eMJA Casemix Supplement: Casemix: challenges for nursing care

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Casemix: moving forward

Casemix: challenges for nursing care

Lesley E Long and Rosemary Mann

MJA 1998; 169: S44-S45

Synopsis - Introduction - A patient classification system for nursing - Illness severity measures - Quality and outcomes - Impact on clinical practice - References - Authors' details

Synopsis

An Australia-wide patient classification system for nursing is urgently needed as the health system attempts to develop benchmarks against which to measure and compare services.

Standardised measures of demand for nursing care must be developed to allow appropriate reimbursement and to act as proxies for illness severity.

Nurses need to identify the outcomes that measure the nursing contribution to episodes of care, and assist in developing outcome goals reflecting the efficacy of treatment and the quality of care.

A system of measuring nursing requirements and costs of early discharge and coordinated care programs is required. It must be consistent with nursing classifications and hospital costing systems.

Introduction
Casemix continues to present challenges to the nursing profession. Initially, the focus was on refining the Australian AN-DRG classification to more accurately reflect clinical practice and, although anomalies still exist, this has largely been accomplished. Currently, four issues pose a particular challenge to nursing and relate to integrating the AN-DRG classification with:
An Australian patient classification system for nursing;
Measures of illness severity within DRGs;
Measures of the nursing contribution to quality and outcomes; and,
Measures of nursing requirements and costs of home-based and coordinated care programs.

