen flow rate). The respiratory therapist will then reduce the oxygen flow rate by 1-2 liters per minute, wait a couple of hours, recheck the blood oxygen saturation, reduce the flow rate by another 1-2 liters, etc. It takes less time to wean oxygen off if a patient is on less oxygen to begin with than if they are receiving higher flow rates of oxygen. The doctors generally wait until the oxygen is completely off (or down to the normal flow rate the patient uses at home) before the patient is allowed to be discharged. As a result, longer oxygen weaning times can sometimes lengthen the patient’s hospital stay.

So, what is the right amount of supplemental oxygen?

Our bodies require oxygen to live. If we don’t get enough oxygen, our tissues become damaged. On the other hand, too much oxygen is also bad for our bodies. Here is what we can do in our hospitals to draw the right balance between not enough and too much:

1. In emergencies, it is better to give too much than to give too little. In settings such as cardiac arrest, myocardial infarction, and stroke, brief periods of low blood oxygen levels can worsen clinical outcomes. If too much emphasis is placed on using the least amount of supplemental oxygen, there is a greater risk of undershooting the oxygen flow rate and causing low blood oxygen levels for seconds or minutes. Situations where this applies include during transport of cardiac arrest or stroke patients by emergency squads, during CPR for cardiopulmonary arrest, and during the first hours of a myocardial infarction or stroke.
2. Target a blood oxygen saturation of 88 – 92%. After the initial resuscitation, titrate the supplemental oxygen flow rate (or the FiO2 on the mechanical ventilator) to the least amount necessary to keep the oxygen saturation between 88 – 92%. For years, physicians have written orders to “Wean supplemental oxygen to maintain oxygen saturation > 92%”. This is probably too high and our default oxygen weaning orders in our electronic medical records need to be revised.
3. In the ICU, use other measures to improve oxygenation when patients need more than 60% FiO2. This could include increasing the PEEP on the ventilator, using prone ventilation, giving sedatives, controlling fever, or using neuromuscular blockade.
4. Avoid unnecessary use of 100% FiO2 during surgery. In the past, anesthesiologists would sometimes leave patients on 100% FiO2 throughout surgical operations so that there would be no risk of the patient desaturating during surgery. Not only can this increase the risk of post-operative absorptive atelectasis, but it can be particularly harmful if patients have previously received sensitizing drugs or radiation. One of my colleagues was a physician who had been treated with bleomycin years previously for lymphoma. He underwent an elective gall bladder surgery and was left on 100% FiO2 during the procedure. He developed acute lung injury post-operatively and died from bleomycin-induced acute oxygen toxicity.
5. We need pharmacologic 2,3-DPG. 2,3-Disphosphoglycerate (2,3-DPG) is a chemical in red blood cells that helps hemoglobin molecules release oxygen. Physiologically, this can result in a  shift in the oxy-hemoglobin dissociation curve to the right. This means that oxygen can pop off of hemoglobin easier, allowing the red blood cells to release more of their oxygen to tissues that need it. In other words, 2,3-DPG allows the tissues to get by when there is less oxygen in the blood. Normally, red blood cells release about 30% of their oxygen when they pass through tissues; 2,3-DPG allows them to release more than 30%. What is important to our bodies is not the amount of oxygen in the blood but rather the amount of oxygen that our tissues get. 2,3-DPG allows our tissues to function normally when the blood oxygen saturation is lower. If we could increase red blood cell 2,3-DPG levels pharmacologically, we could use lower amounts of supplemental oxygen in patients with acute respiratory failure.
6. Not everyone with a low oxygen saturation needs supplemental oxygen. Insurance will not pay for supplemental oxygen unless a patient has an oxygen saturation of < 89%, either at rest, during exercise, or during sleep. But that does not mean that every patient with brief oxygen saturations < 89% needs supplemental oxygen. The LOTT study showed that COPD patients with oxygen saturations 89 – 92% at rest that desaturated to 80 – 90% with exercise had no benefit from supplemental oxygen, including death rates, hospitalization rates, COPD exacerbations, and quality of life. In my own clinical practice, I have also been hesitant to prescribe oxygen in hyperemic patients who are at fire risk, including those who smoke, have smokers in the home, or use gas cooking stoves. These patients are often more likely to be injured or die from fire caused by supplemental oxygen than they are to die from hypoxemia without supplemental oxygen.

