Long-term care hospitals treated fewer short-stay patients from fiscal years 2003 to 2006 as a result of cuts in Medicare reimbursement, according to a memo from the Department of Health and Human Services Office of Inspector General. But the agency questioned the appropriateness of some of the short-stay visits.

The OIG found that patients discharged earlier than the short-stay outlier threshold could have been better treated and at less cost in acute hospital settings. The OIG expressed concern that LTCHs have a financial incentive to discharge patients on a particular date. Short-stay outliers are long-term care hospital stays that conclude before they reach the average length of stay for other LTCH patients. LTCHs provide post-acute care to patients with complex medical conditions.

The Centers for Medicare & Medicaid Services has been closely scrutinizing post-acute healthcare providers, including skilled nursing facilities, to create a post-acute payment system.

See the report at
http://www.oig.hhs.gov/oei/reports/oei-01-07-00290.pdf.