The LA Model: Inpatient and Emergency Services Component Update
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1 fv The LA Model: Inpatient and Emergency Services Component Update FINAL REPORT May, Presented to the Steering Committee for the Study of the Health Care Delivery System of Los Angeles County on May, The Steering Committee for the Study of the Health Delivery System of Los Angeles County (Steering Committee) oversees the development of the LA Model, a computerized decisionsupport tool to assist collaborative public/private health services planning in Los Angeles County through. The Steering Committee is staffed by the National Health Foundation. The Lewin Group is the technical consultant for model development. For additional copies of this report or for more information about or a demonstration of the LA Model, contact: The National Health Foundation South Figueroa Street, Suite Los Angeles, CA (Julia Pennbridge, Ph.D.) (Jean Tsubota)
2 Final Report, May STEERING COMMITTEE MEMBERS > Anthony Abbate, Vice President LA al Office, Healthcare Association of Southern California > Diana Bonta, Ph.D., Director, City of Long Beach Health Department * Melinda Beswick, CEO, California Medical Center > Richard Chambers, Associate al Administrator for Medicaid, Health Care Financing Administration (auditing) > Carl Coan, Executive Director, Pediatric and Family Medical Center and Community Clinic Association of Los Angeles County > Areta Crowell, Ph.D., Director, Los Angeles County Department of Mental Health * Patricia Cunningham, al Vice President, Catholic Healthcare West Southern California > Mark Finucane, Director of Health Services, Los Angeles County > Lark GallowayGilliam, Executive Director, Community Health Councils * Matthew Gerlach, CEO, Beverly Hospital > Frances Hanckel, Sc.D., Chief Operating Officer, Long Beach Memorial Medical Center > TBN, American Medical Group Association (invited) > David E. Janssen, Chief Administrative Officer, Los Angeles County > Mandy Johnson, Executive Director, Community Clinic Association of Los Angeles County > Brian Johnston, MD, President, Los Angeles County Medical Association * Ron Kauffman, Chief of Staff, LA County USC > Gerald F. Kominski, Ph.D., UCLA School of Public Health > R. Dwight Lee, MD, MPH, Director, City of Pasadena Health Department > James Ludlam, Esq.; Musick, Peeler & Garrett > Joseph McQuirter, DDS, Chief of Oral Surgery, LAC King/Drew Medical Center > Rita Moya, President & CEO, National Health Foundation (ex officio) * Bill Noce, CEO, Childrens Hospital Los Angeles > Judith Ann North, Administrator, Kaiser Permanente > Janet OlsenCoyle, Chief MediCal Policy Division, California Department of Health Services (auditing) > William Parente, President & CEO, Santa Monica Hospital Medical Center > Joe Pechardo, Managing Director, Northeast Community Clinic and Los Angeles Community Health Center Coalition > Tony Rodgers, CEO, LA Care > Nancy Rubin, Los Angeles County Department of Health Services > Corinne Sanchez, Esq., CEO, El Proyecto del Barrio, Inc. and Los Angeles Community Health Center Coalition > James G. Terwilliger, Vice Provost, UCLA Center for Health Services > Robert E. Tranquada, MD, USC School of Medicine (CHAIR) > Ron Williams, President, Blue Cross of California and Chair, Health Issues Committee, LA Area Chamber of Commerce * New names to the Ambulatory Care Component Steering Committee Roster
3 Final Report, May DATA SUBCOMMITTEE MEMBERS» Anthony Abbate, Vice President, Los Angeles al Office, Healthcare Association of Southern California Wilma Alien, Public Health Administrator, Pasadena Health Department Andrew Amster, Assistant Director for Care Assessment and Improvement, Kaiser Permanente Deborah Alvarez, Senior Manager, The Lewin Group Andy Amster, Assistant Director for Care Assessment & Improvement, Kaiser Permanente Ruel Berris, Manager of Programs & Systematics, National Health Foundation Horace Clark, III, President, Diversified Data Design Corp. Michael Cousineau, Ph.D., Consultant, Los Angeles County Dept. of Health Services Wendy Dorchester, Ph.D., Administrator, Decision Support Services, Long Beach Memorial Medical Center Virginia Duval, Ph.D., Consultant, Los Angeles County Dept. of Mental Health Mandy Johnson, Incoming Executive Director, Community Clinic Association of Los Angeles County Deborah Lachman, General Manager, Southern California Individual and Small Policy Group, Blue Cross of California Margaret Lee, Ph.D., Director of Planning & Information, Los Angeles County Dept. of Health Services» Dana E. McMurtry, Director, Health Policy, Research and Support; The California Endowment Marge Nichols, M.A., Research Manager, United Way of Greater LA Julia Pennbridge, Ph.D., Director of Research and Evaluation, National Health Foundation Larry Portigal, Chief of Data Analysis, Los Angeles County Dept. of Health Services» Wendy Schiffer, Facilities Implementation Team, Los Angeles County Dept. of Health Services David Sloane, Ph.D., Associate Dean, University of Southern California» Timothy Snail, Consultant, The Lewin Group» Srija Srinivasan, Senior Associate, The Lewin Group * Robert E. Tranquada, MD, CHAIR, USC School of Medicine» Linda Velasquez, MD, MPH, Director, Maternal, Child and Adolescent Health, City of Long Beach, Department of Health and Human Services» Laurie Waits, Strategic & Business Planning, L.A.Care Health Plan Sharon Yee, Health Insurance Specialist, Division of Medicaid, Health Care Financing Administration
