Hospitals see revenue opportunities in oxygen therapy for diabetics
- Revenues rather than proven benefit may be driving an increase in the use hyperbaric oxygen therapy to treat diabetic ulcers, Kaiser Health News reported.
- Since 2004, two years after Medicare began paying for the therapy, the number of U.S. hospitals with hyperbaric facilities has doubled — from 626 to 1,300 last year.
- The math speaks for itself. At about $500,000 to install a two-chamber hyperbaric machine and about $450 for a two-hour session, “hospitals can generate cash almost immediately,” John Peters, executive director of the Undersea & Hyperbaric Medical Society, told KHN.
In a tightening reimbursement environment, some hospitals are leveraging expensive technology and billings to grow their revenues while others are developing and marketing home-grown solutions. If a hospital can offer a service its competitors don’t have or offer treatment closer to a patient’s home, that can boost patient volume and more money.
To improve its financial outlook, University Medical Center of Southern Nevada eliminated several hundred positions, hired more doctors and invested in technology, including a new EHR and new pulmonary equipment. The strategy led to record volumes in the ER and surgery departments and flipped operating income from negative numbers to 7-10%.
During hyperbaric oxygen therapy, patients are treated to high doses of pure oxygen inside a pressurized chamber, the idea being that oxygen will stimulate blood vessel growth and speed wound recovery. Medicare covers the therapy for a number of conditions including failing skin grafts and radiation-damaged tissue, but a fast-growing population of diabetics — 29.1 million in 2014, according to the Centers for Disease Control and Prevention — is fueling much of its use.
Patients are typically treated for two hours a day, five days a week, for up to a month, but many treatments last longer. And yet the efficacy of hyperbaric therapy is disputed.
Still, with Medicare’s generous coverage it is can be an attractive revenue stream. Hyperbaric units installed at hospital-affiliated facilities are eligible for a facility fee on top of Medicare’s coverage rate, pushing ROI even higher.
- Kaiser Health News Hospitals Ramp Up Hyerbaric Therapy For Diabetes, Despite Concerns