Uncovering waste in US healthcare: Evidence from ambulance referral patterns

Assessing the quality of public services: For-profits, chains, and concentration in the hospital market

We examine variation in US hospital quality across ownership, chain membership, and market concentration. We propose a new measure of quality derived from penalties imposed on hospitals under the flagship Hospital Readmissions Reduction Program, and use regression models to risk-adjust for hospital characteristics and county demographics. While the overall association between for-profit ownership and quality is negative, there is evidence of substantial heterogeneity. The quality of for-profit relative to non-profit hospitals declines with increasing market concentration. Moreover, the quality gap is primarily driven by for-profit chains. While the competition result mirrors earlier findings in the literature, the chain result appears to be new: it suggests that any potential quality gains afforded by chains are mostly realized by not-for-profit hospitals.

Medicare Advantage growth and skilled nursing facility finances

OBJECTIVE

To examine the relationship between growth in Medicare Advantage (MA) enrollment and changes in finances at skilled nursing facilities (SNFs).

DATA SOURCES

Medicare SNF cost reports, LTCFocus.org data, and county MA penetration rates.

STUDY DESIGN

We used ordinary least squares regression with SNF and year fixed effects. Our primary outcomes were SNF revenues, expenses, profits, and occupancy. Our primary independent variable was the yearly county Medicare Advantage penetration.

DATA COLLECTION/EXTRACTION

We linked facility-year data from 2012 to 2019 obtained from cost reports and LTCFocus.org to county-year MA penetration.

PRINCIPAL FINDINGS

A 10 percentage point increase in county MA enrollment was associated with a $213,883.89 (95% Confidence Interval [CI]: -296,869.08, -130,898.71) decrease in revenue, a $132,456.19 (95% CI: -203,852.28, -61,060.10) decrease in expenses, and a 0.59 percentage point (95% CI: -0.97, -0.21) decrease in profit margin. A 10 percentage point increase in county MA enrollment was associated with a decline (-318.93; 95% CI: -468.84, -169.02) in the number of resident-days (a measure of occupancy) as well as a decline in the revenue per resident day ($4.50; 95% CI: -6.81, -2.20), potentially because of lower prices in MA. There was also a decline in expenses per patient day (-2.35; 95% CI: -4.76, 0.05), though this was only statistically significant at the 10% level. While increased MA enrollment was associated with a substantial decline in the number of Medicare resident days (487.53; 95% CI: -588.70, -386.37), this was partially offset by an increase in other payer (e.g., private pay) resident days (285.91; 95% CI: 128.18, 443.63). Increased MA enrollment was not associated with changes in the number of Medicaid resident days or a decrease in staffing per resident day.

CONCLUSION

SNFs in counties with more MA growth had substantially greater relative declines in revenue, expenses, and profit margins. The continued growth of MA may result in significant changes in the SNF industry.

The unexpected costs of expertise: evidence from highly specialized physicians

High U.S. spending on health care is commonly attributed to its intensity of specialized, high-tech medical care. A growing body of research focuses on physicians whose medical decisions shape treatment intensity, costs, and patient outcomes. Often overlooked in this research is the assignment of physician skills to patient conditions, which may strongly affect health outcomes and productivity. This matching may be especially important in the case of hospital admissions as high-frequency fluctuations in patient flow make it challenging to maintain effective matches between the best-suited physicians and their patients. This paper focuses on hospitals' responses to demand shocks induced by unscheduled high-risk admissions. I show that these demand shocks result in physician-patient mismatches when hospitals are congested. Specifically, highly specialized physicians who are brought in to treat unscheduled high-risk admissions also treat previously admitted lower-risk patients. This leads to increased treatment intensity for lower-risk patients, which I attribute to persistence in physician practice style. Despite the greater treatment intensity, I find no detectable improvement in health outcomes, which prima facie could be viewed as waste. However, this paper demonstrates that such mismatches mostly happen when the cost of maintaining preferred physician-patient matching is high, which reflects hospitals' conscientious assessment of costs and benefits and should not be simply interpreted as inefficiency. These findings provide vital information for policy-makers looking to identify waste in utilization and create incentives to enhance efficiency in the health care sector.