4 Final Report, May STAFF National Health Foundation Daniel Kwon, Project Assistant Ruel Berris, Manager, Information Systems Julia Pennbridge, Ph.D., Director of Research and Evaluation Jean Tsubota, MA, Project Manager CONSULTANTS The Lewin Group Deborah Alvarez, Senior Manager Linda Bergthold, Ph.D., Vice President Reena Gulati, Research Assistant Timothy Snail, Consultant Srija Srinivasan, Senior Manager The following Healthcare Association of Southern California members funded this project: Adventist Health Systems Alhambra Hospital Bay Harbor Hospital Beverly Hospital BHC Alhambra CedarsSinai Medical Center Childrens Hospital Los Angeles CHW Southern California Encino Tarzana al Medical Center Granada Hills Community Hospital Huntington East Valley Hospital Kedren Community Mental Health Center..., Los Angeles County Department of Health Services.^ Long Beach Memorial Medical Center Orthopaedic Hospital Pacific iance Medical Center Pomona Valley Hospital Medical Center Providence Saint Joseph Medical Center Queen of Angels/Hollywood Presbyterian Medical Center Saint John's Health Center UCLA Medical Center UniHealth USC University Hospital in
5 LA Model: tnpatient and Emergency Services Component Update Final Report, May EXECUTIVE SUMMARY The updated version of the LA Model, a computerbased decision support tool developed in, predicts future supply and demand for inpatient and emergency room services in Los Angeles County through the year. The volunteer Steering Committee that oversaw this updating project requested that, in addition to considering predictions, several hypothetical bed sizes for a rebuilt LAC + USC facility be considered to determine what impact each would have on overall supply and demand. Specific results from the updated LA Model include: A significant projected shortage in emergency room services capacity by the year. Currently, percent of the countywide emergency room capacity is at risk because of financial or physical factors. In, the area around LAC + USC Medical Center, percent of the emergency room capacity is at risk. Completing all County planned renovation projects, such as the rebuilding of LAC + USC, would reduce the emergency room capacity shortage by half. Completing the rebuilding of LAC + USC with a bed facility would contribute to a surplus of bed capacity in the area that is estimated at, beds by. The project, which was supported by the members of the Healthcare Association of Southern California from Los Angeles County, was carried out by The Lewin Group, a healthcare consulting firm that developed the original LA Model under the direction of the National Health Foundation. The updating process focused on adding new demographic and utilization data and collecting new information regarding existing and planned inpatient and emergency room capacity. The volunteer Steering Committee of local healthcare and governmental leaders selected the data sources and data elements utilized in the updating process. The purpose of running the LA Model using various bed sizes (,,, and ) was to help inform decision making regarding the rebuilding of LAC + USC but because of the nature of the results, the bed size of LAC + USC is not a key driver of the overall level of under or oversupply of inpatient beds in its region. For all hypotheticals, the LA Model predicts a serious under supply of emergency room capacity throughout the County now and in the years and, The model also predicts an oversupply of inpatient beds in the service area around the county facility, now and into the future. Because emergency room capacity cannot be disassociated from an inpatient facility, any discussion of rebuilding LAC + USC must take into account the need for inpatient beds. Note: The LA Model Inpatient and Emergency Services component does not include any financial data and its findings apply at the regional, not the individual facility level. IV