It’s time for auto-titrating oxygen delivery devices

Auto-titrating oxygen devices adjust the oxygen flow rate based on a patient’s oxygen saturation. A 2019 meta-analysis showed that compared to manual oxygen titration, these devices shortened hospital length of stay by shortening oxygen weaning times. A 2020 study of outpatients found that by using auto-titrating oxygen devices, patients had improved 6-minute walk distances and improved dyspnea. It is not surprising that these devices are effective in the hospital – a respiratory therapist cannot be in a patient’s hospital room 24 hours a day to constantly adjust the supplement oxygen flow rate but the auto-titrating oxygen delivery device can. Not only can these devices reduce excessive supplemental oxygen flow rates in hospitalized patients, but they can also reduce excessive oxygen flow rates in outpatients.

The cost to hospitals to buy and implement auto-titrating oxygen delivery devices would be considerable. However, these costs could potentially be off-set by shortened hospital length of stays and by reduction in utilization of respiratory therapists. These devices would also take some of the guesswork out of ordering oxygen flow rates for hospitalized patients resulting in a more standardized and consistent use of supplemental oxygen by hospitalists and intensivists. In addition, there is a potential for a reduction in hospital mortality rates by avoiding excessively high amounts of supplemental oxygen.

There is both an art of medicine and a science of medicine. It is time to harness science to guide the use of supplemental oxygen.

January 26, 2023

“Observation status” was originally conceived of as a way to watch patients presenting to the emergency department for a few hours in order to determine whether or not they needed to be admitted to the hospital. The purpose was to reduce unnecessary inpatient hospitalizations and thus reduce overall healthcare costs. But there has been a creep in the use of observation status as well as the healthcare bureaucracy to administrate it. The result is that observation status has now increased overall healthcare costs. It is time to consider eliminating observation status in the United States.

How did we get here?

Prior to 1960, emergency departments were staffed by residents and general practitioners. The doctor who saw you in the ER was generally the same doctor who took care of you in the hospital. Emergency medicine became a specialty in 1968 with the creation of the American College of Emergency Medicine. The first emergency medicine resident began training in 1970 and the first board examination in emergency medicine was offered in 1980. The result was that the doctor that took care of a patient in the ER was no longer the same doctor who took care of them once they were admitted to the hospital. In 1983, DRGs were first used to determine the amount of money that Medicare would pay hospitals for inpatient admissions for any given diagnosis. After the introduction of DRGs, it became immediately clear that there needed to be some way of determining which patients were sick enough to warrant admission to the hospital from the emergency room, otherwise, the hospitals would be incentivized to admit as many people as possible, even if they were not very sick.

Initially, that determination was left to the emergency room physician. But that ER doctor needed to find an inpatient physician who would agree to admit the patient. During my residency, we had a designated “medical admitting resident” each day who would make the decision about which patients were sick enough to require admission. Some residents got the reputation of being “sieves”, meaning that they would admit everyone that the ER physician called them about whereas other residents got the reputation of being “walls”, meaning that they would block admissions from the ER unless the patients were at death’s door. You always wanted to be on-call at night with a resident who was a “wall” because that meant you would have to do fewer history and physical exams, your inpatient service census would be lower, and you might actually get a few hours of sleep that night.

In order to provide some rules for which patients warranted inpatient admission, Medicare directed that patients who could be sent home within 24 hours should be observed in the ER rather than admitted to the hospital. However, keeping a lot of patients in ER beds for 24 hours was impractical so hospitals started putting those observation patients in regular hospital beds to avoid congestion in the emergency department. The unintended consequence was that this simply led to keeping patients in the hospital for longer than 24 hours, just so they could be classified as inpatients. This was especially a problem with outpatient procedures when many hospitals kept patients overnight for procedural recovery and then billed Medicare for both the outpatient procedure plus an inpatient hospital admission. Medicare countered in 2002 by agreeing to pay hospitals specifically for observation stays in order to provide an alternative to inpatient admission for those patients who were only mildly ill or who needed extra time to recover from an outpatient procedure. Initially, the only diagnoses that could be billed as observation stays were heart failure, chest pain, and asthma. In 2008, Medicare began paying for observation stays for all diagnoses.

