Trauma System Funding in Today’s Health Care Environment

Abstract

Trauma systems provide effective care of the injured patient but require major financial costs in readiness and availability of the extensive trauma team and specialized equipment. Traditional billing and collection practices do not fully recoup these costs. Effective use of the standard billing system is vital to the stability of a trauma system; however, a system wide funding mechanism provides an optimal, stable foundation. Efforts to provide sustainable trauma system funding are ongoing. Numerous state initiatives have been successful in funding trauma systems but a universal solution has yet to be found.

Introduction

Trauma centers and trauma systems represent valuable resources for the community. Understanding the need for funding mechanisms requires an understanding of the nature and the makeup of both trauma centers and trauma systems. Too often, the public perception of the trauma system centers around either emergency medicine services (EMS) or the emergency department. While both these entities are critical components of the trauma system, they do not comprise the entire system. The Resource Document for the Optimal Care of the Injured Patient defines trauma systems and trauma care from prior to injury to full recovery.¹ Recent discussion has focused on regional trauma systems and their value to the injured patient. Hoyt and Coimbra enumerated criteria for a statewide system for trauma care.² A legislative authority should be present to allow for formal designation of the components of the system using predefined standards. The system should use population or volume criteria to designate trauma centers, and the triage criteria in place should direct patients to the trauma centers. Survey teams to verify the process should not be biased and ideally should be from other states. Perhaps obvious, but essential is complete geographic coverage.

With the development of established trauma centers and systems, investigations into the impact of these programs have been possible. O’Keefe et al published their experience with mortality in an established trauma center over a ten-year period.³ They documented improved survival in severely injured patients. In the current heath care environment, improved outcomes are in perfect alignment with enhanced quality initiatives and concepts such as pay for performance models. The data support the benefits of defined trauma systems.

The Costs of First Class Trauma Care

The challenge for maintaining effective trauma systems centers much on the financial stability and sustainability of the entire system. The bulk of the remainder of this review will focus on the trauma center. Due to the somewhat unpredictable nature of the arrival of the next injured patient, readiness represents a key requirement for a trauma center. This readiness also incurs a defined, fixed cost for the trauma center that is independent of the number of injured patients who arrive at the facility. The concept of readiness poses challenges to traditional billings and reimbursements that are based on Diagnosis Related Group (DRG) or Current Procedural Terminology (CPT) coding. For example, there is a CPT code for physician standby time of up to 30 minutes. Generally this code is used for situations such as a pathologist on standby for a specimen or neonatologists on standby for a delivery. It has a low assigned relative value units (RVUs) of 1.2, but it is not routinely reimbursed by Medicare or Medicaid.⁴ With respect to trauma the question becomes somewhat unanswerable. How should such readiness codes be implemented and to whom would the physicians send their bills? As an outcome of the difficulty to bill for ‘readiness’, many systems and centers have begun to look for some mechanism to develop sustainable funding streams for the trauma system.

Defining the actual cost of operating a designated Level 1 trauma center can be a bit challenging. Many of the fixed costs of the hospital can be attributed to the need to care for injured patients. On the other hand, much of the infrastructure that is required by certifying bodies provides improved care to patients who have not sustained a traumatic injury. The author does not possess sufficient accounting skills to quibble the finer points. The direct costs of the survey process and the personnel in the trauma service clearly underestimate the cost of an open trauma center. The direct costs of salary support of every health care professional that treats an injured patient in combination with the overhead of the hospital itself clearly overestimate the cost of a trauma center. Several authors have grappled with defining a more functional definition of the cost of a trauma center. Rotondo et al examined changes in costs at their hospital after a dedicated effort to enhance the trauma center.⁵ They calculated a subset of costs defined as direct personnel costs in the traditional and new periods. In the new period, attending surgeons were in house and were fellowship trained. The average total cost between both the hospital and the associated university was close to 4.5 million dollars per year. In another work, Taheri calculated a “cost of readiness” by including physician call stipends along with the cost of the trauma nurse manager and registrar.⁶ Their data were drawn from an aggregate of trauma centers in Florida. By the information reported for the study, the median annual cost to a hospital for participation as a trauma center was 2.7 million dollars. While there may be some regional variations, these two studies provide some idea of the degree of institutional support required to provide care to the injured patient.

Changes and Charging in Health Care Delivery

Changes in the delivery of health care have altered the manner in which physicians and hospitals interact. In the past, physicians and hospitals had a somewhat symbiotic relationship. Hospitals provided a physical location for patient care. In return, physicians would take call for the hospital to provide care for patients who presented. Numerous factors including the advent of free standing imaging centers, free standing surgicenters, and increases in both managed care and physician employment by hospitals or universities have impacted that traditional system. Consequently trauma centers have faced increasing challenges in the current health care environment. In a survey of Oregon hospitals almost 50% of hospitals were not able to provide coverage of at least one specialty mandated to be available for the care of trauma patients.⁷ Many hospitals have opted to offer stipends to encourage physician participation in the call schedule. Others have employed physicians directly. Finding sufficient coverage can be challenging even in the setting of hospital provided stipends.⁷ Other studies have looked at the impact of financial pressure on the likelihood of trauma system closure. Financial losses do jeopardize trauma centers; however, a high profit margin does not guarantee a center will stay open.⁸ These finding suggest that external support must be tailored to each system and each facility to enhance durability of the system.

