Patients at Miami-Dade’s safety net public hospitals are staying longer on average than they were a year ago, driving up labor costs and dragging down profits, according to Jackson Health System administrators addressing Thursday’s meeting of the Public Health Trust that oversees the system.
“A higher length of stay drives a higher cost per case,’’ said Mark Knight, chief financial officer of Jackson Health System. “Longer length of stay equals less profit.’’
As patients stay longer and profits dwindle, Knight said, staffing levels and employee overtime have increased.
“That is creating a negative effect on our bottom line because we are not realizing incremental net revenue to cover those incremental costs.’’
The higher costs and lower profits are draining resources from the financially struggling system, which seems headed toward a financial recovery after losing more than $300 million over a three-year period, and nearly going bankrupt about a year ago.
Jackson administrators said they will reconvene a task force of physicians, nurses and hospital executives to find ways to reduce patient stays.
Hospital administrators also intend to lower labor costs by reducing employee overtime, shifting nurses and physicians to areas of greater need, and “flexing down’’ the hours of part-time employees, said Carlos Migoya, chief executive.
In a memo to Trust members issued Monday, Migoya reported that Jackson has had modest budget surpluses for the first half of the year compared to the same period last year.
But he warned that long patient stays remain a challenge, and he hinted at staff reductions, stating that certain divisions within the hospital are “staffed above our productivity standards.’’
Jackson administrators cut the equivalent of 1,100 full time positions about a year ago, but Migoya emphasized that the newest cost-reduction strategy would not include significant layoffs.
“These are staffing changes,’’ he said, “not necessarily reductions.’’
Migoya said he shifted a group of nurses from the pediatric unit to other divisions within the main hospital because pediatrics was not as busy. The hospital also has hired a new director of labor productivity, Knight told the board.
Another issue dragging down hospital revenues is that many long-term patients on Medicaid have exceeded their annual fixed benefit for inpatient stays, which is 45 days.
In fiscal 2012, Knight said, Jackson saw $25 million in exhausted benefit denials from Medicaid.
But many of these financial challenges can be traced back to lengthy patient stays.
Jackson patients are staying an average of seven days at the hospital, compared to an average of four days per patient at other local community hospitals, Knight said.
The number of patients staying longer than 30 days has increased by 50 percent over last year, Knight told the board, and the number of patients staying longer than 120 days has doubled. He did not provide raw numbers.
Knight said many patients are staying longer than necessary because the hospital cannot discharge them safely to a nursing home or family members.
Nursing homes are full, he said, and some patients have felony criminal records and cannot be placed in group settings.