The association between for-profit hospital ownership and increased Medicare spending

Understanding Factors Influencing Geographic Variation in Healthcare Expenditures: A Small Areas Analysis Study

Dramatic geographic variations in healthcare expenditures were documented by developed countries, but little is known about such variations under China's context, and what causes such variations. This study aims to examine variations of healthcare expenditures among small areas and to determine the associations between demand-, supply-factors, and per capita inpatient expenditures. This cross-sectional study utilized hospital discharge data aggregated within delineated hospital service areas (HSAs) using the small-area analysis approach. Linear multivariate regression modeling with robust standard errors was used to estimate the sources of variation of per capita inpatient expenditures across HSAs covering the years 2017 to 2019; the Shapley value decomposition method was used to measure the respective contributions of demand-, supply-side to such variations. Among 149 HSAs, demand factors explained most of the (87.4%) overall geographic variation among HSAs. With each 1% increase in GDP per capita and urbanization rate was associated with 0.099% and 0.9% increase in inpatient expenditure per capita, respectively, while each 1% increase in the share of females and the unemployment rate was associated with a 0.7% and 0.4% reduction in the per capita inpatient expenditures, respectively. In supply-side, for every 1 increase in hospital beds per 1000 population, the per capita inpatient expenditures rose by 2.9%, while with every 1% increase in the share of private hospitals, the per capita inpatient expenditures would decrease by 0.4%. With Herfindahl-Hirschman Index decrease 10%, the per capita inpatient expenditures would increase 1.06%. This study suggests demand-side factors are associated with large geographic variation in per capita inpatient expenditures among HSAs, while supply-side factors played an important role. The evaluation of geographic variations in per capita inpatient expenditures as well as its associated factors have great potential to provide an indirect approach to identify possibly existing underutilized or overutilized healthcare procedures.

The relationship between hospital ownership, in-hospital mortality, and medical expenses: an analysis of three common conditions in China

BACKGROUND

Private hospitals expanded rapidly in China since 2009 following its national health reform encouraging private investment in the hospital sector. Despite long-standing debates over the performance of different types of hospitals, empirical evidence under the context of developing countries remains scant. We investigated the disparities in health care quality and medical expenses among public, private not-for-profit, and private for-profit hospitals.

METHODS

A total of 64,171 inpatients (51,933 for pneumonia (PNA), 9,022 for heart failure (HF) and 3,216 for acute myocardial infarction (AMI)) who were admitted to 528 secondary hospitals in Sichuan province, China, during the fourth quarters of 2016, 2017, and 2018 were selected for this study. Multilevel logistic regressions and multilevel linear regressions were utilized to assess the relationship between hospital ownership types and in-hospital mortality, as well as medical expenses for PNA, HF, and AMI, after adjusting for relevant hospital and patient characteristics, respectively.

RESULTS

The private not-for-profit (adjusted OR, 1.69; 95% CI, 1.08, 2.64) and for-profit (adjusted OR, 1.67; 95% CI, 1.06, 2.62) hospitals showed higher in-hospital mortality than the public ones for PNA, but not for AMI and HF. No significant differences were found in medical expenses across hospital ownership types for AMI, but the private not-for-profit was associated with 9% higher medical expenses for treating HF, while private not-for-profit and for-profit hospitals were associated with 10% and 11% higher medical expenses for treating PNA than the public hospitals. No differences were found between the private not-for-profit and private for-profit hospitals both in in-hospital mortality and medical expenses across the three conditions.

CONCLUSION

The public hospitals had at least equal or even higher healthcare quality and lower medical expenses than the private ones in China, while private not-for-profit and for-profit hospitals had similar performances in these aspects. Our results added evidences on hospitals' performances among different ownership types under China's context, which has great potential to inform the optimization of healthcare systems implemented among developing countries confronted with similar challenges.

Quantifying For-Profit Outcomes in GME: A Multispecialty Analysis of Board Certifying Examination Pass Rates in For-Profit Affiliated Residency Programs

BACKGROUND

The number of for-profit hospitals has increased in the United States, but their role in and outcomes for graduate medical education (GME) are unclear.

OBJECTIVES

To describe for-profit involvement in internal medicine (IM), general surgery (GS), and pediatrics GME by quantifying change in for-profit affiliated residency programs and comparing for-profit and nonprofit affiliated program board certifying examination pass rates.

METHODS

We used Accreditation Council for Graduate Medical Education and Medicare data to quantify for-profit prevalence in IM, GS, and pediatrics GME from 2001 to 2021. We used public pass rate data from the American Board of Surgeons (2017-2019; n=242 programs; 6562 examinees), American Board of Internal Medicine (2018-2020; n=465 programs; 23 922 examinees), and American Board of Pediatrics (2018-2020; n=202 programs; 9819 examinees) to model the relationship between profit status and pass rate within each specialty and across specialties combined using linear regression.

RESULTS

The proportion of for-profit affiliated residency programs increased 400.0% in IM, 334.4% in GS, and 23.2% in pediatrics from 2001 to 2021. Bivariate linear regression revealed significantly lower pass rate in for-profit affiliated programs in IM β =-7.73, P<.001), pediatrics (β =-14.6, P<.001), and the 3 specialties combined (β =-5.45, P<.001). Upon multiple regression with addition of program characteristic covariates, this relationship remained significant in pediatrics (β =-10.04, P=.006).

CONCLUSIONS

The proportion of for-profit affiliated residency programs has increased in IM, GS, and pediatrics from 2001 to 2021. After controlling for covariates, for-profit affiliated programs were associated with lower board examination pass rates in pediatrics with no association in IM, GS, or the combined measure.

Creating accountable hospital service areas in China: a case analysis of health expenditure in the metropolis of Chengdu

OBJECTIVES

To delineate hospital service areas (HSAs) using the Dartmouth approach in China and identify the hypothesised demand-side, supply-side and region-specific factors of health expenditure within HSAs.

DESIGN

Population-based descriptive study.

SETTING

We selected the metropolis of Chengdu, one of the three most populous cities in China as a case for the analysis, where approximately 16.33 million residents living.