Geographical Variations In Emergency Department Visits For Mental Health Conditions For Medicaid Beneficiaries

Despite Medicaid's importance as a payer and source of coverage for mental health care, relatively little is known about how prevalence, access, and quality might vary among Medicaid beneficiaries. This study used national Medicaid data from 2018 to assess regional variations in emergency department (ED) visits for mental health conditions, a measure that may reflect unmet needs for behavioral health care. We found substantial variations, with rates in the region with the highest visit rates eight times higher than those in the region with the lowest rates. Many regions with high rates of ED visits for mental health conditions also had high rates of outpatient mental health use. Regional patterns differed substantially, with some regions exhibiting high rates of ED visits related to anxiety but low rates for schizophrenia and vice versa. The presence of large variations in ED visits for mental health conditions, with substantial differences in the composition across regions, suggests a need for context-specific solutions, including assessments of the ways in which mental health benefits are structured at the state Medicaid agency level and of differences in provider accessibility and an understanding of the types of mental illness underlying high rates of use.

The marginal benefit of hospitals: Evidence from the effect of entry and exit on utilization and mortality rates

Whether policies that change health care consumption affect health depends on the marginal benefit of the affected health care. I use variation in access to hospitals caused by nearly 1,300 hospital entries and exits to show that hospital entries cause sharp increases and exits cause sharp decreases in the quantity of inpatient care and emergency department visits with no short-term effect on the mortality rate. Thus, preventing hospital exit is not a cost effective way to save lives on average. However, exits of some hospitals with larger impacts on access to care increase the mortality rate and produce lower cost per life saved estimates.

Do subsidized nursing homes and home care teams reduce hospital bed-blocking? Evidence from Portugal

Excessive length of hospital stay is among the leading sources of inefficiency in healthcare. When a patient is clinically fit to be discharged but requires support outside the hospital, which is not readily available, they remain hospitalized until a safe discharge is possible -a phenomenon called bed-blocking. I study whether the availability of subsidized nursing homes and home care teams reduces hospital bed-blocking. Using individual data on the universe of inpatient admissions at Portuguese hospitals during 2000-2015, I find that the entry of home care teams in a region reduces bed-blocking by 4 days per episode, on average. Nursing home entry only reduces bed-blocking among patients with high care needs or when the intensity of entry is high. Reductions in bed-blocking do not harm patients' health. The beds freed up by reducing bed-blocking are used to admit additional elective patients.

On the brink of disruption: Applying Resilience Engineering to anticipate system performance under crisis

As COVID-19 spread across Brazil, it quickly reached remote regions including Amazon's ultra-peripheral locations where patient transportation through rivers is added to the list of obstacles to overcome. This article analyses the pandemic's effects in the access of riverine communities to the prehospital emergency healthcare system in the Brazilian Upper Amazon River region. To do so, we present two studies that by using a Resilience Engineering approach aimed to predict the functioning of the Brazilian Mobile Emergency Medical Service (SAMU) for riverside and coastal areas during the COVID-19 pandemic, based on the normal system functioning. Study I, carried out before the pandemic, applied ethnographic methods for data collection and the Functional Resonance Analysis Method - FRAM for data analysis in order to develop a model of the mobile emergency care in the region during typical conditions of operation. Study II then estimated how changes in variability dynamics would alter system functioning during the pandemic, arriving at three trends that could lead the service to collapse. Finally, the accuracy of predictions is discussed after the pandemic first peaked in the region. Findings reveal that relatively small changes in variability dynamics can deliver strong implications to operating care and safety of expeditions aboard water ambulances. Also, important elements that add to the resilient capabilities of the system are extra-organizational, and thus during the pandemic safety became jeopardized as informal support networks grew fragile. Using FRAM for modelling regular operation enabled prospective scenario analysis that accurately predicted disruptions in providing emergency care to riverine population.