A patient classification system for nursing
Because patients within a DRG are not necessarily alike in terms of cost and nursing dependency, there is a need for a patient classification system for nursing.¹ This has become more urgent as the healthcare system attempts to develop benchmarks against which to measure and compare services. At present, each State and Territory has a very different system of patient classification for nursing acuity, which means that nursing content, reliability, validity and clinical meaning within AN-DRGs cannot be compared across Australia.
There have been problems reaching a consensus on nursing classification issues. If nursing does not understand (and agree on) its own cost structure, or its contribution to the costs of patient care, it cannot hope to negotiate prices for the nursing component of an episode of care.² A comparison of three nursing classification systems used in New York State found that estimates of nursing costs and nursing intensity (resource requirement and complexity of nursing care) varied because each system measured resource use differently.³
In South Australia, information is now available on nursing hours per patient-day and costs per patient-day. In 1995, a computer-based clinical decision-making program was successfully integrated with a computer-based nurse scheduling program. This system has been used in the major metropolitan hospitals and in a small number of larger country hospitals. Data collected can be aggregated to AN-DRGs and nursing costs compared across South Australian hospitals. Information from this system was used in the initial nurse costing study to develop the first nursing service weights incorporated into AN-DRGs. This system lends itself to continual refinement and innovation.
Consensus about Australian nursing costs and what constitutes nursing in Australia cannot be reached, and benchmarks cannot be developed, until the nursing profession develops a patient classification system for nursing which applies to the whole of Australia.
Illness severity measures
The second issue challenging nursing -- measurement of illness severity in terms of nursing dependency -- is directly related to patient classification.
Resource use within DRGs varies, as many AN-DRGs are far from homogeneous. Studies have shown that resource use within DRGs can be influenced by a range of factors including illness severity, disease complexity and comorbidities, as well as the socioeconomic profile of the patient.^4-7
The South Australian Department of Human Services deals with the issue of case complexity and severity by giving its metropolitan teaching hospitals and regional country hospitals a severity loading. This severity index is calculated on the basis of the number of diagnosis and procedure codes per patient record by AN-DRG, and takes into account length of stay factors and variations in patient acuity and complexity.⁸
Variables of illness severity have been considered in AN-DRG-3. These include age, specific complications and comorbidities, level of effect of complications and comorbidities, complicating effects of interactions between groups of complications and comorbidities, direct clinical and physiological observations, need for life-support or therapeutic interventions, and admission status.⁹ AN-DRG-3 addresses some illness severity issues by the inclusion of splits based on three complicating clinical factors (CCFs): complication and comorbidity levels, age, and the presence of malignancy.
Studies of illness severity and nursing have concentrated on developing standardised measures of demand for nursing care to allow appropriate reimbursement and to more accurately reflect nursing acuity. A study of the relationship between nursing care hours to DRGs and illness severity found that the demand for nursing resources was associated with illness severity, and that classification of patients by DRG and illness severity produced more homogeneous groups in terms of nursing resources.¹⁰
As nursing constitutes such a large proportion of the total expenditure for an episode of care, several tools have been developed to measure the impact of illness severity on nursing care. These include the Patient Intensity for Nursing Index (PINI), Nursing Intensity Weights (NIWs) and Case Mix Index (CMI), which are used across a range of medical and surgical DRGs in the United States, and the Apache (acute physiology and chronic health evaluation) system used in critical care in Australia.^2,3,11-13 Because these severity of illness measures do not account for some of the variance in length of hospital stay and costs not explained by DRGs, alternative adjustments have been considered, including functional status indexes (particularly those measuring degree of independence in activities of daily living).¹⁴
An accurate method of measuring illness severity within AN-DRGs is yet to be developed. Thus, further work is required to identify whether nursing acuity or therapeutic nursing interventions can be used as surrogate indicators of illness severity. This may be the challenge for casemix and nursing in the future.
Quality and outcomes
The third challenge for nurses -- quality and the establishment of professionally agreed-upon clinical outcomes -- also presents a challenge to other health professionals. Casemix was originally intended to provide a method of more accurately defining and measuring outcomes within homogeneous groups. DRGs have enhanced the ability to map an episode of care for a group of patients, resulting in a proliferation of clinical pathways or care maps. Nurses have been key players in the development and implementation of these tools.¹⁵ Clinical pathways or care maps have been effective in streamlining care and in resource utilisation, and they have improved hospital processes and reduced lengths of stay.¹⁶
However, most clinical pathways or care maps fall short in defining and measuring outcomes of episodes of care within an AN-DRG. The same applies to guidelines and clinical protocols. The challenge for nurses is to identify the outcomes that measure the contribution that nursing makes to the episode of care. They need to work with the multidisciplinary team to develop measurable and realistic outcome goals that reflect the efficacy of treatment and the quality of the care given within DRGs. Nurses need to be able to demonstrate the impact of their care on the cost and length of stay of each DRG in order to maintain adequate funding for the nursing component of a DRG.
Impact on clinical practice
The final issue relates to changes in clinical practice and adapting AN-DRGs, nursing resources and nursing classifications to these changes. Early discharge programs and coordinated care programs for chronically ill people encourage management in the community rather than hospital admission. Casemix funding systems in some States have acted as a disincentive to these hospital-in-the-home initiatives, when DRG funding has been allocated only for hospital stay. A more creative way of determining what constitutes a "hospital bed" needs to be considered, to ensure that these programs are adequately funded.
Outcome measures must be developed to determine whether these community-based programs are effective and whether they are accurately costed. In many cases, the nurses who manage hospital-in-the-home patients take on a range of roles, including education of carers, counselling and social work activities. In view of these additional roles, a system of measuring the nursing requirements and costs of home care needs to be considered. This should be compatible with hospital nursing classification and costing systems to enable accurate tracking of costs, outcomes and acuity across a full episode of care within a DRG.
References

