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Hospitals can save by doing less - Thomson Reuters

Sun April 5, 2009

By Maggie Fox, Health and Science Editor

WASHINGTON, April 3 (Reuters) - Hospitals in the United States can help patients by doing less and could save at least $4 billion in the process, Thomson Reuters says.

The international professional information provider, parent company to Reuters news, says its comparative analysis can help hospital chief executives lower needless costs by looking for their weak spots when compared to similar hospitals.

"We are talking about saving money and improving quality at the same time," Jean Chenoweth, senior vice president at Thomson Reuters for performance improvement, said in a telephone interview.

"You don't want to do what some companies do, which is do gigantic cutbacks, saying 'We are going to cut 15 percent of all employees,'" said Chenoweth, who also heads up Thomson Reuters Top 100 Hospitals program.

The true savings could top $20 billion over three years, Chenoweth estimated, but she said the $4 billion figure seemed more easily achievable.

One example of a cost-saving measure: reducing infections.

Treating hospital acquired infections costs billions -- up to $4 billion a year alone for Methicillin-resistant Staphylococcus aureus, or MRSA, according to one estimate from Pfizer Inc. (PFE.N).

Another is readmissions. Several analyses show that when patients come back to hospitals too soon after surgery or other treatments, it is a symptom of improper care that hurts the patient and costs hospitals and insurers.

The analysis resembles that from Dartmouth Atlas, a non-profit academic venture that compares healthcare costs and outcomes around the United States. By showing large national variations in spending and results, its developers also conclude that efficiency can save money and also lead to better care for patients.

Healthcare reform is at the top of President Barack Obama's agenda and Congressional leaders say they must pass a bill some time this year. Both branches of government say cutting costs in the $2.5 trillion U.S. healthcare system is vital.

SURVEY REFLECTS WORRY

A survey released on Sunday found that 69 percent of those polled were worried about the cost of healthcare, compared with 37 percent who feared losing their jobs.

The Health Security Index poll by survey firm Yankelovich found that 51 percent of the 1,200 adults thought the U.S. healthcare system was getting worse and 83 percent said affordable care for everyone should be one of Congress' most important issues this year.

Chenoweth said her team's approach uses a comparative analysis to show a hospital where its particular weak spots are and where it should focus efforts to bring down costs.

The nine key areas include mortality, medical complications, average length of stay, expenses, profitability, cash-to-debt ratio, patient safety, overall performance and how well the hospital sticks to clinical standards of care.

"A recent Thomson Reuters report indicated that 50 percent of U.S. hospitals are now unprofitable," said Mike Boswood, president and chief executive officer of the Healthcare and Science business of Thomson Reuters.

"We are undertaking this initiative because many of our hospital customers are under severe financial pressures."

Chenoweth said the company would offer its findings to the Obama administration and Congress. (Editing by John O'Callaghan)