PARTICIPANTS

Individual-level in-patient discharge records (n=904 298) during the fourth quarter of 2018 (from 1 September to 31 December) were extracted from Sichuan Health Commission. Cases of non-residents of Chengdu were excluded from the datasets.

METHODS

We conducted three sets of analyses: (1) apply Dartmouth approach to delineate HSAs; (2) use Geographic Information System (GIS)-based method to demonstrate health expenditure variations across delineated HSAs and (3) employ a three-level multilevel linear model to examine the association between health expenditure and demand-side, supply-side and region-specific factors.

RESULTS

A total of 113 HSAs with a median population of 60 472 (ranging from 7022 to 827 750) was delineated. Total in-patient expenditure per admission varied more than threefold across HSAs after adjusting for age and gender. Apart from a list of demand-side factors, an increased number of physicians, healthcare facilities at higher levels and for-profit healthcare facilities were significantly associated with increased total in-patient expenditures. At the HSA level, the proportion of private healthcare facilities located in a single HSA was associated with increased total in-patient expenditure generated by that HSA, while the increased number of healthcare facilities in a HSA was negatively associated with the total in-patient expenditures.

CONCLUSION

HSAs were delineated to help establish an accountable healthcare delivery system, which serves as local hospital markets to provide in-patient healthcare via connecting demanders with suppliers inside particular HSAs. Policy-makers should adopt HSAs to identify variations of total in-patient expenditures among different areas and the potential associated factors. Findings from the HSA-based analysis could inform the formulation of relevant health policies and the optimisation of healthcare resource allocations.

Can Private Provision of Primary Care Contribute to the Spread of Antibiotic Resistance? A Study of Antibiotic Prescription in Sweden

BACKGROUND

Growing rates of antibiotic resistance, caused by increasing antibiotic use, pose a threat by making antibiotics less effective in treating infections.

OBJECTIVE

We aimed to study whether physicians working at privately and publicly owned health centres differed in the likelihood of prescribing antibiotics and choosing broad-spectrum over narrow-spectrum antibiotics.

METHODS

To estimate the effect of ownership on the probability of a prescribed drug being an antibiotic, we analysed all 4.5 million prescriptions issued from 2011 to 2015 at primary health centres in Västerbotten, Sweden. We controlled for patient age, sex, number of prescriptions per patient, and month of prescription, and used a maximum likelihood logit estimator. We then analysed how ownership affected the likelihood of a prescribed antibiotic being broad spectrum. We also used aggregated data to estimate the impact of the number of private health centres on the number of antibiotic prescriptions per inhabitant and the proportion of broad-spectrum antibiotics.

RESULTS

Holding other factors constant, private physicians were 6% more likely to prescribe antibiotics and 9% more likely to choose broad-spectrum antibiotics. An increase by one additional private health centre was positively associated with an increase in the number of antibiotic prescriptions per inhabitant and a higher proportion, although not significant, of broad-spectrum antibiotic prescriptions.

CONCLUSION

Our findings suggest that private physicians prescribe more antibiotics, especially broad-spectrum antibiotics, than public physicians. Therefore, it is crucial to provide health centres with incentives to follow guidelines for antibiotic prescription, especially when the level of private provision of primary healthcare is high.

Investor-owned Health Care: The Hidden Blight on America's "System"

Investor ownership of US health care has grown exponentially in the past 50 years through ever closer ties with Wall Street corporate interests. More recently, private equity firms have accelerated this process, invariably with harmful impacts on access to affordable care, its quality, and profiteering, with little accountability. These impacts are fueled by several concurrent trends: (1) increasing privatization, (2) consolidation and mergers, (3) increasing bureaucracy and waste, and (4) profiteering that may bleed into outright fraud. This article traces the uncontrolled growth of health care costs and prices in recent decades, together with documented examples across the health care delivery system whereby profit-driven, investor-owned interests have compromised patient care. These include hospitals, emergency care, nursing homes, mental health, and practices of such specialities as obstetrics-gynecology and ophthalmology. These practices have compromised patient care in the midst of a pandemic and economic downturn, as reflected by markers of a system needing reform. A larger role of government is called for, together with the advantages of Medicare for All in establishing health care as a human right, not a privilege based on ability to pay.

From downcoding to upcoding: DRG based payment in hospitals

A prospective disease group-based payment is a reimbursement rule used in a wide array of countries. It turns to be the hospital's payment rule to imply. The secret of this payment is a fee payment as well as a hospital's activity based payment. There is a consensus to consider this rule of payment as the least likely to be manipulated by the actors. However, the defined fee per group depends on recorded information that is then processed using complex algorithms. What if the data itself can be manipulated? The result would be a fee per group based on manipulated factors that would lead to an inefficient budget allocation between hospitals. Using a unique French longitudinal database with 145 million stays, I unambiguously demonstrate that the implementation of a finer classification led to an upcoding-learning effect. The end result has been a budget transfer from public non-research hospitals to for-profit hospitals. The 2009 policy lead to upcoding disconnected from any changes in the trend of production of care.

Upcoding in a National Health Service: the evidence from Portugal

For many years, evidence from the USA has pointed out to the existence of upcoding in management practices. Upcoding is defined as classifying patients in diagnosis-related groups codes associated with larger payments. The incentive for upcoding is not restricted to private providers of care. Conceptually, any patient classification system that is used for payment purposes may be vulnerable to this sort of strategic behaviour by providers. We document here that upcoding occurs in a National Health Service where public hospitals have their payment (budget) tied to the classification of treatment episodes. Using diagnosis-related groups data from Portugal, we found that the practice of upcoding has been used in the hospitals in a way leading to larger budgets (age of patients plays a key role). The effect is quantitatively small. Copyright © 2016 John Wiley & Sons, Ltd.