In parallel with the development of reimbursement policies for observation stays, Medicare began policing hospital admissions by using the RAC (recovery audit contractors). RAC auditors would review the charts of patients who had been admitted to the hospital and if the auditor determined that there was not sufficient documentation in the chart to justify inpatient admission, Medicare would collect penalties from the hospital for overpayment. By 2014, the RAC program had collected $2.3 billion from hospital overpayments. One of the most common reasons by RAC auditors when denying an inpatient admission was that “…the patient could have safely and effectively been treated as an outpatient.” The auditors were often incentivized to deny admissions since more denials often led to bigger bonuses for the auditors. As a result, the denials were frequently capricious and arbitrary. 25 years ago, a coder for a commercial insurance company confided in me that her supervisors told her to randomly deny every 10th hospital admission because hospitals usually found that it was too expensive to contest denials. Fear of RAC audits resulted in physicians and hospitals increasing the use of observation status in order to avoid the risk of being penalized for an unnecessary inpatient admission.

A second strategy employed by Medicare was to create a list of surgical procedures that were classified as “Medicare Inpatient-Only Procedures”, meaning that those operations required an inpatient admission. Any surgical procedure not on the list was to be classified as an outpatient procedure unless there were extenuating circumstances that uniquely required a patient to be admitted to the hospital. Medicare pays much more if a surgery is performed as an inpatient (Medicare Part A) than if it is performed as an outpatient (Medicare Part B). Over time, the Medicare Inpatient-Only list shrank as more and more surgical procedures were reclassified as being appropriately done as outpatient and not requiring of hospital admission. Thus, knee and hip replacement surgeries were initially considered to require inpatient admission  but are now considered to be outpatient procedures.

Medicare also changed its definition of observation stays to be any condition that requires the patient to be in the hospital for “less than 2 midnights”. Although it could be argued that this gave hospitals longer than 24 hours to treat an observation status patient and send them home, the 2-midnight definition was somewhat arbitrary. For example, a patient presenting to the emergency department at 11:00 PM would spend 25 hours in the hospital before crossing 2 midnights but a patient presenting at 1:00 AM would spend 47 hours in the hospital before meeting the 2-midnight definition. However it is not how many midnights a patient actually spent in the hospital that Medicare auditors used when deciding whether to deny a hospital admission. Instead, it is whether the auditor believed that had the patient been managed appropriately, that patient could have been sent home before 2 midnights have elapsed. For example, if a patient came to the emergency department on Saturday evening with chest pain but the hospital could not do a cardiac stress test until Monday morning (2 midnights later), the auditor would still deny an inpatient admission since if the hospital offered 7-day a week stress tests, they could have sent the patient home on Sunday (after 1 midnight).

The observation vs. inpatient status bureaucracy

 

In order to avoid losing money from admission denials, hospitals started to go to great lengths to insure that the medical record contained sufficient documentation to justify every hospital admission. This was greatly facilitated by the development of electronic medical records that permitted realtime review of each patient’s hospital stay to ensure that the patient’s chart had appropriate documentation to meet Medicare’s requirements to bill that hospital stay as an inpatient admission. Some of the measures that hospitals now take in order to oversee their hospital admission practices include:

1. Physician training. When a patient is admitted to the hospital from the emergency room, the admitting physician has to enter an order directing that the patient is an “inpatient” or “observation” admission. This means that the physician has to estimate how long the patient will need to be in the hospital at the very beginning of the hospital stay and that estimated length of time dictates whether a patient will be inpatient or observation status. We now train residents in how to correctly estimate length of stay. For example, patients admitted for chest pain, syncope, and dehydration are generally observation status unless there are extenuating circumstances.
2. Nurse admission reviwers. Hospitals will generally hire a group of nurses or other healthcare workers to review every patient’s chart on a daily basis to determine if the medical record documentation justifies inpatient admission. These nurses get special training in the Medicare inpatient admission requirements. If the patient’s chart does not contain the proper documentation, the nurse’s first step is usually to contact the physician since frequently, all that is needed is an extra sentence or two in the medical record describing how sick the patient actually is. If that does not resolve the issue, the next step is to contact a physician admission advisor.
3. Physician admission advisors. Many times, the admitting physician is uncertain whether or not a patient’s illness justifies an inpatient admission order. Or the nurse reviewer’s determination is different from the physician’s admitting order for observation vs. inpatient status. For this reason, hospitals employ physicians whose main job is to arbitrate inpatient and observation orders. Often, this will be a private physician review company where the physician reviewers can access patient charts on a daily basis. Larger hospitals usually do this internally by hiring some of its own emergency medicine physicians or hospitalists to dedicate a certain number of hours per day reviewing admissions.
4. Hospital medical directors. When another layer of physician review of how to classify a patient’s admission is required, it then goes to the hospital medical director. Even for a small hospital, this is usually several charts to review every week. It takes about 15-20 minutes to do one of these reviews and then contact the admitting physicians to try to talk them into changing an admission order from inpatient to observation or vice-versa. Frequently, it requires the medical director to either enter an administrative note in the electronic medical record or to send the hospital utilization review office a letter so that the hospital has a documentation  paper trail in the event of a Medicare denial. More often, the medical director is sent charts for patients who had an inpatient admission order but were discharged before 2 midnights had elapsed. This is a red flag for Medicare auditors. We then have to provide written documentation for why the patient should be billed as an inpatient. Sometimes, this is easy, for example, when a patient dies from their condition in the hospital before 2 midnights elapse. But more frequently, it is because the admitting physician legitimately believed that the patient would need to be in the hospital for at least 2 midnights when that patient first arrived at the hospital. Several years ago, I attended a Medicare seminar and one of the medical administrators from Medicare told us that when this happens, we should use the phrase “The patient had an unexpectedly rapid recovery and was able to be discharged after less than 2 midnights”. Pretty much every time a patient in inpatient status was discharged before 2 midnights, one of our hospital medical directors would review that chart and send the billing office a letter using that phrase.
5. Pre-admission testing consultation. Patients who are planned to undergo a surgical procedure will frequently be sent for pre-operative medical consultation by an internist, family physician, or specially trained advance practice provider. Although designed to identify medical co-morbidities that could increase the risk of complications during surgery, these consultations are increasingly being used to determine whether or not a given patient’s surgery should be classified as an inpatient or an outpatient surgery. And most importantly, these consultations ensure that there is sufficient documentation in the electronic medical record to justify an inpatient procedure. For example, most knee replacement surgeries are now considered outpatient procedures. But if the chart documents that the patient has sleep apnea requiring CPAP, brittle diabetes, COPD requiring supplemental oxygen, and a history of vomiting after anesthesia, then that patient’s knee replacement can be done as an inpatient and the hospital gets paid considerably more. Surgeons are trained to be experts in surgery but are not trained in the nuances of co-morbid medical illnesses that they do not normally manage. Consequently, the surgeon’s outpatient notes often do not contain documentation of the significance of those medical co-morbidities and whether they are severe enough to warrant an inpatient admission for the surgery. That is why the pre-op medical consultation is so highly valued. If the surgeon admits the patient as an inpatient to do the surgery and then discharges that patient before 2 midnights pass, the chart once again gets sent to the medical director so that a letter containing the phrase “The patient had an unexpectedly rapid recovery and was able to be discharged after less than 2 midnights” is sent to the utilization review and billing offices for a documentation paper trail in the event of an admission denial by Medicare.
6. Utilization review staff. Every hospital employs a large number of personnel devoted solely to coding, billing, and utilization review. Before a bill goes out to Medicare or a commercial insurance company, these staff will do a final review to ensure that all of the proper documentation justifying an inpatient admission is present in the chart, including physician admission advisor notes and hospital medical director correspondence.There will also usually be personnel whose only job is to work denials when Medicare or an insurance company denies an inpatient admission. These personnel will then prepare and submit documentation contesting that denial in hopes of overturning the denial and getting paid for the hospital stay.
7. Attorneys and peer reviewers. When Medicare or an insurance company refuses to overturn an admission denial after the billing staff contest the denial, the next step is to turn to the legal system. This usually starts by paying an independent physician reviewer to opine whether the patient’s hospital stay should be classified as inpatient or observation. Next, hospital attorneys get involved by contacting Medicare attorneys about the denial. Sometimes, contested denials require adjudication, requiring more attorney time.
8. Medicare staff. On the other side of the bill, Medicare and commercial insurance companies employ large numbers of staff to review charts to decide whether they think that hospitalizations should be inpatient or outpatient.

So, for any given patient’s hospitalization, there is an army of Medicare nurse reviewers, physician reviewers, utilization review staff, and attorneys that face off against an army of the hospital’s  nurse reviewers, physician reviewers, utilization review staff, and attorneys. In the end, more money is sometimes spent battling an admission denial than is actually paid to the hospital for the admission. Hospitals are willing to occasionally spend the excessive cost to contest a denial since it sends Medicare or the insurance company a signal that the hospital will not go down easily for future admission denials. It is kind of like a basketball coach throwing a tantrum about a penalty call in order to try to dissuade the referee from calling future penalties.