6 LA Model: Inpatient arid Emergency Services Component Update Final Report, May LA MODEL: INPATIENT AND EMERGENCY SERVICES COMPONENT UPDATE PURPOSE The overall LA Model is conceived as having four distinct components: inpatient and emergency services, ambulatory care, mental health and public health. The first component, Inpatient and emergency services (IP/ES), was completed in and has been used by planners, policy makers and researchers. It was designed to predict the supply and demand of inpatient and emergency services through, and used baseline date from. Given the changes that have occurred in the health care field since then, and because we now have data, it was decided to update the baseline data and to review several of the basic assumptions driving this component of the model. As with the development of all components of the LA Model, the Steering Committee oversaw and reviewed the update of data sources, data elements, and revised assumptions. They also requested that the model be run to compare findings from the revised and original models and to assess the impact of different bed sizes ( and ) on the supply and demand of inpatient and emergency room services in, the region containing LAC + USC. The findings reported here represent the outputs from the data and assumptions approved by the Steering Committee. No other findings have the Steering Committee's stamp of approval. The Healthcare Association of Southern California (HASC), which funded this update, also requested that a run of LAC + USC bed size be performed. SOME CAVEATS ABOUT THE UPDATE This update was completed in five weeks. The quick turnaround time required the Steering Committee to prioritize potential update items and to focus on those of highest priority. Other items were left unchanged. Two important caveats: First, the LA Model as a whole does not contain data regarding the financial implications of questions about capacity and demand. Second, although the ambulatory care component of the LA Model is almost complete, the update did not link the inpatient and emergency services component to the ambulatory care component. The two components are compatible in many ways (geographic unit, age and ethnicity groupings), but they are not yet linked. METHODS The inpatient and emergency services component combines drivers of supply and demand. Users therefore can assess the balance between supply of and demand for services in ten geographic regions. Population demographics, population coverage, service use and migration patterns drive demand; actual and planned capacity are major supply drivers. These drivers combine to show projected capacity utilization. Figure provides a conceptual representation of this component.
7 Figure : Conceptual representation of the LA Model: Inpatient and Emergency Services Component tl. Population Denidgraphic. Major Assumptions & Results. Population Coverage I. Evaluation Criteria o ct a ). m. Legislative Scenarios Demand Drivers Supply Drivers. Individual Hospital Scenario select fraction of capacity and use change major assumptions CD CD CO I ino < C _»T CO Ss xj o
8 Final Report, May This component also allows the balance between supply of and demand for inpatient and emergency room services to be assessed in each of ten regions. The ten regions were originally selected based upon various criteria including current utilization and travel patterns as well as area demographic characteristics. The ten regions represent an aggregation of Los Angeles County's districts established to assist with targeted planning. Figure shows how the County is divided into the ten regions. Criteria for identifying update items Four criteria were used to guide the identification of update items. To be changed, an item had to have: ) a significant effect on the supply of or demand for inpatient and/or emergency room services; ) changed measurably since the model was completed in and have new data available to retrieve and analyze within the project's fiveweek time frame; ) the capacity to be reprogrammed within the project's fiveweek time frame; and ) the potential, that if changed, it would bring the entire component into greater compatibility with the Ambulatory Care Component. Items updated Based on the above criteria, three items of this component were recommended and approved for updating: Population coverage distribution, service use, and actual and planned capacity. Population coverage distribution was updated by using actual data for insurance coverage and HMO penetration baselines and by using the same approach as the LA Model: Ambulatory Care Component to project coverage and HMO penetration. The service use baseline was updated by using more recent OSHPD data for inpatient and emergency room services and by using information from local health plans and researchers to develop use rate projections. The actual inpatient and emergency room capacity and the capacity planned in the future was updated with data from a new hospital survey distributed by HASC and by the most recent Office of State Health Planning Department data for facilities which did not return surveys. Updated assessments of hospitals' physical and financial risk were based on the results from the HASC survey and from The Lewin Group's Payment Simulation Model.