Payment schemes and treatment responses after a demand shock in mental health care

We study whether two groups of mental health care providers-each paid according to a different payment scheme-adjusted the duration of their patients' treatments after they faced an exogenous 20% drop in the number of patients. For the first group of providers, self-employed providers, we find that they did not increase treatment duration to recoup their income loss. Treatment duration thresholds in the stepwise fee-for-service payment function seem to have prevented these providers to treat patients longer. For the second group of providers, large mental health care institutions who were subject to a budget constraint, we find an average increase in treatment duration of 8%. Prior rationing combined with professional uncertainty can explain this increase. We find suggestive evidence for overtreatment of patients as the longer treatments did not result in better patient outcomes, i.e. better General Assessment of Functioning scores.

Neighborhoods, networks, and delivery methods

We examine the contribution of information transmission among pregnant women to geographic variation in C-sections in Lombardy, Italy. Defining networks as pregnant women living in the same municipality, we observe that if the incidence of C-sections within the womans network is one standard deviation higher over the 12 months preceding delivery, then her probability of delivering by C-section is 0.007 percentage points (3%) higher. This result is mainly a network effect on Italian women, while it arises from both network and neighborhood effects on foreign women. Both groups respond to additional information, such as the incidence of C-section complications. The selection of pregnant women across hospitals does not uniquely explain our results, which are robust to alternative sample selections and specifications.

Nursing Home Profit Margins and Citations for Infection Prevention and Control

OBJECTIVES

Recent rampant spread of COVID-19 cases in nursing homes has highlighted the concerns around nursing homes' ability to contain the spread of infections. The ability of nursing homes to invest in quality improvement initiatives may depend on resource availability. In this study, we sought to examine whether lower profit margins, as a proxy for lack of resources, are associated with persistent infection control citations.

DESIGN

We conducted a retrospective study.

SETTING AND PARTICIPANTS

Medicare-certified nursing homes in the US with financial and facility characteristics data (n = 12,194).

METHODS

We combined facility-level data on nursing home profit margins from Medicare Cost Reports with deficiency citation data from Nursing Home Compare (2017-2019) and facility characteristics data from LTCFocus.org. We descriptively analyzed infection control citations by profit margins quintiles. We used logistic regressions to examine the relationship between profit margin quintiles and citations for infection prevention and control, adjusting for facility and market characteristics.

RESULTS

About three-fourths of all facilities received deficiency citations for infection prevention and control during 1 or more years from 2017 to 2019 with about 10% of facilities cited in all 3 years. Facilities in the highest profit margin quintile had 7.6% of facilities with citations for infection prevention and control in each of the 3 years compared with 8.1%, 10.0%, 10.7%, and 13.7% for facilities in the fourth, third, second, and first quintiles of profit margins, respectively. Multivariable regressions showed that facilities with the lowest profit margins (first quintile) had 54.3% higher odds of being cited in at least 1 year and 87.6% higher odds of being cited in each of the 3 years compared with facilities with the highest profit margins (fifth quintile).

CONCLUSIONS AND IMPLICATIONS

Our findings indicate that nursing homes may need more resources to prevent citations for infection prevention and control.

Characteristics and Outcomes of Pediatric Nonindex Readmission: Evidence From Florida Hospitals

OBJECTIVES

Increasing pediatric care regionalization may inadvertently fragment care if children are readmitted to a different (nonindex) hospital rather than the discharge (index) hospital. Therefore, this study aimed to assess trends in pediatric nonindex readmission rates, examine the risk factors, and determine if this destination difference affects readmission outcomes.

METHODS

In this retrospective cohort study, we use the Healthcare Cost and Utilization Project State Inpatient Database to include pediatric (0 to 18 years) admissions from 2010 to 2017 across Florida hospitals. Risk factors of nonindex readmissions were identified by using logistic regression analyses. The differences in outcomes between index versus nonindex readmissions were compared for in-hospital mortality, morbidity, hospital cost, length of stay, against medical advice discharges, and subsequent hospital visits by using generalized linear regression models.