The net result of all of this is that the United States has created an enormous bureaucracy devoted to preventing and contesting hospital admission denials.  So, why don’t hospitals just classify more patients as being in observation status and avoid all of the expense of justifying inpatient status? The reason is money.

The finances of inpatient vs. observation status

The genesis of observation status was to reduce Medicare costs by eliminating unnecessary hospital admissions. For any given diagnosis, hospitals get paid much less if a patient is designated to be in observation status than if that same patient is designated to be in inpatient status. Overall, the reimbursement is about 1/3 less for observation stays. In other words, Medicare can reduce overall Medicare costs by pressuring hospitals to put more patients in observation status. The same holds for commercial insurance companies.

Until several years ago, Medicare also paid doctors less if patients were in observation status. However, it became clear to Medicare that this was incentivizing doctors to preferentially use inpatient status rather than observation status. And since doctors are the ones who write the admission orders, Medicare realized that it could reduce inpatient admissions by removing the physician financial incentive to put patients in inpatient status. Because the physician professional fees are much, much less than the hospital fees, by paying physicians the same whether a patient was in observation or inpatient status, Medicare would pay a little more to the doctors but would pay a whole lot less to the hospitals.

But the biggest savings to Medicare in observation status is that it transfers much of the cost of the hospital stay from Medicare to individual patients. This is because Medicare considers observation stays as outpatient visits. Outpatient services are billed to Medicare Part B but inpatient services are billed to Medicare Part A. This is hugely important to patients because patients have much higher co-pays and deductibles for their Part B charges than their Part A charges.

• Medicare Part A covers inpatient admissions including a semi-private room, nursing care, medications, meals, and tests done during inpatient admissions. Part A also covers skilled nursing facility care, home health care, and hospice care. Medicare Part A is free to Americans over age 65 who have previously worked at least 10 years (or have a spouse who worked 10 years). There are no monthly premiums and no annual deductible. The amount that Medicare covers depends on the length of stay of the hospital admission:
  • $1,600 deductible per admission
  • Days 1-60: Part A covers in full
  • Days 61-90: patients are responsible for $400 per day co-pay, either by co-insurance or out of pocket if the patient lacks co-insurance
  • Days 91-lifetime reserve limit days: patients are responsible for $800 per day co-pay, either by co-insurance or out of pocket if the patient lacks co-insurance
  • After lifetime reserve limit days (total of 60 over the entire lifetime): Part A pays nothing and patients (or their co-insurance) are responsible for the entire costs
• Medicare Part B covers hospital outpatient charges and physician professional charges. Unlike Part A, there is a monthly premium for Part B of $165/month with higher premiums for those with higher incomes. There is an annual deductible amount of $226. Patients also have additional deductibles and co-pays that are either paid by secondary insurance or out of pocket if there is either no secondary insurance or the insurance policy has limited benefits:
  • 20% co-pay for all physician charges
  • 20% co-pay for hospital outpatient charges (hospital room, nursing care, meals)
  • 20% co-pay for x-rays and procedures
  • Part B does not cover medications so the patient (or their Part D insurance) is responsible for medication charges during observation stays

The net result of these differences is that the patient will have greater out of pocket expenses for an observation stay than for an inpatient admission. This is especially true for the 7.5% of Americans over age 65 who are enrolled in Medicare Part A only and do not enroll in Medicare Part B – these patients pay the entire cost of their observation stay out of pocket.

Another financial implication of observation vs. inpatient stays is in skilled nursing facility (SNF) coverage. Medicare Part A pays for 100% of SNF charges for up to 20 days (there is a $200/day co-pay for days 21-100). However, Medicare will only pay for SNF care if a person first has an inpatient hospital stay of at least 3 days. Medicare will not pay for SNF care after an observation stay. If a patient is in observation status (or has an inpatient stay of < 3 days) and gets transferred to a SNF, the patient is responsible for all of the SNF charges.