9 Final Report, May Figure : LA County s for the LA Model: Inpatient and Emergency Services Component.
10 Final Report, May MAJOR NEW ASSUMPTIONS In addition to updating the baseline data, five major assumptions were changed. These assumptions and projections are as follows: Assumption. The distribution of the population by source of health insurance coverage will remain relatively stable over time. Population by Source of Health Insurance, Source of Coverage Medicare MediCal Commercial/Other Uninsured Total Type FFS HMO FFS HMO NonHMO HMO N/A,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, Assumption. HMO penetration will continue to grow. The update incorporates new trend data regarding the level of HMO penetration for Medicare and MediCal. HMO Penetration by Source of Health Insurance, Source of Coverage Medicare MediCal Commercial/Other Overall % % % % % % % % % % % % Assumption. Based on projections from plans and trends observed from to, HMO inpatient use rates will continue to decline from their baseline. HMO Inpatient Days/ by Source of Coverage, Source of Coverage Medicare MediCal Commercial
11 Final Report, May Assumption. NonHMO use rates will follow same rate of decline as HMO use rates for Medicare and Commercial, and will follow a lower rate of decline than HMO days for MediCal. NonHMO Inpatient Days/ by Source of Coverage, Source of Coverage Medicare MediCal Commercial/Other Uninsured Assumption. Based on trends observed between and, emergency room use rates will decline between and Emergency Room Visits/ by Type of Visit, Type of E/R Visit Urgent Nonurgent Critical FINDINGS Six distinct groups of findings from the inpatient services and emergency room services component are reported in the following order:. Service capacity at risk: service capacity likely to be lost because of physical plant or financial risk,. Planned renovation projects: size of planned remodeling and renovation projects,. Balance of supply and demand with no renovation projects complete: balance of supply and demand by region, without any of the planned projects being completed,. Balance of supply and demand with all planned projects completed: balance of supply and demand by region with air planned projects being completed,. Estimates for updated baseline data, and. Specific information about findings.
12 Final Report, May. Service capacity at risk. Twentyone percent of the County's inpatient service capacity is "at risk" based on physical and/or financial factors. Of the beds "at risk", two thirds are "at risk" based on physical characteristics only. Estimated Inpatient Capacity (beds) with Closure/Consolidation of Capacity "At Risk" Estimated Capacity (Beds),,,,,,,,,,,,,,,,,, Capacity Reduction Beds,,, % % % % % % % % % % % % Survey respondents represent % of the total available beds in the County. Twentysix percent of the emergency room service capacity is "at risk" based on physical and/or financial factors. Estimated Emergency Room Capacity (visits) with Closure/Consolidation of Capacity "At Risk" EstimatedCapapcity,,,,,,,,,,,, (Annual ER Visits),,,,,,,,,,,, Capacity Reduction Visits % %, %, %, %, % %, %, %, %, %, %
13 Final Report, May. Planned renovation projects. A number of facilities anticipate completion of renovation projects. Some of these projects address existing physical risk factors, while others are intended to decrease existing capacity. Summary of Inpatient Capacity (beds) in Renovation Projects County, DSH Other, ',, Summary of Emergency Service Capacity (visits) in Renovation Projects County,,, DSH,,,, Other,,,,,,,,,,,,,,,,,,,
14 Final Report, May. Balance of supply and demand with no renovation projects completed. There is a projected excess capacity of inpatient beds in almost all regions, for almost all bed types, even if.anticipated projects are not completed. Projected Year Excess (Shortage) of Beds by and Bed Type, Assuming NO Projects are Completed. ICU () () (), MedSurg, (), Bed Type Psych () () () () Subacute (,) () OB Peds, (),,,,, The county is projected to face a significant shortage of emergency room services capacity by the year, especially without completion of planned projects. Projected Year Excess (Shortage) of ER Visits by and Visit Type, Assuming NO Projects are Completed Nonurgent (), (,) (,) (,), (,) (,) (,) (,) (,) E/R Visit Type Urgent (), (,) (,) (,), (,) (,) (,) (,) (,) Critical (,) (,) (,) (,) (,) (,) (,) (,) (,) (,) (,), (,) (,) (,), (,) (,) (,) (,) (,,)