Changes in Hospital Performance after Ownership Conversions

This paper examines the effects of ownership conversions on hospital performance between 1987 and 1998 in areas of financial performance, staffing, capacity, and unprofitable care. Conversions to government and for-profit ownership both increased the profit margin: the former due to rising revenue, and the latter due to reduced operating costs and rising revenue. Hospitals that converted to for-profit ownership had the greatest reduction in staffing relative to other converted hospitals. There was little change in bed capacity after conversion to for-profit status, but some reductions in bed capacity after conversion to government or nonprofit status. No conversion of any kind led to a reduced amount of unprofitable care, but conversion to private ownership (nonprofit and for-profit) increased the probability of trauma center closures.

Myths and Memes about Single-Payer Health Insurance in the United States: A Rebuttal to Conservative Claims

Recent years have seen the rapid growth of private think tanks within the neoconservative movement that conduct “policy research” biased to their own agenda. This article provides an evidence-based rebuttal to a 2002 report by one such think tank, the Dallas-based National Center for Policy Analysis (NCPA), which was intended to discredit 20 alleged myths about single-payer national health insurance as a policy option for the United States. Eleven “myths” are rebutted under eight categories: access, cost containment, quality, efficiency, single-payer as solution, control of drug prices, ability to compete abroad (the “business case”), and public support for a single-payer system. Six memes (self-replicating ideas that are promulgated without regard to their merits) are identified in the NCPA report. Myths and memes should have no place in the national debate now underway over the future of a failing health care system, and need to be recognized as such and countered by experience and unbiased evidence.

Practice Arrangement and Medicare Physician Payment in Otolaryngology

Objective

Medicare Part B physician payment indicates a cost to Medicare beneficiaries for a physician service and connotes physician clinical productivity. The objective of this study was to determine whether there was an association between practice arrangement and Medicare physician payment.

Study Design

Cross-sectional study.

Setting

Medicare provider utilization and payment data.

Subjects and Methods

Otolaryngologists from 1 metropolitan area were included as part of a pilot study. A generalized linear model was used to determine the effect of practice-specific variables including patient volumes on physician payment.

Results

Of 67 otolaryngologists included, 23 (34%) provided services through an independent practice, while others were employed by 1 of 3 local academic centers. Median payment was $58,895 per physician for the year, although some physicians received substantially higher payments. Reimbursements to faculty at 1 academic department were higher than to those at other institutions or to independent practitioners. After adjustments were made for patient volumes, physician subspecialty, and gender, payments to each faculty at Hospital C were 2 times higher than to those at Hospital A (relative ratio [RR] 2.03; 95% CI, 1.27-3.27; P = .003); 2 times higher than to faculty at Hospital B (RR 2.04; 95% CI, 1.4-2.7; P = .0001); and 1.6 times higher than to independent practitioners (RR 1.6; 95% CI, 1.04-2.7; P = .03). Payments to physicians in the other groups were not significantly different. Differences in reimbursement corresponded to an emphasis on procedures over office visits but not Medicare case mix adjustments for patient discharges from associated institutions.

Conclusions

Variation in the cost of academic otolaryngology care may be subject in part to institutional factors.

Harnessing the privatisation of China's fragmented health-care delivery

Although China's 2009 health-care reform has made impressive progress in expansion of insurance coverage, much work remains to improve its wasteful health-care delivery. Particularly, the Chinese health-care system faces substantial challenges in its transformation from a profit-driven public hospital-centred system to an integrated primary care-based delivery system that is cost effective and of better quality to respond to the changing population needs. An additional challenge is the government's latest strategy to promote private investment for hospitals. In this Review, we discuss how China's health-care system would perform if hospital privatisation combined with hospital-centred fragmented delivery were to prevail--population health outcomes would suffer; health-care expenditures would escalate, with patients bearing increasing costs; and a two-tiered system would emerge in which access and quality of care are decided by ability to pay. We then propose an alternative pathway that includes the reform of public hospitals to pursue the public interest and be more accountable, with public hospitals as the benchmarks against which private hospitals would have to compete, with performance-based purchasing, and with population-based capitation payment to catalyse coordinated care. Any decision to further expand the for-profit private hospital market should not be made without objective assessment of its effect on China's health-policy goals.

Variations in US hospital performance on imaging-use measures

BACKGROUND

The Hospital Outpatient Quality Reporting Program (HOQR) publicly reports measures of US hospitals' use of 4 imaging studies that may be problematic if overused: magnetic resonance imaging (MRI) for low back, follow-up imaging after screening mammography, and abdominal and thoracic computed tomography (CT) with and without contrast.

OBJECTIVES

To characterize performance on these measures, determine whether performance was consistent across measures, and identify hospital characteristics associated with highest-decile imaging use.

RESEARCH DESIGN

Cross-sectional analysis.

MEASUREMENTS

Correlation across measures was assessed using Spearman rank order tests. We linked 2008 HOQR data to the 2009 American Hospital Association Survey and used multivariable logistic regression to examine associations between hospital characteristics and the likelihood of highest-decile imaging use.

RESULTS

Imaging use varied widely. Imaging use was weakly correlated (ρ<0.10) across most measures. Compared with hospitals with moderate imaging volume (25th to 75th percentile), hospitals with low volume (<25th percentile) were more likely to report highest-decile imaging use on all measures [adjusted odds ratios (95% confidence interval) range from 1.38 (1.05-1.80) for CT Abdomen to 4.22 (3.04-5.84) for MRI Back]. Rural hospitals were more likely to report highest-decile use on most measures [MRI: 1.42 (1.21-1.68), CT Abdomen: 1.46 (1.28-1.66), and CT Thorax: 1.32 (1.16-1.51)]. For-profit hospitals were more likely to report highest-decile use on mammography [1.47 (1.10-1.98)] and CT Thorax measures [1.71 (1.28-2.27)].

CONCLUSIONS

Wide variations in imaging use and extraordinarily high use at some hospitals may indicate that imaging overuse occurs at US hospitals. The effectiveness of the HOQR measures to decrease imaging overuse remains to be seen.

Norms of decision making in the ICU: a case study of two academic medical centers at the extremes of end-of-life treatment intensity

PURPOSE

To explore norms of decision making regarding life-sustaining treatments (LSTs) at two academic medical centers (AMCs) that contribute to their opposite extremes of end-of-life ICU use.