Diers D. Whoa!!. Aust Nurses J 1991; June 20(10): 8-9.
Ballard KA, Gray RF, Knauf RA, Uppal P. Measuring variations in nursing care per DRG. Nurs Manage 1993; 24(4): 33-41.
Phillips CY, Castorr A, Prescott PA, Soeken K. Nursing intensity: going beyond patient classification. J Nurs Adm 1992; 22: 46-52.
The Severity Measurement Protocol. Report to the Clinical Advisory Committee, South Australian Health Commission, 1994.
Sharkey PD, Horn SD, Brigham PA. Classifying patients with burns for hospital reimbursement: diagnosis-related groups and modifications for severity. J Burn Care Rehabil 1991; 12: 319-329.
Horn SD, Sharkey PD, Buckle JM, Backhofen JE, et al. The relationship between severity of illness and hospital length of stay and mortality. Med Care 1991; 29: 210-220.
Rapoport J, Teres D, Lemeshow S, Avrunin JS, et al. Explaining variability of cost using a severity-of-illness measure for ICU patients. Med Care 1990; 28: 338-348.
South Australian Health Commission. Severity and cost differentiation. Discussion Paper. Adelaide: SA Health Commission, 1998.
Marshall R, Zhang X, Lonergan J. Measures of disease severity in the AN-DRG classification: the case for CC severity level indicators. Proceedings of the Seventh Casemix Conference in Australia; 1995; Jul 31-Aug 2; Adelaide. Canberra: Commonwealth Department of Human Services and Health, 1995.
Bostrom J, Mitchell M. Relationship of direct nursing care hours to DRG and severity of illness. Nurs Econom 1991; 9: 105-110.
Prescott P. Nursing intensity: needed today for more than staffing. Nurs Econom 1991; 9: 409-414.
Adams T. Case Mix Index: nursing's new management tool. Nurs Manage 1996; 27(9): 31.
McKinley S. Casemix update: Australian critical care costs and service weights. Part 2. Aust Crit Care 1996; 9(2): 56-59.
Kelleher C. Validated indexes: key to nursing acuity standardization. Nurs Econom 1992; 10: 36.
Zander K. Physicians, care maps and collaboration. The new definition. Boston, Mass: Centre for Case Management, 1992; 7(1): 2-4.
Ferguson L. Casemix issues for nursing. Med J Aust 1994; 161 Suppl Sep 5: S37-S39.

Authors' details
Royal Adelaide Hospital, Adelaide, SA.
Lesley E Long, RGN, BAppSci(Nsg), PhD, MHA Nursing Director, Cancer Centre.
Rosemary Mann, RGN, BA, GradDipOrthoNsg, Project Nurse, Nursing Administration.
Reprints will not be available from the authors.
Correspondence: Dr L E Long, Nursing Administration, Royal Adelaide Hospital, North Terrace, Adelaide, SA 5000.
E-mail: llongATcancer.rah.sa.gov.au

Go to the next article . . .
Readers may print a single copy for personal use. No further reproduction or distribution of the articles should proceed without the permission of the publisher. For permission, contact the Australasian Medical Publishing Company.
Journalists are welcome to write news stories based on what they read here, but should acknowledge their source as "an article published on the Internet by The Medical Journal of Australia <http://www.mja.com.au>".
<URL: http://www.mja.com.au/> © 1998 Medical Journal of Australia.

