Generating Revenue from a Inpatient Psychiatric Unit

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Dec 20, 2001
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Obviously, making profit is not the primary objective in having an inpatient psych service, but compared to others specialties, inpatient psych can be a drain on a hospital.

Any thoughts on how inpatient psychiatric units at community hospitals remain profitable or simply generate enough revenue to stay afloat, especially in isolated areas of the country?


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7+ Year Member
Feb 7, 2007
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My own impression is that a few principles can make a psych unit profitable (or at least less of a drain).
1) MD assessments, notes, dx's, treatments, and treatment plans must demonstrate, every day, the exact reasons that a patient MUST be behind locked doors TODAY. This is imperative, and docs MUST learn how to do it - or there will be no unit.
2) Provide all the ancillary services possible. With proper documentation, OT, RT, Art Therapy can all provide enormous help to the unit and can BILL for those services.
3) Hosp's have to get a little creative about how to get patients OUT once they no longer absolutely require inpt care. D/C plans really must start on day 1. It can't be acceptable for pt's to stay in the hosp because the family doesn't have a ride to come pick him up today.
4) We can only accept pt's who require acute inpatient psych care. Psych units have to stop accepting pts for the purpose of housing. We will have to push back against the agencies required to provide emergency housing service for the disabled (Adult Protective Service) and refuse such pt's, calling APS to report that the pt has been discharged from the ED and they need to come see the pt. These are tough times for everyone, but we won't be treating anyone if we don't keep the doors open.

Thanks for letting me vent today.


Slow Wave Smurf
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May 24, 2006
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Kugel said it all....

if you can keep the average length of stay in the unit below 5 days, you'll be okay.. Don't expect insurance to pay for more than that. If they really really need longer stay (as in seriously not somewhat dangerous to themselves or others) then transfer to state hospitals. Otherwise, discharge to some shelter with outpatient therapy (partial hospitalization programs, Contract/Pact teams, out patient follow-up, whatever it takes).


All In at the wrong time
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Dec 22, 2007
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Please explain why this is, if possible. Thank you.

Most of the patients on geripsych units have medicare, as opposed to a regular psych unit were many have medicaid or no insurance.

Also, most pts on geripsych units have a "medical" dx such as Alzhemeirs rather than a psychiatric dx such as depression, leading to better reimbursement.


Former jolly good fellow
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Feb 8, 2004
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Any thoughts on how inpatient psychiatric units at community hospitals remain profitable or simply generate enough revenue to stay afloat, especially in isolated areas of the country?

The place I graduated from was profitable.


You had a nurse manager that was on top of the situations. She saw a malingerer, she got the staff & attendings to get on top of it & get that malingerer kicked out. She was on top of it more than several of the attendings.

When I was a resident there, I didn't mind it because she knew what was going on with those patients. If a new attending came there who wanted didn't know the patient, and that patient was seen by that unit over a dozen times & was a known malingerer-she'd put pressure to get the patient kicked out.

One of the attendings kept an easy to obtain record of all the patients under his service on his PDA & wrote the "important" stuff that summed it all up in an easy manner--like if the patient was one of those types that just really needed to be there for 1 day because they really just had adjustment DO & liked to go to the hospital for a tune up. You saw some of those patients again & again & again, and he knew exactly how to handle it from the first moment.

Then you had another attending that didn't keep track, didn't even read the old discharge summaries on his own patients & when they came back it was as if everything was being done from scratch.

Of course its not all about the $$$, but when you're not on top of stuff like this, it takes several days longer to figure out what's going on & to get the patient the right treatment. It wastes money & ends up making the place not as profitable.

Politics though were sometimes wierd as a resident. I've sat through sessions where the latter attending pretty much sat on his butt, while the nurse manager wanted the patient out & put pressure on me to do so--even though I'm supposed to listen to the attending, not the nurse manager.
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