METHODS

We conducted a 4-week mixed methods case study at each AMC in 2008-2009 involving direct observation of patient care during rounds in the main medical ICU, semi-structured interviews with staff, patients, and families, and collection of artifacts (e.g., patient lists, standardized forms). We compared patterns of decision making regarding initiation, continuation, and withdrawal of LST using tests of proportions and grounded theory analysis of field note and interview transcripts.

RESULTS

We observed 80 patients [26 (32.5 %) ≥65 years old] staffed by 4 attendings, and interviewed 23 staff and 3 patients/families at the low-intensity AMC (LI-AMC), and observed 73 patients [26 (35.6 %) ≥65 years old] staffed by 4 attending physicians and interviewed 26 staff and 4 patients/families at the high-intensity AMC (HI-AMC). LST initiation among patients over 65 was similar, except feeding tubes (0 % LI-AMC versus 31 % HI-AMC, p = 0.002). The LI-AMC was more likely to use a time-limited trial of LST, followed by withdrawal (27 vs. 8 %, p = 0.01) and to have a known outcome of death (31 vs. 4 %, p < 0.001). We identified qualitative differences in goals of LST, the determination of "dying," concern about harms of commission versus omission, and physician self-efficacy for LST decision making.

CONCLUSIONS

Time-limited trials of LST at the LI-AMC and open-ended use of LST at the HI-AMC explain some of the AMCs' nationally profiled differences in end-of-life ICU use.

Insurance status and the care of adult patients 19 to 64 years of age visiting the emergency department

OBJECTIVES

The objective was to determine whether insurance status is associated with the care of patients presenting to the emergency department (ED).

METHODS

This was a retrospective cross-sectional analysis of ED visits using data from the National Hospital Ambulatory Medical Care Survey (NHAMCS; 1999 through 2008). Patients 19 to 64 years of age were categorized as having private insurance, public insurance, or no insurance as their primary insurance. Six components of ED care were assessed: wait time, left prior to discharge, use of diagnostic testing, treatment, instructions for follow-up, and whether the patient had been seen in the past 72 hours.

RESULTS

Nonprivate insurance status was associated with all six components of ED care, including higher proportions of leaving before discharge of patients with public insurance (4.1%, 95% confidence interval [CI]=3.8% to 4.5%) versus patients with no insurance (4.7%, 95% CI=4.2% to 5.1%) or private insurance (2.2%, 95% CI=2.0% to 2.4%; p<0.001). It was also associated with a higher proportion of return visits with 5.1% (95% CI=4.6% to 5.6%) of patients with public insurance versus 4.7% (95% CI=4.1% to 4.6%) of patients with no insurance versus 3.8% (95% CI=3.5% to 4.2%) of patients with private insurance (p<0.001). Patients with public or no insurance also had decreased odds of ED testing compared to those with private insurance (adjusted odds ratio [AOR] for public=0.84, 95% CI=0.80 to 0.88; and AOR for none=0.82, 95% CI=0.79 to 0.86).

CONCLUSIONS

Nonprivate insurance status is associated with different care patterns in adults aged 19 to 64 years visiting the ED. Further studies are needed to evaluate how these disparate care patterns affect health outcomes.

The general NFP hospital model

Throughout the past 30 years, there has been a lot of controversy surrounding the proliferation of new forms of health care delivery organizations that challenge and compete with general NFP community hospitals. Traditionally, the health care system in the United States has been dominated by general NFP (NFP) voluntary hospitals. With the number of for-profit general hospitals, physician-owned specialty hospitals, and ambulatory surgical centers increasing, a question arises: “Why is the general NFP community hospital the dominant model?” In order to address this question, this paper reexamines the history of the hospital industry. By understanding how the “general NFP hospital” model emerged and dominated, we attempt to explain the current dominance of general NFP hospitals in the ever changing hospital industry in the United States.

Payments and quality of care in private for-profit and public hospitals in Greece

BACKGROUND

Empirical evidence on how ownership type affects the quality and cost of medical care is growing, and debate on these topics is ongoing. Despite the fact that the private sector is a major provider of hospital services in Greece, little comparative information on private versus public sector hospitals is available. The aim of the present study was to describe and compare the operation and performance of private for-profit (PFP) and public hospitals in Greece, focusing on differences in nurse staffing rates, average lengths of stay (ALoS), and Social Health Insurance (SHI) payments for hospital care per patient discharged.

METHODS

Five different datasets were prepared and analyzed, two of which were derived from information provided by the National Statistical Service (NSS) of Greece and the other three from data held by the three largest SHI schemes in the country. All data referred to the 3-year period from 2001 to 2003.

RESULTS

PFP hospitals in Greece are smaller than public hospitals, with lower patient occupancy, and have lower staffing rates of all types of nurses and highly qualified nurses compared with public hospitals. Calculation of ALoS using NSS data yielded mixed results, whereas calculations of ALoS and SHI payments using SHI data gave results clearly favoring the public hospital sector in terms of cost-efficiency; in all years examined, over all specialties and all SHI schemes included in our study, unweighted ALoS and SHI payments for hospital care per discharge were higher for PFP facilities.

CONCLUSIONS

In a mixed healthcare system, such as that in Greece, significant performance differences were observed between PFP and public hospitals. Close monitoring of healthcare provision by hospital ownership type will be essential to permit evidence-based decisions on the future of the public/private mix in terms of healthcare provision.

Following the money: factors associated with the cost of treating high-cost Medicare beneficiaries

OBJECTIVE

To identify factors associated with the cost of treating high-cost Medicare beneficiaries.

DATA SOURCES

A national sample of 1.6 million elderly, Medicare beneficiaries linked to 2004-2005 Community Tracking Study Physician Survey respondents and local market data from secondary sources.