RESULTS

Among 41 107 total identified readmissions, 5585 (13.6%) were readmitted to nonindex hospitals. Adjusted nonindex readmission rate increased from 13.3% in 2010% to 15.4% in 2017. Patients in the nonindex readmissions group were more likely to be adolescents, live in poor neighborhoods, have higher comorbidity scores, travel longer distances, and be discharged at the postacute facility. After risk adjusting, no difference in in-hospital mortality was found, but morbidity was 13% higher, and following unplanned emergency department visits were 28% higher among patients with nonindex readmissions. Length of stay, hospital costs, and against medical advice discharges were also significantly higher for nonindex readmissions.

CONCLUSIONS

A substantial proportion of children experienced nonindex readmissions and relatively poorer health outcomes compared with index readmission. Targeted strategies for improving continuity of care are necessary to improve readmission outcomes.

The impact of certificate of need laws on heart attack mortality: Evidence from county borders

Certificate of need (CON) regulations requires that health care providers obtain state approval before offering a new service or expanding existing facilities. The purported goal of CON regulations is to reduce health care costs by generating regional economies of scale and reducing redundant investments resulting from excessive competition. Critics of CON regulations note that the regulatory environment increases the costs of expansion and may incentivize health care providers to forgo capital investment, which can have a negative effect on health outcomes. To estimate the net effect of CON regulations, I use a border discontinuity design to measure within-regional heart attack mortality spanning 1968 to 1982. I estimate that CON regulations led to an increase in heart attack deaths, by 6%-10%, three years after the policy was enacted.

Medicare's Hospital Value-Based Purchasing Program Values Quality over QALYs

Medicare's Hospital Value-Based Purchasing Program (HVBP) is the first national pay-for-performance program to combine measures of quality of care with a measure of episode spending. We estimated the implicit tradeoffs between mortality reduction and spending reduction. To earn points in HVBP, a hospital can either lower mortality or reduce spending, creating a tradeoff between the 2 measures. We analyzed the quality performance and earned points of 2814 hospitals using publicly available data. We then quantified the tradeoffs between spending and mortality in terms of quality-adjusted life-years (QALYs). If incentives in the program were balanced, then the tradeoff between spending and QALYs should be comparable with those of high-value health interventions, roughly $50,000 to $200,000 per QALY. Instead, the tradeoff in HVBP was about $1.2 million per QALY. HVBP overvalues improvements in quality of care relative to spending reductions. We propose 2 possible policy adjustments that could improve incentives for hospitals to deliver high-value care.

Evolution of the home health care market: The expansion and quality performance of multi-agency chains

OBJECTIVE

To examine the growth and evolution of the home health agency (HHA) market and to compare quality performance across HHA ownership categories.

DATA SOURCE

Agency characteristics were extracted from Medicare cost reports and Provider of Services file. Quality of care and patient characteristics were extracted from Quality of Patient Care Star Ratings and HHA Public Use File.

STUDY DESIGN

Agency- and state-level analyses were conducted to describe HHA market trends. Patient characteristics and quality measures were compared across ownership categories of interest.

DATA COLLECTION/EXTRACTION METHODS

All Medicare-certified HHAs in operation, 2005-2018.

PRINCIPAL FINDINGS

Over the study period, the HHA sector grew substantially, increasing from 7899 to 10 818 agencies, and chain-owned HHAs doubled in number from 903 (11.4% of all agencies) to 1841 (17.0%). In 2018, across agency types, for-profit nonchain agencies were the largest category both in the number of agencies (67.8%) and the number of Medicare enrollees served (40.7%). Additionally, for-profit nonchain agencies grew most in total number, from 4293 (54.3%) to 7337 (67.8%), while for-profit chain agencies grew most in the number of Medicare enrollees served, from 439 998 (12.9%) to 1 082 385 (28.3%). Regarding patient composition, for-profit nonchain agencies served the highest proportion of dual eligible beneficiaries (42.2%) and African-Americans (27.9%) among all agency types. Regarding quality performance, a higher star rating is significantly (P < .01) associated with chain agency status. Moreover, chain HHAs performed better on self-reported process measures, and risk-adjusted self-reported outcome measures; however, they performed worse on risk-adjusted claims-based outcome measures. These results were similar across for-profit and nonprofit chain agencies.