Why observation status is really, really dumb

CMS absolutely loves observation status. It reduces Medicare costs by paying the hospitals less for any given diagnosis and it also reduces Medicare costs by transferring much of the costs directly to the patient. This allows CMS officials to report to Congress that they are reducing federal spending on healthcare. Congressional representatives can then report to voters that they are reducing government spending. But there is no such thing as free healthcare… the cost of healthcare does not go away, it just gets transferred to the patient. The individual American ends up with more out of pocket costs for co-pays, medication charges, and SNF costs that would have otherwise been covered by Medicare Part A had their hospital stay been inpatient status as opposed to observation status. So, in the long run, the average American does not save any money by being in observation status.

Nationwide, 16% of all hospital stays are observation stays and 84% are inpatient stays. But this percentage can vary widely from hospital to hospital. A tertiary care referral hospital will usually have a lower percentage of observation stays since its patients tend to be sicker with more complex medical problems. On the other hand, a community hospital, especially one that cares for underserved patients, will have a higher percentage of observation stays, typically 25% or more. About the best a hospital can hope for is to break even on observation patients – most hospitals actually lose money on observation stays.

It’s bad enough that observation status does not really save money by transferring the cost of care to the individual patient rather than Medicare. The worst part about observation status is that it actually increases U.S. healthcare expenses. Not only do hospitals have to spend an enormous amount of money justifying inpatient admissions and working inpatient denials, but Medicare spends an enormous amount of money paying staff who police admissions in order to deny inpatient admission charges.

The net result is that observation status represents the epitome of U.S. healthcare dysfunction. It has led to an enormous bureaucracy devoted entirely to deciding whether Medicare or individual patients should pay for hospital care. And that bureaucracy is enormously expensive.

How can we fix this?

Americans pay way more for healthcare than people in any other country. In 2021, the average per capita healthcare cost in the U.S. was $12,914. It will undoubtedly be much higher in 2023. One of the contributors to this is too much of the healthcare costs go into trying to decide whether Medicare or the individual American will be responsible for paying for healthcare. Getting rid of the observation status designation can reduce U.S. per capita healthcare costs. Here is how to do it:

1. Create low-acuity DRGs. For conditions that are currently commonly managed by observation status (chest pain, syncope, dehydration, etc.), CMS can create inpatient DRGs that pay the hospital less, thus simulating the amount that CMS would have paid for an observation stay.
2. Require a modest Part A co-pay for hospitalization. The biggest argument against eliminating observation status is that Medicare costs would go up since co-pay costs currently paid by patients would go back to Medicare. The solution to this would be to require a small co-pay for hospitalization days 1-60. The amount to keep Medicare’s annual budget neutral could be as little as $10 or $20 per day.
3. Outpatient should mean outpatient. How in the world we ever got to the point that we define outpatient care as needing to be in the hospital for more than 2 midnights is baffling. Either a patient needs to be in the hospital or they don’t. I once had a admission denial for a patient in respiratory failure admitted from the ER to our ICU on a mechanical ventilator. The Medicare reviewer said that in his opinion, I should have been able to correct the respiratory failure, extubate the patient, and discharge her before 2 midnights passed. Really?
4. Eliminate the SNF 3-day rule. The whole idea behind the 3-day rule was that Medicare wanted to see if a patient really needed SNF care before it would pay for it. But the unintended consequence is that if one of our patients needs to go to a SNF, we have to figure out a way to admit them to the hospital for at least 3 days first. This means that we have to wait until they fall at home and break their hip or wait until they get septic from an infected decubitus ulcer if they are unable to get out of bed. For patients undergoing surgery, such as a knee replacement, we have to keep them in the hospital for 3 days after their surgery before they can go to a SNF for rehabilitation, even if they live alone and cannot walk after their operation.
5. Eliminate the observation industry. By eliminating observation status, hospitals would no longer have to spend money on nurse admission reviewers, physician admission advisors, and medical directors who laboriously review charts for inpatient justification. Hospitals could reduce their utilization management staff and Medicare could reduce its admission reviewer staff. Hospitals, patients, and Medicare would have less need for attorneys to contest admission denials. Yes, a lot of people would lose their jobs but the overall U.S. healthcare costs would drop.

Elimination of the observation status designation would make everyone happy. Patients would not be surprised by unexpectedly high hospital bills. Doctors would not have to spend time entering unnecessary documentation in their hospital notes to justify why a patient warrants an inpatient admission. Hospitals would not have to pay as much for staff to oversee admission determination. A fundamental concept of industrial engineering is that the more complex a process is, the more energy it takes to keep that process working. Observation status has created a terribly complex process. It is time to simplify the U.S. admission process.

January 22, 2023