STUDY DESIGN

Using 12 months of claims data from 2005 to 2006, the sample was divided into predicted high-cost (top quartile) and lower cost beneficiaries using a risk-adjustment model. For each group, total annual standardized costs of care were regressed on beneficiary, usual source of care physician, practice, and market characteristics.

PRINCIPAL FINDINGS

Among high-cost beneficiaries, health was the predominant predictor of costs, with most physician and practice and many market factors (including provider supply) insignificant or weakly related to cost. Beneficiaries whose usual physician was a medical specialist or reported inadequate office visit time, medical specialist supply, provider for-profit status, care fragmentation, and Medicare fees were associated with higher costs.

CONCLUSIONS

Health reform policies currently envisioned to improve care and lower costs may have small effects on high-cost patients who consume most resources. Instead, developing interventions tailored to improve care and lowering cost for specific types of complex and costly patients may hold greater potential for "bending the cost curve."

Uncompensated care provided by for-profit, not-for-profit, and government owned hospitals

Background

There is growing concern certain not-for-profit hospitals are not providing enough uncompensated care to justify their tax exempt status. Our objective was to compare the amount of uncompensated care provided by not-for-profit (NFP), for-profit (FP) and government owned hospitals.

Methods

We used 2005 state inpatient data (SID) for 10 states to identify patients hospitalized for three common conditions: acute myocardial infarction (AMI), coronary artery bypass grafting (CABG), or childbirth. Uncompensated care was measured as the proportion of each hospital's total admissions for each condition that were classified as being uninsured. Hospitals were categorized as NFP, FP, or government owned based upon data obtained from the American Hospital Association. We used bivariate methods to compare the proportion of uninsured patients admitted to NFP, FP and government hospitals for each diagnosis. We then used generalized linear mixed models to compare the percentage of uninsured in each category of hospital after adjusting for the socioeconomic status of the markets each hospital served.

Results

Our cohort consisted of 188,117 patients (1,054 hospitals) hospitalized for AMI, 82,261 patients (245 hospitals) for CABG, and 1,091,220 patients for childbirth (793 hospitals). The percentage of admissions classified as uninsured was lower in NFP hospitals than in FP or government hospitals for AMI (4.6% NFP; 6.0% FP; 9.5% government; P < .001), CABG (2.6% NFP; 3.3% FP; 7.0% government; P < .001), and childbirth (3.1% NFP; 4.2% FP; 11.8% government; P < .001). In adjusted analyses, the mean percentage of AMI patients classified as uninsured was similar in NFP and FP hospitals (4.4% vs. 4.3%; P = 0.71), and higher for government hospitals (6.0%; P < .001 for NFP vs. government). Likewise, results demonstrated similar proportions of uninsured patients in NFP and FP hospitals and higher levels of uninsured in government hospitals for both CABG and childbirth.

Conclusions

For the three conditions studied NFP and FP hospitals appear to provide a similar amount of uncompensated care while government hospitals provide significantly more. Concerns about the amount of uncompensated care provided by NFP hospitals appear warranted.

Health policy reform in China: lessons from Asia

Declining access to health care and rapidly rising health expenditures are a matter of grave public concern in China. After decades of efforts to reduce its involvement, the Chinese government is currently in the process of reforming the sector through increase in public expenditures and expansion of health insurance. The objective of this paper is to assess the potential of the reform direction in light of international experiences with similar reforms. It argues--on the basis of examination of reform experiences in Korea, Singapore and Thailand--that financing reforms without parallel measures to improve the provision system, especially how providers are paid, are unlikely to address the problems and may actually aggravate them. If the financing reforms are to succeed, it is vital for China to reform the incentives that guide the providers' behaviour.

The influence of facility ownership structure on individual responding to stress: a multilevel model

Few studies have investigated the effect of health-care facility ownership on the relationship between patient stressors and coping strategies. The purpose of this study was to investigate whether haemodialysis (HD) patient stressors and coping strategies differ by type of health-care facility ownership, and whether such ownership has a cross-level moderating effect between stressors and coping strategies. We used the Haemodialysis Stressor Scale and the Jalowiec Coping Scale; primary data were collected by interviewing 2642 HD patients 15 years or older on dialysis for at least three months from 27 HD centres. One-way analysis of variance and hierarchical linear modelling were used to attain the research purposes. HD patients from religious-based hospitals had higher stress related to their physical symptoms, dependency on medical staff, role ambiguity and blood vessel problems than those differently owned facilities. Patients in veterans and army (VA) hospitals had higher stress related to food and fluid restriction and dependency on medical staff than private centres. Patients in religious-based hospitals had significantly higher coping scores, followed by VA and private HD centres. Religion-based ownership might serve as a cross-level moderator for patients perceiving role ambiguity stress and using problem-oriented, support seeking and isolated thought-coping strategies.

Ethics in American health 2: an ethical framework for health system reform

I argue that an ethical vision resting on explicitly articulated values and norms is critical to ensuring comprehensive health reform. Reform requires a consensus on the public good transcending self-interest and narrow agendas and underpinning collective action for universal coverage. In what I call shared health governance, individuals, providers, and institutions all have essential roles in achieving health goals and work together to create a positive environment for health. This ethical paradigm provides (1) reasoned consensus through a joint scientific and deliberative approach to judge the value of a health care intervention; (2) a method for achieving consensus that differs from aggregate tools such as a strict majority vote; (3) combined technical and ethical rationality for collective choice; (4) a joint clinical and economic approach combining efficiency with equity, but with economic solutions following and complementing clinical progress; and (5) protection for disabled individuals from discrimination.

