Hospital Finances During the First Two Years of the COVID-19 Pandemic: Evidence From Washington State Hospitals.

The COVID-19 pandemic created a broad array of challenges for hospitals. These challenges included restrictions on admissions and procedures, patient surges, rising costs of labor and supplies, and a disparate impact on already disadvantaged populations. Many of these intersecting challenges put pressure on hospitals' finances. There was concern that financial pressure would be particularly acute for hospitals serving vulnerable populations, including safety-net (SN) hospitals and critical access hospitals (CAHs). Using data from hospitals in Washington State, we examined changes in operating margins for SN hospitals, CAHs, and other acute care hospitals in 2020 and 2021. We found that the operating margins for all three categories of hospitals fell from 2019 to 2020, with SNs and CAHs sustaining the largest declines. During 2021, operating margins improved for all three hospital categories but SN operating margins still remained negative. Both changes in revenue and changes in expenses contributed to observed changes in operating margins. Our study is one of the first to describe how the financial effects of COVID-19 differed for SNs, CAHs, and other acute care hospitals over the first two years of the pandemic. Our results highlight the continuing financial vulnerability of SNs and demonstrate how the factors that contribute to profitability can shift over time.

Does Interdisciplinary Care Team Care Management Improve Health Quality and Demonstrate Cost-Effectiveness?

This study evaluated the impact of an interdisciplinary care teams (IDCT) care management program on cost and quality outcomes using a novel algorithm to identify 400 high-risk patients out of 48,235 Medicare Advantage (MA) beneficiaries. Of the 400, 252 were enrolled in the IDCT care management intervention program, while the remaining 148 were not enrolled. A second comparison group consisted of 660 who were referred to the IDCT program but not selected by the algorithm. The program's effectiveness was evaluated 1-year postintervention. Analyses found that health care costs for members enrolled in the IDCT program were reduced by US$1,121.76 and US$1,625.61 per member per month, respectively, relative to those not enrolled and those enrolled by referral. The cost reduction from the program generated a net savings of US$1.9MM, covering the program's cost. Findings suggest IDCTs can cost-effectively manage populations of high-risk patients with better selection and fostering greater interdependence.

Improving risk stratification using AI and social determinants of health.

OBJECTIVES: To determine whether a risk prediction model using artificial intelligence (AI) to combine multiple data sources, including claims data, demographics, social determinants of health (SDOH) data, and admission, discharge, and transfer (ADT) alerts, more accurately identifies high-cost members than traditional models. STUDY DESIGN: The study used data from a Medicaid accountable care organization and included a population of 61,850 members continuously enrolled between May 2018 and April 2019. METHODS: Risk scores generated by 2 models were estimated for each member. One model, developed by Medical Home Network, used AI to analyze SDOH data, ADT activity, and claims and demographic characteristics, whereas the other model (Chronic Illness and Disability Payment System [CDPS]) relied only on demographic and claims information. To compare models, we calculated mean, median, and total spending for members with the highest 5% of AI risk scores and compared these with spending metrics for members with the highest 5% of CDPS scores. We also compared the number of members with the highest 5% of costs prospectively identified by each model as highest risk. We segmented the population by length of prior enrollment to control for varying levels of claims experience. RESULTS: The AI model consistently identified a higher proportion of the highest-spending members. Members deemed highest risk by the AI model also had higher spending than members deemed highest risk by the CDPS model. CONCLUSIONS: Identification of high-cost members can be improved by using AI to combine traditional sources of data (eg, claims and demographic information) with nontraditional sources (eg, SDOH, admission alerts).

Assessing the Performance Value of the Baldrige Journey: A Comparison of Baldrige Applicants and Nonapplicants.

GOAL: The national Baldrige program has supported performance excellence in healthcare since 1999. Previous studies have compared the performance of Baldrige hospital recipients to nonrecipients. This study, however, sought to address the question of whether the mere pursuit of the Baldrige award provides value. METHODS: This study used propensity score matching with linear and quantile regression techniques to understand the impact of hospitals applying the Baldrige Excellence Framework across a comprehensive set of standardized industry performance measures, regardless of award recognition. PRINCIPAL FINDINGS: The analysis demonstrated that Baldrige applicants outperformed non-Baldrige applicants in select operational measures of efficiency (such as inpatient average length of stay), patient experience, and financial measures (including return on net assets, days in accounts receivable, and expenses as a percentage of patient revenues). However, there was no statistically significant difference in clinical performance between Baldrige applicants and nonapplicants. PRACTICAL APPLICATIONS: The findings from this study suggest that hospital leaders can realize significant gains with select operational and financial measures without compromising clinical outcomes when applying the Baldrige Excellence Framework to their organizations.

Environmental and organizational correlates and motivations for provider-sponsored health plan ownership in the post-reform era.

