CHAPTER 8
Inpatient Facilities and Services
HOSPITAL
Legal description:
• Minimum 6 beds
• Provides diagnosis and treatment
• Licensed by state
Other appellations in current use:
• Medical Center—offers a wide array of specialized services
• Hospital System or Health System—provides a wide array of services in addition to
acute care.
EVOLUTION OF HOSPITALS
Five stages:
1. Primitive institutions of social welfare
2. Distinct institutions of care for the sick
• Distinct from existing almshouses and poorhouses
• Sometimes, an extension of the above public (government) institutions
• Poor hygiene, inadequate ventilation, and care provided by untrained nurses
• Founding of voluntary (nongovernment) hospitals became predominant;
financed by rich philanthropists.
3. Organized institutions of medical practice
• advance of medical science, transformed hospitals into institutions of medical practice
• Improvements in hygiene, advanced medical care, and surgical services made hospitals
4. Advanced institutions of medical training and research
5. Consolidated systems of health services delivery
• Consolidation necessitated by reimbursement changes that led to declines in
utilization
HOSPITAL EXPANSION: Late 1800s to Mid-1980s
• Hospitals grew once they became institutions of medical practice and surgical work expanded
• Reasons for growth:
2. Development of specialized technology
4. Development of professional nursing
5. Growth of health insurance
6. Role of government
o Hill-Burton Act in 1946 provided federal construction grants to states
o Medicare and Medicaid extended coverage to the elderly and the indigent
o Between 1965 and 1980, hospital beds increased by 37%
HOSPITAL DOWNSIZING: Mid-1980s Onward
• Changes in Reimbursement
– Cost-plus to PPS based on DRGs—financial incentives to reduce length of inpatient
stay
– Decrease in inpatient utilization
• Hospital Closures
– Economic constraints; approximately 500 hospitals, both rural and urban, closed
between 1990 and 2000
UTILIZATION MEASURES AND OPERATIONAL CONCEPTS
• Discharges: Total number of patients discharged from a hospital’s acute care beds in a given
period. Discharges include newborns and deaths. It is an indicator of access and utilization.
• Inpatient day (patient day or hospital day): A night spent by a patient
– Cumulative patient days = Days of care
– Direct correlation between age and utilization
– Utilization is highest among the 85+ age group
• Average length of stay (ALOS): Days of care / Discharges
– An indicator of severity of illness and of resource use
• Capacity: Number of beds set up and staffed
• Average daily census: Average number of beds occupied per day
• Occupancy rate: Percent of capacity occupied
HOSPITAL UTILIZATION AND EMPLOYMENT
Long-term factors: Changes in the size and nature of the US population, advances in medical
technology, and changes in health insurance. Certain pharmaceuticals have reduced the need for
hospitalization. Starting around 1995, various outpatient care settings started employing more
TYPES OF HOSPITALS
There are numerous ways to classify. The classifications are not mutually exclusive.
1. Ownership
a. Public—Government ownership
They incur higher utilization compared to voluntary and proprietary hospitals.
• Federal—do not serve the common public; serve special groups—
2. Public Access
Community hospital
• Nonfederal, short-stay (ALOS of 25 days or less, acute)
3. Multiunit Affiliation
Multihospital chains (multihospital systems – MHSs)—two or more hospitals are
owned, leased, or contractually managed by a central organization. More than
4. Type of Service
a. General hospitals
Provide a variety of services to meet the general medical needs of the community such as
general and specialized medicine, general and specialized surgery, obstetrics, etc.
b. Specialty hospitals
cases to general hospitals.
• The ACA of 2010 places severe restrictions on the opening of new ones or
expansion of existing ones.
c. Psychiatric hospitals
Diagnostic and treatment services for a variety of severe mental conditions, such as
d. Rehabilitation hospitals
• Therapeutic services that restore functioning in patients who have suffered a
recent disability
• Medicare rule: 75% of the inpatients must require intensive rehabilitation
e. Children’s hospitals
• Specialize in complex, severe, or chronic illnesses among children
• Generally have neonatal and pediatric intensive care, trauma care, and
5. Length of Stay
a. Short-stay: ALOS of 25 days or less: Acute care
b. Long-stay: ALOS >25 days: Subacute care, TB, chronic disease, psychiatric
6. Location
• Urban (located in an MSA)
• Rural hospitals (outside an MSA)
7. Size
• No standard way to classify by size
8. Other Types of Hospitals
a. Teaching hospitals—have AMA-approved residency programs for physicians.
Approximately, 400 teaching hospitals are members of COTH.
• Teaching hospitals organized around medical schools and heavily involved in
research activities are referred to as academic medical centers
b. Church-affiliated Hospitals
o Catholic sisterhoods first established these hospitals
EXPECTATOIONS FROM NONPROFIT HOSPITALS
IRS Code, section 501(c)(3):
– tax-exempt status
– must provide some defined public good (service, education, welfare)—
Main Issues:
– They often compete head on with for-profit hospitals (institutional theory actually
predicts such behavior because both for-profit and nonprofit hospitals face similar
regulatory, legal, and professional constraints; the tendency is for them to imitate
each other)
HOSPITAL GOVERNANCE
Tripartite structure:
• Board of trustees (governing body)—define the mission, set long-term direction, establish
relationship with the community, establish broad operational policies, carry legal responsibility
for the operations, appoint and evaluate the CEO, approve appointment of physicians to the
medical staff
• CEO—responsible for day-to-day operations to accomplish the mission and objectives in
LICENSURE, CERTIFICATION, ACCREDITATION
• Licensure—state function; mandatory
Requires compliance with state laws, building codes, fire safety, sanitation standards
• Certification—federal function
Medicare
– Requires the hospital to satisfy the conditions of participation—federal standards for
health, safety, and quality
• Accreditation—private function (Joint Commission); voluntary
– Requires compliance with Joint Commission standards
THE MAGNET RECOGNITION PROGRAM
– Designation conferred by the American Nursing Credentialing Center
ETHICS PRINCIPLES
• Respect for others
– Autonomy: patient empowerment
– Truth-telling: honesty
LEGAL RIGHTS AND PATIENT BILL OF RIGHTS
– Patient Self-Determination Act of 1990
– Inform patients of their rights upon admission
– Main rights:
• confidentiality
• informed consent
Informed consent
– Right to make an informed choice regarding medical treatment
– Right to obtain complete current information on diagnosis, treatment, and
prognosis
Advance directives
• Do not resuscitate orders
• Living will
Ethical decision making
Ethics committees
TERMINOLOGY
• Academic medical center—A hospital or health system organized around a medical school.
These centers train physicians, provide specialized services, and actively engage in research and
clinical investigations.
• Board of trustees—The governing body of a hospital. It is legally responsible for hospital
operations, and is charged with defining the mission and long-term direction of the hospital.
• Certification—Conferred by the U.S. Department of Health and Human Services, it entitles a
hospital to participate in Medicare and Medicaid. A necessary condition is for the hospital to
comply with the conditions of participation.
• Credentials committee—A committee that reviews qualifications of clinicians for admitting
privileges.
• Critical access hospital— Medicare designation for small rural hospitals with 25 beds or less
that provide emergency medical services besides short-term hospitalization for patients with
noncomplex health care needs. They receive cost-based reimbursement from Medicare to keep
of life available after resuscitation is likely to be worse than before.
• Durable power of attorney—A written legal document in which the patient appoints another
individual to act as the patient’s agent for purposes of healthcare decision–making in the event
that the patient is unable or unwilling to make such decisions.
• Ethics committee—An interdisciplinary committee responsible for developing guidelines and