The risk of upcoding in casemix systems: a comparative study

With the introduction of a diagnosis related group (DRG) classification system in the Netherlands in 2005 it has become relevant to investigate the risk of upcoding. The problem of upcoding in the US casemix system is substantial. In 2004, the US Centres for Medicare and Medicaid estimated that the total number of improper Medicare payments for the Prospective Payment system for acute inpatient care (both short term and long term) amounted to US$ 4.8 billion (5.2%). By comparing the casemix systems in the US, Australian and Dutch healthcare systems, this article illustrates why certain casemix systems are more open to the risk of upcoding than other systems. This study identifies various market, control and casemix characteristics determining the weaknesses of a casemix reimbursement system to upcoding. It can be concluded that fewer opportunities for upcoding occur in casemix systems that do not allow for-profit ownership and in which the coder's salary does not depend on the outcome of the classification process. In addition, casemix systems in which the first point in time of registration is at the beginning of the care process and in which there are a limited number of occasions to alter the registration are less vulnerable to the risk of upcoding. Finally, the risk of upcoding is smaller in casemix systems that use classification criteria that are medically meaningful and aligned with clinical practice. Comparing the US, Australian and Dutch systems the following conclusions can be drawn. Given the combined occurrences of for-profit hospitals and the use of the secondary diagnosis criterion to classify DRGs, the US casemix system tends to be more open to upcoding than the Australian system. The strength of the Dutch system is related to the detailed classification scheme, using medically meaningful classification criteria. Nevertheless, the detailed classification scheme also causes a weakness, because of its increased complexity compared with the US and Australian system. It is recommended that researchers and policy makers carefully consider all relevant market, control and casemix characteristics when developing and restructuring casemix reimbursement systems.

The role of tax exemption in a competitive health care market

The Federal Trade Commission and Department of Justice 2004 report on competition in health care raises the issue of nonprofit versus for-profit form in several contexts, including their relative financial performance, pricing behavior, and role in caring for the uninsured poor. The report, however, does not discuss in detail the connection between tax exemption and the nonprofit/for-profit debate. Is tax exemption, for example, "buying" charity care for the poor, and would withdrawal of exemption negatively impact health care for the uninsured poor? Or is tax exemption justified on the grounds of other nonprofit behavior outside the financial realm and thus not considered by the report? If nonprofit status does not result in differential financial behavior (as the report concludes) and if competition will end the ability of hospitals to cross subsidize free care for the poor (as the report speculates), is there any reason to retain tax exemption for nonprofit hospitals? This article summarizes the debate on these issues and offers some alternatives to the current structure of tax exemption for nonprofit health care providers.

How Do Hospitals Respond to Price Changes?

This paper examines hospital responses to changes in diagnosis-specific prices by exploiting a 1988 policy reform that generated large price changes for 43 percent of Medicare admissions. I find hospitals responded primarily by "upcoding" patients to diagnosis codes with the largest price increases. This response was particularly strong among for-profit hospitals. I find little evidence hospitals increased the volume of admissions differentially for diagnoses subject to the largest price increases, despite the financial incentive to do so. Neither did they increase intensity or quality of care in these diagnoses, suggesting hospitals do not compete for patients at the diagnosis level.

The Effects of Fraud on the Evaluation of Health Care

Studies on health care practices, financing, and organization increasingly rely on Medicare and other expanded data sets. These studies are of critical importance for public policy and for the development of strategies to contain escalating health care costs, but they often use data that have been corrupted by fraud and abuse. Mistaken conclusions, as to the effectiveness of policy and procedures, are likely being reached in studies that have used corrupted data. Researchers need to consider the suspect nature of results obtained from the corrupted data, and determine methods for making the data more valid.

Cost convergence between public and for-profit hospitals under prospective payment and high competition in Taiwan

OBJECTIVE

To test the hypotheses that: (1) average adjusted costs per discharge are higher in high-competition relative to low-competition markets, and (2) increased competition is associated with cost convergence between public and for-profit (FP) hospitals for case payment diagnoses, but not for cost-plus reimbursed diagnoses.

DATA SOURCES

Taiwan's National Health Insurance database; 325,851 inpatient claims for cesarean section, vaginal delivery, prostatectomy, and thyroidectomy (all case payment), and bronchial asthma and cholelithiasis (both cost-based payment).

STUDY DESIGN

Retrospective population-based, cross-sectional study.

DATA ANALYSIS

Diagnosis-wise regression analyses were done to explore associations between cost per discharge and hospital ownership under high and low competition, adjusted for clinical severity and institutional characteristics.

PRINCIPAL FINDINGS

Adjusted costs per discharge are higher for all diagnoses in high-competition markets. For case payment diagnoses, the magnitudes of adjusted cost differences between public and FP hospitals are lower under high competition relative to low competition. This is not so for the cost-based diagnoses.

CONCLUSIONS

We find that the empirical evidence supports both our hypotheses.

Strategic Management and Performance Differences

Despite mixed and contradictory findings, for-profits (FPs) and nonprofits (NPs) are assumed to be similar health services organizations (HSOs). In this study, a fifteen-item scale assessing HSOs' strategic management capacity was developed and tested using fifty-seven FP and twenty NP organizations. Then, using item response theory, the items were hierarchically profiled to produce two strategic profile models, a general and an FP anchored model. We find that deviation from the general profile, but not capability attainment level, is related to two of three financial measures. We conclude that studying FPs and NPs together is appropriate.

Health care or health trade? A historic moment of choice

During the 20th century, medical care evolved from a notional economy of trying to a real economy of doing. Care systems can therefore usefully be measured and evaluated as production systems. Whether they will succumb to the pattern of competitive commodity production for profit in the market, or will succeed in developing their own new gift economy for human needs, will become a dominant political and economic issue in the 21st century. Health care is now becoming industrialized in essentially the same way as textile manufacture was industrialized in the 19th century, with corresponding loss of control by skilled workers over their work processes. The outcome of the struggle between skilled handloom weavers and their industrializing employers was determined by the huge rise in productivity associated with machines. The outcome of current struggles between public service and state-subsidized corporate care for profit will be decided likewise by superior productivity. Evidence suggests that in terms of health outcome, democratized public care with a much expanded and diversified workforce could be far more productive than industrialization.

Payments for care at private for-profit and private not-for-profit hospitals: a systematic review and meta-analysis

BACKGROUND

It has been shown that patients cared for at private for-profit hospitals have higher risk-adjusted mortality rates than those cared for at private not-for-profit hospitals. Uncertainty remains, however, about the economic implications of these forms of health care delivery. Since some policy-makers might still consider for-profit health care if expenditure savings were sufficiently large, we undertook a systematic review and meta-analysis to compare payments for care at private for-profit and private not-for-profit hospitals.