In Missouri, there have been two efforts to secure trauma specific funding that were not successful. These two initiatives occurred in 2002 and 2006 and involved tax on cigarette sales.

In the current health care environment, trauma system finances are stressed. Finding solutions require coordination of several efforts. Legislation at the state or national level can provide trauma specific funding. Hospitals and physicians can use the most current documentation to capture what revenue is available from current reimbursement sources. Finally efforts at increased efficiency and throughput can help support the bottom line.

There have been numerous regional efforts to secure durable funding for trauma systems. Several themes have been successful across the country. Fees on traffic violations, license renewal, cigarette taxes, and fees from gambling have all been applied to provide funds for trauma systems. In Missouri, there have been two recent efforts to secure trauma specific funding that were not successful. These two initiatives occurred in 2002 and 2006 and involved tax on cigarette sales. Both Arkansas and Tennessee have been successful in passing legislation with a tax on cigarettes specific for trauma funding.^{9, 10} All such measures require vigilance to continue the funding process. While not specific to trauma, New Jersey had implemented a tax on cosmetic surgery procedures. Collections fell far short of predictions and ultimately the tax was repealed by the very legislator who introduced it.¹¹ Even if projections are not met, the trauma specific funding strengthens the system.

Within the resource limits of the system, maintaining maximal reimbursement helps insure longevity of each aspect of the system. From the hospital perspective, a charge code was approved by the American Hospital Association to charge for Trauma Activation. With input from the National Foundation for Trauma Care, revenue code 68x was defined as a mechanism to recoup costs incurred for readiness.¹² Despite the availability of this code since 2002, many designated trauma centers have not been submitting charges. In their survey of use of the code, Fakhry et al found large variability in both the amount of the charges and the degree of denials by payers.¹² One significant limitation of the current system is that a formal prehospital provider must bring the patient. Self-presenting patients are not eligible for use of the 68x code. Another fairly simple, but elegant adaptation involves matching staffing with the predictability of patient volume. Vaziri et al queried the National Trauma Data Bank to evaluate when injured patients arrived at the hospital. The presentation of patients varied throughout the day. There was a peak in volume between 6:00 p.m. and 8:00 p.m. with a trough between 6:00 a.m. and 8:00 a.m.¹³ Knowledge of this cycle can allow for more rational planning of staffing, non clinical duties and operating room availability. Finally, preservation of the providers and avoiding burnout stabilizes the trauma system. Studies documented that there was no change in mortality comparing in house trauma surgeons to on call trauma surgeons.¹⁴ On call trauma surgeons did, however, have a response time of 14 minutes after patient arrival. Thus all patients had an attending surgeon at the bedside in less than 15 minutes. While surgeon satisfaction may seem tangential to funding issues, decreased turnover, decreased need for training and recruitment both save costs to the system.

Physician compensation for management of injured patients has shifted as has approaches to the management of the injured patient. Many procedure based diagnostic interventions such as diagnostic peritoneal lavage have been replaced with imaging. Nonoperative management of injury has decreased the number of billable cases available. Evaluation and Management (EM) coding and its optimization have become increasingly important. Barnes et al found that in their program they were able to increase EM charges by 270% by generating a standard documentation tool and having real time assessment of the notes by professional coders.¹⁵ Davis et al displayed similar increases in total charges incorporating both procedure billing as well as EM billing (380%).¹⁶ In both Barnes’ and Davis’ institutions these charges represented an increase of nearly one million dollars. Although this amount does not completely fund the trauma center, it does help bring costs and revenue in line. Increasingly, trauma care physicians are providing general surgery coverage as well as trauma coverage. In Davis’ center trauma related RVUs represented only 25% of the activity of the department.¹⁶ The reintroduction of general surgery into the arena of trauma care provides an additional clinical base for the clinicians as well as a larger group requiring operative interventions.

Data on the success of current funding mechanisms remain somewhat elusive and contradictory. In an effort to look at the impact of elderly patients on trauma care costs, Newell et al reviewed the total cost and net margin of injured patients of patients less than 64 years of age compared to those 65 and older.¹⁷ The older group had a better financial picture than the younger group; however, the costs exceeded reimbursement for all trauma patients. Slightly contrary reporting comes from Henneman et al who compared emergency department (ED) admissions to admissions from any other part of the system and found that the ED admissions were more profitable.¹⁸ While they did not have a subset analysis, their facility is a level 1 trauma center. Taheri et al examined the revenue at a verified Level 1 trauma center.¹⁹ In their review, the care of injured patients generated significant income acutely as well as over time as the patients continued to seek care at their hospital over time. Of note, the payer mix at their facility only had a self pay rate of 6%.

Conclusion

Funding of trauma systems in today’s health care environment remains a work in progress. It requires introspective assessments of local, regional and statewide needs. Persistent interaction with legislative teams and trauma leadership is needed to initiate and maintain system level funding. Continued documentation of efficiency and outcomes allow involved groups to verify the return of investment and to continue to justify funding. While we have not quite yet reached the tipping point, trauma systems may ultimately been seen as essential infrastructure by the public and by policy makers.

Biography

Douglas Geehan, MD, FACS, MSMA member since 2004, is an Associate Professor of Surgery at the University of Missouri-Kansas City School of Medicine.

Contact: Docgeehan@aol.com