CONCLUSION

Chains play a growing role in the home health sector. Substantial differences in geographic distribution, patient composition, and quality performance were observed between chain- and nonchain HHAs. Examining the growth and performance of multi-agency chains can help inform quality reporting and monitoring, assess payment adequacy, and facilitate greater transparency and accountability within the HHA marketplace.

The impact of high intensity care around birth on long-term neurodevelopmental outcomes

BACKGROUND

An equitable and affordable healthcare system requires a constant search for the optimal way to deliver increasingly expensive neonatal care. Therefore, evaluating the impact of hospital intensity around birth on long-term health outcomes is necessary if we are to assess the value of high intensity neonatal care against its costs.

METHODS

This study exploits uneven geographical distribution of high intensity birth hospitals across Canada to generate comparisons across similar Cerebral Palsy (CP) related births treated at hospitals with different intensities. We employ a rich dataset from the Canadian Multi-Regional CP Registry (CCPR) and instrumental variables related to the mother's location of residence around birth.

RESULTS

We find that differences in hospitals' intensities are not associated with differences in clinically relevant, long-term CP health outcomes.

CONCLUSIONS

Our results suggest that existing matching mechanism of births to hospitals within large metropolitan areas could be improved by early detection of high risk births and subsequent referral of these births to high intensity birthing centers. Substantial hospitalization costs might be averted to Canadian healthcare system ($16 million with a 95% CI of $6,131,184 - $24,103,478) if CP related births were assigned to low intensity hospitals and subsequently transferred if necessary to high intensity hospitals.

The Relationship Between Reported Staffing and Expenditures in Nursing Homes

Dramatic improvements in reported nursing home quality, including staffing ratios, have come under increased scrutiny in recent years because they are based on data self-reported by nursing homes. In contrast to other domains, the key mechanism for real improvement in the staffing ratios domain is clearer: to improve scores, nursing homes should increase staffing expenditures. We analyze the relationship between changes in expenditures and reported staffing quality pre- versus post the 5-star rating system. Our results show that the relationship between expenditures and licensed practical nurse staffing is weaker in the post-5-star period, overall, and across subgroups; furthermore, there is a weaker relationship between expenditures and registered nurse staffing among for-profit facilities with a high share of Medicaid residents in the post-5-star period. The weaker relationship between staffing expenditures and staffing scores in the post-5-star era underscores the potential for gaming of the self-reported staffing scores and the need for more reliable sources.

Association Between Medicare Expenditure Growth and Mortality Rates in Patients With Acute Myocardial Infarction: A Comparison From 1999 Through 2014

Importance

Many studies have considered the association between Medicare spending and health outcomes at a point in time; few have considered the association between the long-term growth in spending and outcomes.

Objective

To assess whether components of growth in Medicare expenditures are associated with mortality rates between January 1, 1999, and June 30, 2014, for beneficiaries hospitalized for acute myocardial infarction.

Design, Setting, and Participants

Cross-sectional analysis of a random 20% sample of fee-for-service Medicare beneficiaries from January 1, 1999, through December 31, 2000 (n=72 473) and January 1, 2004, through December 31, 2004 (n=38 248), and 100% sample from January 1, 2008, through December 31, 2008 (n=159 558) and January 1, 2013, through June 30, 2014 (n=209 614) admitted with acute myocardial infarction to 1220 hospitals.

Main Outcomes and Measures

Primary exposure measures include the growth of 180-day expenditure components (eg, inpatient, physician, and postacute care) and early percutaneous coronary intervention by hospitals adjusted for price differences and inflation. The primary outcome is the risk-adjusted 180-day case fatality rate.