METHODS

We used 6 search strategies to identify published and unpublished observational studies that directly compared the payments for care at private for-profit and private not-for-profit hospitals. We masked the study results before teams of 2 reviewers independently evaluated the eligibility of all studies. We confirmed data or obtained additional data from all but 1 author. For each study, we calculated the payments for care at private for-profit hospitals relative to private not-for-profit hospitals and pooled the results using a random effects model.

RESULTS

Eight observational studies, involving more than 350 000 patients altogether and a median of 324 hospitals each, fulfilled our eligibility criteria. In 5 of 6 studies showing higher payments for care at private for-profit hospitals, the difference was statistically significant; in 1 of 2 studies showing higher payments for care at private not-for-profit hospitals, the difference was statistically significant. The pooled estimate demonstrated that private for-profit hospitals were associated with higher payments for care (relative payments for care 1.19, 95% confidence interval 1.07-1.33, p = 0.001).

INTERPRETATION

Private for-profit hospitals result in higher payments for care than private not-for-profit hospitals. Evidence strongly supports a policy of not-for-profit health care delivery at the hospital level.

Medicare upcoding and hospital ownership

Many hospitals in the 1990s many hospitals were accused of "upcoding" patient diagnostic related groups (DRGs) to increase Medicare reimbursements. We find that between 1989 and 1996, the percentage point share of the most generous DRG for pneumonia and respiratory infections rose by 10 points among not-for-profit hospitals, 23 points among for-profit hospitals, and 37 points in hospitals converting to for-profit status. Not-for-profit upcoding was also higher in markets with a larger for-profit hospital share. Upcoding appears to reflect both risk-taking by administrators and a closer alignment between the goals of the administration and the behavior of the clinical staff.

Quality standards for health care delivery and management in publicly oriented health services

In 1999, the multidisciplinary Tavistock group prepared a generic statement of ethical principles to govern health care systems. This paper elaborates on these principles in two directions. First, it develops a set of quality standards, based on ethical principles, intended to regulate health care delivery and service management. Second, it focuses them on 'publicly oriented' (not necessarily governmental) as opposed to 'for profit' (not necessarily private) services. We propose ten principles or quality standards for these services, part of which relate to the individual patients, others to the community. They are political as well as technical, and can be used to inspire health policies, contracts issued by governments, and identification of partners by aid agencies. We analyse their application in key areas of health care by publicly oriented and for-profit health care organizations standards in developing countries, and conclude that the latter are unlikely to adopt the proposed standards. We further elaborate on the implications of the standards for publicly oriented services, focusing on care delivery and patient-centred care, family and community medicine, services management and disease control. Using these criteria for a renewed compact between authorities, health professionals and communities may help to motivate health professionals by bridging the gap between their professional and social-political identity.

Does the ownership of the admitting hospital make a difference? Outcomes and process of care of Medicare beneficiaries admitted with acute myocardial infarction

BACKGROUND

Concerns have been expressed about quality of for-profit hospitals and their use of expensive technologies.

OBJECTIVE

To determine differences in mortality after admission for acute myocardial infarction (AMI) and in the use of low- and high-tech services for AMI among for-profit, public, and private nonprofit hospitals.

STUDY DESIGN, SETTING, AND PATIENTS

Cooperative Cardiovascular Project data for 129,092 Medicare patients admitted for AMI from 1994 to 1995.

MAIN OUTCOME MEASURES

Mortality at 30 days and 1 year postadmission; use of aspirin, angiotensin-converting enzyme (ACE) inhibitors, beta-blockers at discharge, thrombolytic therapy, catheterization, percutaneous transluminal coronary angioplasty (PTCA), and coronary artery bypass graft (CABG) compared by ownership.

RESULTS

Mortality rates at 30 days and at 1 year at for-profit hospitals were no different from those at public and private nonprofit hospitals. Without patient illness variables, nonprofit hospitals had lower mortality rates at 30 days (relative risk [RR], 0.95; 95% confidence interval [CI], 0.91-0.99) and at 1 year (RR, 0.96; 95% CI, 0.93-0.99) than did for-profit hospitals, but there was no difference in mortality between public and for-profit hospitals. Beneficiaries at nonprofit hospitals were more likely to receive aspirin (RR, 1.04; 95% CI, 1.03-1.05) and ACE inhibitors (RR, 1.05; 95% CI, 1.02-1.08) than at for-profit hospitals, but had lower rates of PTCA (RR, 0.91; 95% CI, 0.86-0.96) and CABG (RR, 0.93; 95% CI, 0.86-1.00).

CONCLUSIONS

Although outcomes did not vary by ownership, for-profit hospitals were more likely to use expensive, high-tech procedures. This pattern appears to be the result of for-profit hospitals' propensity to locate in areas with demand for high-tech care for AMI.

Managed care or managed inequality? A call for critiques of market-based medicine

This review article critiques the growing dominance of market-based medicine in the United States against the background of existing problems with quality of care, rising costs, devaluation of doctor-patient relationships, and, especially, persistent inequalities of access and outcomes. It summarizes the present state of health care delivery by focusing on the concurrent trends of growth in managed care, expanding profits, increasing proportion of those uninsured, and widening racial, ethnic, and class disparities in access to care. Allowing market forces to dictate the shape of health care delivery in this country ensures that inequalities will continue to grow and modern medicine will become increasingly adept at managing inequality rather than managing (providing) care. The article challenges anthropology to become more involved in critiquing these developments and suggests how anthropologists can expand on and contextualize debates surrounding the market's role in medicine, here and abroad.

The effect of hospital ownership choice on patient outcomes after treatment for acute myocardial infarction

I examine the effect of ownership choice on patient outcomes after the treatment for acute myocardial infarction. I find that for-profit and government hospitals have higher incidence of adverse outcomes than not-for-profit hospitals by 3-4%. In addition, the incidence of adverse outcomes increases by 7-9% after a not-for-profit hospital converts to for-profit ownership, but there is little change in patient outcomes in other forms of ownership conversion. The findings are robust, whether I use the entire sample or subsamples of hospitals that share similar hospital and market characteristics.