15 Final Report, May. Balance of supply and demand with all planned projects completed. Completion of anticipated projects exacerbates the projected excess of inpatient service capacity. Projected Year Excess (Shortage) of Beds by and Bed Type, Assuming Projects are Completed ICU () (), MedSurg,, Bed Type Psych () () (), Subacute (,) () OB, Peds j, (),,,, Completion of planned projects would alleviate almost half of the projected shortage in emergency room services capacity. Projected Year Excess (Shortage) of ER Visits by and Visit Type, Assuming Projects Are Completed Nonurgent (), (,), (,), (,) (,) (,) (,) (,) E/R Visit Type Urgent (), (,), (,), (,) (,) (,) (,) (,) Critical (,) (,) (,) (,) (,), (,) (,) (,) (,) (,) (,), (,), (,), (,) (,) (,) (,) (,)
16 Final Report, May. Estimates for updated baseline data. The updated component confirms the findings from the original component, except that the situation has worsened in the interim. The County had an estimated oversupply of inpatient beds in most regions, for most bed types in. Estimated Year Excess (Shortage) of Beds by and Bed Type ICU () () MedSurge,, Bed Type Psych () () () () () Subacute (,) () OB () Peds, (,),,,, The county had a shortage of emergency room capacity in in most regions for most visit types. Excess (Shortage) of ER Visits by and Visit Type Nonurgent (), (,), (,), (,) (,) (,) (,) (,) E/R Visit Type Urgent (,), (,), (,), (,) (,) (,) (,) (,) Critical (,), (,), (,), (,) (,) (,) (,) (,) (,), (,), (,), (,) (,) (,) (,) (,)
17 Final Report, May. Specific findings. The model's findings for the County, overall, are confirmed when looking specifically at. Projected Year Excess (Shortage) of Beds in by Bed Type, Assuming Projects are Completed ICU MedSurg, Bed Type Psych Subacute OB Peds, Projected Year (Shortage) of ER Visits in by Visit Type, Assuming Projects Are Completed Nonurgent (,) E/R Visit Type Urgent (,) Critical (,) (,) Running the model with a bed LAC/ USC rebuild allowed a comparison with the model's original data inputs. The level of inpatient overcapacity has grown as use rates have declined more quickly than available capacity. Projected Year Excess of Beds in by Bed Type, Assuming Projects Are Completed Original Model Projections ICU MedSurg, Bed Type Psych Subacute OB () Peds, Updated Model Projections ICU MedSurg, Bed Type Psych Subacute OB Peds,
18 Final Report, May A comparison (under a bed LAC/ DSC scenario) to the original model highlights the growth of the projected emergency room service shortage in region. Projected Year Excess (Shortage) of ER Visits in by Visit Type, Assuming Projects Are Completed Original Model Projections Nonurgent, E/R Visit Type Urgent (,) Critical (,) (,) Updated Model Projections Nonurgent (,) E/R Visit Type Urgent (,) Critical (,) (,) The bed, bed, and bed scenarios mirror the results incorporated into the model's baseline. Projected Year Excess of Beds in by Bed Type, Assuming bed LAC + USC Rebuild ICU MedSurg, Bed Type Psych Subacute OBO Peds, Projected Year Excess of Beds in by Bed Type, Assuming bed LAC + USC Rebuild ICU MedSurg, Bed Type Psych Subacute OBO Peds, Projected Year Excess of Beds in by Bed Type, Assuming bed LAC + USC Rebuild ICU MedSurg, Bed Type Psych Subacute OBO Peds,
19 *(.! LA Model: Inpatient and Emergency Services Component Update Final Report, May INTERPRETING THE RESULTS Several limitations of the LA Model must be considered when interpreting these results:. The Model is designed for macrolevel community planning rather than individual facility planning. However, individual facilities may use the model's results to inform their strategies by combining it with their own proprietary data. The Model is silent on policy issues such as the Board of Supervisor's interpretation of their appropriate scope of Section responsibility. Policy information can be fed into the model to project the impact on supply and demand.. The Model identifies potential capacity that can be bought or sold but does not incorporate the likely prices or terms under which those arrangements could be negotiated.. The projected inpatient overcapacity and emergency service shortages are not payerspecific. That is, an available bed is treated as available capacity, regardless of the insurance coverage of those generating the demand for it. While this component provides useful information on the inpatient and emergency services capacity "picture," a complete understanding of health care service supply and demand requires looking across settings and systems of care. When the Ambulatory Care Component is linked to the Inpatient and Emergency Services Component, LA Model users will gain a more comprehensive picture of the health service system. Results from the LA Model: Inpatient and Emergency Services Component represent only one set of information to be considered in health services planning and policy making.
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