Results

Patients in each of the years 2004, 2008, and 2013-2014 (relative to those in 1999-2000) were qualitatively of equivalent age, less likely to be white or female, and more likely to be diabetic (all P < .001). Adjusted expenditures per patient increased 13.9% from January 1, 1999, through December 31, 2000, and January 1, 2013, through June 30, 2014, but declined 0.5% between 2008 and 2013-2014. Mean (SD) expenditures in the 5.0% of hospitals (n = 61) with the most rapid expenditure growth between 1999-2000 and 2013-2014 increased by 44.1% ($12 828 [$2315]); for the 5.0% of hospitals with the slowest expenditure growth (n = 61), mean expenditures decreased by 18.7% (-$7384 [$4141]; 95% CI, $8177-$6496). The growth in early percutaneous coronary intervention exhibited a negative association with 180-day case fatality. Spending on cardiac procedures was positively associated with 180-day mortality, while postacute care spending exhibited moderate cost-effectiveness ($455 000 per life saved after 180 days; 95% CI, $323 000-$833 000). Beyond spending on noncardiac procedures, growth in other components of spending was not associated with health improvements.

Conclusions and Relevance

Health improvements for patients with acute myocardial infarction varied across hospitals and were associated with the diffusion of cost-effective care, such as early percutaneous coronary intervention and, to a lesser extent, postacute care, rather than overall expenditure growth. Interventions designed to promote hospital adoption of cost-effective care could improve patient outcomes and, if accompanied by cuts in cost-ineffective care (inside and outside of the hospital setting), also reduce expenditures.

Did UberX reduce ambulance volume?

Ambulances are a vital part of emergency medical services. However, they come in single, high intervention form, which is at times unnecessary, resulting in excessive costs for patients and insurers. In this paper, we ask whether UberX's entry into a city caused substitution away from traditional ambulances for low-risk patients, reducing overall volume. Using a city-panel over-time and leverage that UberX enter markets sporadically over multiple years, we find that UberX entry reduced the per capita ambulance volume by at least 6.7%. Our result is robust to numerous specifications.

Intervention mechanism of healthcare service goods based on social welfare maximization in China

In this paper, we aim to establish a mathematical model to design a maximizing social welfare intervention mechanism of healthcare service goods in China. The intervention mechanism is helpful to facilitate the adoption of the healthcare service goods. We consider a research problem that regulates the supply chain system for healthcare service goods by an intervention mechanism, and two intervention strategies composed of demand-growth strategy and subsidy strategy are used to the combination of intervention mechanism. Then this paper presents a new method based on fuzzy set and bilevel programming to design the intervention mechanism. To demonstrate the effectiveness of the proposed model, we conduct a case study for Wudang personalized health package and verify our model by the specific result analysis, the result indicates that our joint intervention mechanism is helpful to achieve the target and increase social welfare.

Living Alone and Discharge to Skilled Nursing Facility Care after Hospitalization in Older Adults

BACKGROUND/OBJECTIVES

Community-based older adults are increasingly living alone. When they become ill, they might need greater support from the healthcare system than would those who live with others. There also has been a growing concern about the high use of postacute care such as skilled nursing facility (SNF) care and the level of variation in this use between hospitals and regions. Our objective was to examine whether living alone contributed to the risk of being discharged to a SNF.

DESIGN

Retrospective cohort study.

SETTING

Massachusetts General Hospital.

PARTICIPANTS

Community-dwelling individuals aged 50 and older admitted to the medical service and discharged alive between July 2014 and August 2015 (N = 7,029).

MEASUREMENTS

We extracted demographic, clinical, and functional data from the electronic medical record and used multivariable logistic regression to determine whether living alone at the time of hospitalization was associated with subsequent discharge to a SNF.

RESULTS

Of eligible individuals, 24.8% reported living alone before admission. Those living alone were more likely to be female, older, and more independent before admission than those living with others. Of all participants, 10.9% were discharged to a SNF. After adjustment, participants living alone had more than twice the odds of being discharged to a SNF (odds ratio = 2.23, 95% confidence interval = 1.85-2.69, P < .001).

DISCUSSION

People living alone are more likely to be discharged to SNFs, even when compared to other individuals with similar levels of clinical complexity and functional status. To the extent that this variation is due to a lack of home support, it could be possible to reduce SNF use through additional home services after hospital discharge.