Does investor-ownership of nursing homes compromise the quality of care?

Quality problems have long plagued the nursing home industry. While two-thirds of U.S. nursing homes are investor-owned, few studies have examined the impact of investor-ownership on the quality of care. The authors analyzed 1998 data from inspections of 13,693 nursing facilities representing virtually all U.S. nursing homes. They grouped deficiency citations issued by inspectors into three categories ("quality of care," "quality of life," and "other") and compared deficiency rates in investor-owned, nonprofit, and public nursing homes. A multivariate model was used to control for case mix, percentage of residents covered by Medicaid, whether the facility was hospital-based, whether it was a skilled nursing facility for Medicare only, chain ownership, and location by state. The study also assessed nurse staffing. The authors found that investor-owned nursing homes provide worse care and less nursing care than nonprofit or public homes. Investor-owned facilities averaged 5.89 deficiencies per home, 46.5 percent higher than nonprofit and 43.0 percent higher than public facilities, and also had more of each category of deficiency. In the multivariate analysis, investor-ownership predicted 0.679 additional deficiencies per home; chain-ownership predicted an additional 0.633 deficiencies per home. Nurse staffing ratios were markedly lower at investor-owned homes.

Rural hospitals: trends, challenges, and a future research and policy analysis agenda

Previous reviews of the status of rural hospitals conclude that rural hospitals play a major role in ensuring the provision of health services in rural areas, are an essential part of the social and economic identity of rural communities, have had mixed success in their ability to respond to environmental threats, and are very sensitive to public policies due, in part, to their small size. The evolving hospital paradigm in the United States and a turbulent economic and health care environment have created an uncertain future for the rural hospital. Hospitals are being forced to shift their emphasis from filling acute inpatient care beds to providing a more diversified set of services through linkages with other institutions and provider groups. This presents challenges for rural hospitals, which often serve as the foundation for health care delivery in rural communities yet struggle to overcome the effects of troubled local economies, shortages of health professionals, and public policy inequities. This article reviews key trends and challenges facing rural hospitals from the perspective of their structure and organization, financial sustainability, quality of care provided, and strategic linkages with other entities. It concludes with the presentation of a research and policy analysis agenda that addresses the feasibility of the role of the rural hospital as the hub or coordinator of the rural health care delivery system, the fiscal viability of the rural hospital in the post-Balanced Budget Act period, strategies for measuring and improving the quality of care provided by rural hospitals, and the structure and value of horizontal and vertical linkages of rural hospitals.

Preferences for patient cost sharing among medicare beneficiaries after HMO plan withdrawals

OBJECTIVE

To assess Medicare beneficiaries' willingness to cost share in order to minimize disruptions in coverage from HMO plan withdrawals.

DESIGN

Cross-sectional survey of Medicare beneficiaries from February 1999 to March 1999.

SETTING

Ten U.S. counties with the highest HMO plan withdrawal rates.

PATIENTS/PARTICIPANTS

Seven hundred one Medicare beneficiaries for response rate of 69%.

MEASUREMENTS AND MAIN RESULTS

Percentage of respondents willing to accept more out-of-pocket costs in order to continue their Medicare HMO coverage. Most respondents (67%) were willing to pay more out-of-pocket costs so that their HMO could have continued Medicare coverage. Those who were white (P =.03), had higher incomes (P =.01), and returned to traditional fee-for-service Medicare (P =.004) were more likely than other respondents to accept increased patient cost sharing. Most beneficiaries preferred Medicare policies requiring HMOs to sign longer-term Health Care Financing Administration (HCFA) contracts (72%) and to offer coverage to beneficiaries regardless of where they lived in a given state (87%). However, respondents' preferences for such policy options were not associated with the amount of cost sharing that respondents were willing to accept.

CONCLUSIONS

Most Medicare beneficiaries are willing to accept increased patient cost sharing in order to reduce disruptions in their HMO coverage. Policies intended to reduce HMO plan withdrawals, such as requiring health plans to sign longer-term HCFA contracts, are supported by many Medicare beneficiaries, but these policy preferences were not related to willingness to cost share. In light of an apparent willingness to pay more out-of-pocket medical costs, Medicare beneficiaries in general may accept increased cost sharing in order to retain their HMO coverage.

Health and social security reforms in Latin America: the convergence of the World Health Organization, the World Bank, and transnational corporations

International financial institutions have played an increasing role in the formation of social policy in Latin American countries over the last two decades, particularly in health and pension programs. World Bank loans and their attached policy conditions have promoted several social security reforms within a neoliberal framework that privileges the role of the market in the provision of health and pensions. Moreover, by endorsing the privatization of health services in Latin America, the World Health Organization has converged with these policies. The privatization of social security has benefited international corporations that become partners with local business elites. Thus the World Health Organization, international financial institutions, and transnational corporations have converged in the neoliberal reforms of social security in Latin America. Overall, the process represents a mechanism of resource transfer from labor to capital and sheds light on one of the ways in which neoliberalism may affect the health of Latin American populations.

Does investor ownership of nursing homes compromise the quality of care?

OBJECTIVES

Two thirds of nursing homes are investor owned. This study examined whether investor ownership affects quality.

METHODS

We analyzed 1998 data from state inspections of 13,693 nursing facilities. We used a multivariate model and controlled for case mix, facility characteristics, and location.

RESULTS

Investor-owned facilities averaged 5.89 deficiencies per home, 46.5% higher than nonprofit facilities and 43.0% higher than public facilities. In multivariate analysis, investor ownership predicted 0.679 additional deficiencies per home; chain ownership predicted an additional 0.633 deficiencies. Nurse staffing was lower at investor-owned nursing homes.

CONCLUSIONS

Investor-owned nursing homes provide worse care and less nursing care than do not-for-profit or public homes.