3 opportunities to reduce costs via contact-free continuous monitoring

The latest Frost & Sullivan White Paper examines three opportunities to produce cost savings in healthcare. This year’s report focuses on contact-free continuous monitoring (CFCM) and the savings it can bring to hospitals, while improving the overall quality of care.

For research purposes, the paper uses a fictional hospital, General Hospital USA, as an example for most U.S. hospitals. This hypothetical facilitity is is a 200-bed hospital near Chicago, with 80 medical and/or surgical beds and an average occupancy rate of 85 percent. But the hospital reaches full occupancy about once every five days, leading to lost revenue opportunities.

1. CFCM can shorten length of hospital stay, bed availability and create more revenue.

The biggest opportunity for CFCM to boost revenue is by increasing bed availability.  At General Hospital USA, the medical and/or surgical (med/surg) unit has 80 beds, with an average capacity of 85 percent and an average patient length of stay (LOS) of four days. The per admission charge is $13,354. With CFCM, there is a 9 percent reduction in the LOS within the med/surg unit and a 45 percent reduction in the ICU unit. These chances mean the hospital could free up beds more quickly and create further revenue of $1.9 million per year.

2. CFCM uses new value-based payment models that reward positive outcomes and lower costs to capture more revenue.

After CFCM was introduced, reimbursements brought in an additional $89,953. With the transition from a fee-for-service (FFS) system to a fee-for-value system, there has been an increase in payments for both the healthcare system and payers. This transition also gives more emphasis on focusing on patient’s experiences and outcomes within the hospital.

3. CFCM supports coding using identification of undetected patient conditions.

Frost & Sullivan conducted research within a large hospital using CFCM to evaluate the percentage of conditions that went undented, misdiagnosed, or miscoded. CFCM can be used to offer better care to patients with conditions related to sepsis, arrhythmias, and respiratory distress, where detection can bring in further revenue by offering better care to those patients.  

In General Hospital USA, CFCM could be used to identify those patent conditions that had gone undetected. With a focus on sepsis, CFCM identified 1.2 patents with sepsis that had gone undetected. With just that 1.2 patient being identified, the hospital brings in an additional $32,123.50 in revenue. Thanks to CFCM, General Hospital USA reported a 5 percent increase in patients with diagnosis-related group billing for sepsis, cardiac arrhythmia and respiratory distress, leading to a further increase in revenue of $9,227.11. A total of $41,350 was brought into the hospital thanks to CFCM coding and assessing patients with these conditions. These patients are also less likely to be readmitted and have less complications then if CFCM was not implemented.