Synopsis
	An Australia-wide patient classification system for nursing is urgently needed as the health system attempts to develop benchmarks against which to measure and compare services. Standardised measures of demand for nursing care must be developed to allow appropriate reimbursement and to act as proxies for illness severity. Nurses need to identify the outcomes that measure the nursing contribution to episodes of care, and assist in developing outcome goals reflecting the efficacy of treatment and the quality of care. A system of measuring nursing requirements and costs of early discharge and coordinated care programs is required. It must be consistent with nursing classifications and hospital costing systems.
Introduction
	Casemix continues to present challenges to the nursing profession. Initially, the focus was on refining the Australian AN-DRG classification to more accurately reflect clinical practice and, although anomalies still exist, this has largely been accomplished. Currently, four issues pose a particular challenge to nursing and relate to integrating the AN-DRG classification with: An Australian patient classification system for nursing; Measures of illness severity within DRGs; Measures of the nursing contribution to quality and outcomes; and, Measures of nursing requirements and costs of home-based and coordinated care programs.
A patient classification system for nursing
	Because patients within a DRG are not necessarily alike in terms of cost and nursing dependency, there is a need for a patient classification system for nursing.¹ This has become more urgent as the healthcare system attempts to develop benchmarks against which to measure and compare services. At present, each State and Territory has a very different system of patient classification for nursing acuity, which means that nursing content, reliability, validity and clinical meaning within AN-DRGs cannot be compared across Australia. There have been problems reaching a consensus on nursing classification issues. If nursing does not understand (and agree on) its own cost structure, or its contribution to the costs of patient care, it cannot hope to negotiate prices for the nursing component of an episode of care.² A comparison of three nursing classification systems used in New York State found that estimates of nursing costs and nursing intensity (resource requirement and complexity of nursing care) varied because each system measured resource use differently.³ In South Australia, information is now available on nursing hours per patient-day and costs per patient-day. In 1995, a computer-based clinical decision-making program was successfully integrated with a computer-based nurse scheduling program. This system has been used in the major metropolitan hospitals and in a small number of larger country hospitals. Data collected can be aggregated to AN-DRGs and nursing costs compared across South Australian hospitals. Information from this system was used in the initial nurse costing study to develop the first nursing service weights incorporated into AN-DRGs. This system lends itself to continual refinement and innovation. Consensus about Australian nursing costs and what constitutes nursing in Australia cannot be reached, and benchmarks cannot be developed, until the nursing profession develops a patient classification system for nursing which applies to the whole of Australia.
Illness severity measures
	The second issue challenging nursing -- measurement of illness severity in terms of nursing dependency -- is directly related to patient classification. Resource use within DRGs varies, as many AN-DRGs are far from homogeneous. Studies have shown that resource use within DRGs can be influenced by a range of factors including illness severity, disease complexity and comorbidities, as well as the socioeconomic profile of the patient.^4-7 The South Australian Department of Human Services deals with the issue of case complexity and severity by giving its metropolitan teaching hospitals and regional country hospitals a severity loading. This severity index is calculated on the basis of the number of diagnosis and procedure codes per patient record by AN-DRG, and takes into account length of stay factors and variations in patient acuity and complexity.⁸ Variables of illness severity have been considered in AN-DRG-3. These include age, specific complications and comorbidities, level of effect of complications and comorbidities, complicating effects of interactions between groups of complications and comorbidities, direct clinical and physiological observations, need for life-support or therapeutic interventions, and admission status.⁹ AN-DRG-3 addresses some illness severity issues by the inclusion of splits based on three complicating clinical factors (CCFs): complication and comorbidity levels, age, and the presence of malignancy. Studies of illness severity and nursing have concentrated on developing standardised measures of demand for nursing care to allow appropriate reimbursement and to more accurately reflect nursing acuity. A study of the relationship between nursing care hours to DRGs and illness severity found that the demand for nursing resources was associated with illness severity, and that classification of patients by DRG and illness severity produced more homogeneous groups in terms of nursing resources.¹⁰ As nursing constitutes such a large proportion of the total expenditure for an episode of care, several tools have been developed to measure the impact of illness severity on nursing care. These include the Patient Intensity for Nursing Index (PINI), Nursing Intensity Weights (NIWs) and Case Mix Index (CMI), which are used across a range of medical and surgical DRGs in the United States, and the Apache (acute physiology and chronic health evaluation) system used in critical care in Australia.^2,3,11-13 Because these severity of illness measures do not account for some of the variance in length of hospital stay and costs not explained by DRGs, alternative adjustments have been considered, including functional status indexes (particularly those measuring degree of independence in activities of daily living).¹⁴ An accurate method of measuring illness severity within AN-DRGs is yet to be developed. Thus, further work is required to identify whether nursing acuity or therapeutic nursing interventions can be used as surrogate indicators of illness severity. This may be the challenge for casemix and nursing in the future.
