Insurance Changes Lead to Discontinuation of ARU

FRANKLIN, IN - Movement away from acute rehabilitation services by health insurance plans has led Johnson Memorial Health to discontinue its Acute Rehabilitation Unit on the main hospital campus.

JMH President/CEO Larry Heydon said that changes in health insurance coverage provided by Medicare and other commercial plans have resulted in patients being redirected away from hospital-based rehabilitation services to other forms of care thus negatively impacting the average census at the unit over the past few years. 

Heydon said the decision to close the unit was strictly based on business factors as the nursing and therapy care provided has been excellent.

“We have not been able to sustain sufficient revenues to cover the costs of care for acute rehab patients,” Heydon said. “This put financial pressure on the overall organization in very difficult times with healthcare reform unfolding nationally.”

Heydon said the hospital staff worked on several initiatives to increase the number of patients using the acute rehab unit, and also implemented cost-saving measures.

“Unfortunately, the insurance companies have determined that their patients can be more affordably cared for in other settings such as nursing homes,” he added.

Johnson Memorial Health will continue to provide infusion services in another location of the hospital. Heydon said that he is pleased that all former ARU employees have secured positions either in other JMH departments or with other organizations.