Subacute Care

Subacute care units are also called transitional care units. In the 1990s, subacute units were developed to fill the gap for those patients who no longer needed acute hospital care, but were not strong enough to return home. This gap was widened by the Medicare prospective payment system that began for hospitals in the United States in the mid 1980s. This payment system is based on diagnosis-related groups (DRGs). Hospitals are paid a predetermined amount for each admission based on the DRG, regardless of the length of the hospitalization or the costs incurred. Under the DRG payment system, hospitals have an incentive to shorten lengths of stay. In contrast, since the inception of Medicare and for most of the 1990s, long-term care facilities were reimbursed on a “cost plus” basis. Individuals who had an established treatment plan but continued to have complex medical needs were ideal for the subacute unit. These units were directly reimbursed for the specialized equipment, medications, or personnel required.

Subacute units must follow state and federal regulations for long-term care, which in most cases are more stringent than hospital regulations. These units are almost exclusively located in hospitals or nursing homes. A unit must include a minimum of 15 beds and be located in a designated area. Subacute patients cannot be scattered among other patients in the facility. Affiliations with hospitals and nursing homes provide savings from economies of scale and a built-in referral base.

Subacute units provide complex medical care and rehabilitation. The ratio of nurses to patients is higher than in a nursing home. The cost of care in a subacute unit is intermediate between hospital and nursing home care. Physical, occupational, and speech therapists must be available as employees or on a contracted basis. The unit must have a certified nursing home administrator, a social worker, and a medical director. Because the care is more complex, attending physicians typically visit the subacute unit once or twice a week, in contrast to nursing home visits, which are often monthly.

Team meetings that include all participants in the patient's care occur on a regular basis to share information and develop an individualized treatment plan. Patient and family participation in these meetings is encouraged. The patient's goals are integral to the treatment plan. Most admissions are for two weeks or less, and most residents return to their homes.

Current Medicare regulations require a three-day hospital stay before admission to a subacute unit. Managed care organizations pay for subacute care without a recent hospitalization if there is a sudden change in the patient's condition and subacute care can meet the needs. Examples of situations where a person could be directly admitted to a subacute unit include (a) a fracture that requires pain control and nursing care and (b) pneumonia that requires intravenous antibiotics. Examples of subacute care after a hospitalization include (a) rehabilitation after joint replacement and (b) treatment of an infected surgical wound that is too complex for home care. Some subacute units can also manage ventilator dependent patients.

[Page 541]At the end of the 20th century, Medicare reimbursement for subacute units and nursing home changed to payment based on resource utilization groups (RUGs). RUGs are analogous to the DRGs used to reimburse hospitals. This limited reimbursement has increased the challenges of providing care for these transitional and fragile patients.

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