Quality and outcomes
	The third challenge for nurses -- quality and the establishment of professionally agreed-upon clinical outcomes -- also presents a challenge to other health professionals. Casemix was originally intended to provide a method of more accurately defining and measuring outcomes within homogeneous groups. DRGs have enhanced the ability to map an episode of care for a group of patients, resulting in a proliferation of clinical pathways or care maps. Nurses have been key players in the development and implementation of these tools.¹⁵ Clinical pathways or care maps have been effective in streamlining care and in resource utilisation, and they have improved hospital processes and reduced lengths of stay.¹⁶ However, most clinical pathways or care maps fall short in defining and measuring outcomes of episodes of care within an AN-DRG. The same applies to guidelines and clinical protocols. The challenge for nurses is to identify the outcomes that measure the contribution that nursing makes to the episode of care. They need to work with the multidisciplinary team to develop measurable and realistic outcome goals that reflect the efficacy of treatment and the quality of the care given within DRGs. Nurses need to be able to demonstrate the impact of their care on the cost and length of stay of each DRG in order to maintain adequate funding for the nursing component of a DRG.
Impact on clinical practice
	The final issue relates to changes in clinical practice and adapting AN-DRGs, nursing resources and nursing classifications to these changes. Early discharge programs and coordinated care programs for chronically ill people encourage management in the community rather than hospital admission. Casemix funding systems in some States have acted as a disincentive to these hospital-in-the-home initiatives, when DRG funding has been allocated only for hospital stay. A more creative way of determining what constitutes a "hospital bed" needs to be considered, to ensure that these programs are adequately funded. Outcome measures must be developed to determine whether these community-based programs are effective and whether they are accurately costed. In many cases, the nurses who manage hospital-in-the-home patients take on a range of roles, including education of carers, counselling and social work activities. In view of these additional roles, a system of measuring the nursing requirements and costs of home care needs to be considered. This should be compatible with hospital nursing classification and costing systems to enable accurate tracking of costs, outcomes and acuity across a full episode of care within a DRG.
References
	Diers D. Whoa!!. Aust Nurses J 1991; June 20(10): 8-9. Ballard KA, Gray RF, Knauf RA, Uppal P. Measuring variations in nursing care per DRG. Nurs Manage 1993; 24(4): 33-41. Phillips CY, Castorr A, Prescott PA, Soeken K. Nursing intensity: going beyond patient classification. J Nurs Adm 1992; 22: 46-52. The Severity Measurement Protocol. Report to the Clinical Advisory Committee, South Australian Health Commission, 1994. Sharkey PD, Horn SD, Brigham PA. Classifying patients with burns for hospital reimbursement: diagnosis-related groups and modifications for severity. J Burn Care Rehabil 1991; 12: 319-329. Horn SD, Sharkey PD, Buckle JM, Backhofen JE, et al. The relationship between severity of illness and hospital length of stay and mortality. Med Care 1991; 29: 210-220. Rapoport J, Teres D, Lemeshow S, Avrunin JS, et al. Explaining variability of cost using a severity-of-illness measure for ICU patients. Med Care 1990; 28: 338-348. South Australian Health Commission. Severity and cost differentiation. Discussion Paper. Adelaide: SA Health Commission, 1998. Marshall R, Zhang X, Lonergan J. Measures of disease severity in the AN-DRG classification: the case for CC severity level indicators. Proceedings of the Seventh Casemix Conference in Australia; 1995; Jul 31-Aug 2; Adelaide. Canberra: Commonwealth Department of Human Services and Health, 1995. Bostrom J, Mitchell M. Relationship of direct nursing care hours to DRG and severity of illness. Nurs Econom 1991; 9: 105-110. Prescott P. Nursing intensity: needed today for more than staffing. Nurs Econom 1991; 9: 409-414. Adams T. Case Mix Index: nursing's new management tool. Nurs Manage 1996; 27(9): 31. McKinley S. Casemix update: Australian critical care costs and service weights. Part 2. Aust Crit Care 1996; 9(2): 56-59. Kelleher C. Validated indexes: key to nursing acuity standardization. Nurs Econom 1992; 10: 36. Zander K. Physicians, care maps and collaboration. The new definition. Boston, Mass: Centre for Case Management, 1992; 7(1): 2-4. Ferguson L. Casemix issues for nursing. Med J Aust 1994; 161 Suppl Sep 5: S37-S39.
Authors' details
	Royal Adelaide Hospital, Adelaide, SA. Lesley E Long, RGN, BAppSci(Nsg), PhD, MHA Nursing Director, Cancer Centre. Rosemary Mann, RGN, BA, GradDipOrthoNsg, Project Nurse, Nursing Administration. Reprints will not be available from the authors. Correspondence: Dr L E Long, Nursing Administration, Royal Adelaide Hospital, North Terrace, Adelaide, SA 5000. E-mail: llongATcancer.rah.sa.gov.au

	Go to the next article . . . Readers may print a single copy for personal use. No further reproduction or distribution of the articles should proceed without the permission of the publisher. For permission, contact the Australasian Medical Publishing Company. Journalists are welcome to write news stories based on what they read here, but should acknowledge their source as "an article published on the Internet by The Medical Journal of Australia <http://www.mja.com.au>". <URL: http://www.mja.com.au/> © 1998 Medical Journal of Australia.