BACKGROUND: The 1980s to 1990s saw many health systems in the United States enter and exit the insurance market in the form of provider-sponsored health plans (PSHPs). Reforms and value-based reimbursement methods have stimulated health care organizations to reconsider PSHP as a logical strategy. PURPOSE: The aim of this study was to examine market and organizational factors associated with PSHP ownership and motivations for engaging in PSHP after health care reforms. The resource dependence theory was used as a theoretical lens. METHODOLOGY/APPROACH: A sequential quantitative to qualitative mixed-methods design was used. The quantitative analysis examined data for 5,849 U.S. hospitals. Results were synthesized with qualitative findings from 10 semistructured interviews representing eight health systems in five states. RESULTS: Organizational and environmental characteristics were significantly associated with PSHP ownership. Hospital and payer concentration, Medicare penetration, income, unemployment rate, government, and for-profit and metro area hospitals were associated with a lower likelihood of PSHP ownership. Salaried physician arrangements, clinically integrated network membership and adoption of other risk-bearing arrangements were associated with higher odds of PSHP ownership. Interviewees described PSHP as the culmination of the journey to value-based care and as a strategy to improve patient care, compete, and diversify revenue streams. CONCLUSIONS: Both market and organizational factors are important considerations for hospitals contemplating PSHP ownership, and motivations for ownership cover a broad range of financial, competitive, strategic, and mission-based goals. PRACTICE IMPLICATIONS: Hospitals considering PSHP ownership must carefully evaluate their competitive landscapes and organizational resources to ensure optimal conditions for this strategy. PSHP ownership has high start-up costs and requires a long-term organizational commitment.

Hospital Performance in the First 6 Years of Medicare's Value-Based Purchasing Program.

The Medicare value-based purchasing (VBP) program, ongoing since 2013, uses financial bonuses and penalties to incentivize hospital quality improvements. Previous research has identified characteristics of penalized hospitals, but has not examined characteristics of hospitals with improvements in VBP program performance or consistent good performance. We identify five different trajectories of program performance (improvement, decline, consistent good or poor performance, mixed). A total of 11% of hospitals were penalized every year of the program, 24% improved their VBP program performance, 14% of hospitals consistently earned a bonus, while 18% performed well in the program's early years but experienced declines in performance. In 2013, organizational and community characteristics were associated with higher odds of improving relative to performing poorly every year. Few variables under managers' control were associated with program improvement, though accountable care organization participation was in some models. We find changes in VBP program metrics may have contributed to improvement in some hospitals' program scores.

Analyzing Workers' Compensation Claims and Payments Made Using Data from a Large Insurance Provider.

BACKGROUND: All states in the USA have established Workers' Compensation (WC) insurance systems/programs. WC systems address key occupational safety and health concerns. This effort uses data from a large insurance provider for the years 2011-2018 to provide estimates for WC payments, stratified by the claim severity, i.e., medical only, and indemnity. METHODS: Besides providing descriptive statistics, we used generalized estimating equations to analyze the association between the key injury characteristics (nature, source, and body part injured) and total WC payments made. We also provide the overall cost burden for the former. RESULTS: Out of the total 151,959 closed claims, 83% were medical only. The mean overall WC payment per claim for the claims that resulted in a payment was $1477 (SD: $7221). Adjusted models showed that mean payments vary by claim severity. For example, among medical only claims, the mean payment was the highest for amputations ($3849; CI: $1396, $10,608), and among disability and death related claims, ruptures cost the most ($14,285; $7772, $26,255). With frequencies taken into account, the overall cost burden was however the highest for strains. CONCLUSIONS: Workplace interventions should prioritize both the costs of claims on average and the frequency.

Better Together? An Examination of the Relationship Between Acute Care Hospital Mergers and Patient Experience.

EXECUTIVE SUMMARY: The United States is experiencing another wave of hospital mergers. Whether patients benefit from these mergers, however, remains an open issue for many interested stakeholders. One measure of the potential benefit of hospital mergers is how they affect patient experience. This study used a quasi-experimental design to examine the relationship between hospital mergers and four different Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) ratings (i.e., overall, physician communication, nurse communication, and staff responsiveness). The study findings showed an association between hospitals that experienced a merger and slower growth in HCAHPS scores for two of the four HCAHPS domains (overall and nurse communication) when compared to matching hospitals that did not merge. Findings from this study can guide and inform hospital administrators, health system boards, state and federal government regulators and policymakers, and others across the spectrum of healthcare stakeholders.

Enhancing Transitions From Rehabilitation Patient to Wellness Participant for People With Disabilities: An Opportunity for Hospital Community Benefit.

Pressure is increasing on not-for-profit hospitals to demonstrate that they provide sufficient benefit to the community to justify their tax-exempt status. Many industry observers have suggested that this community benefit should address unmet medical needs within the community, deficits in the social determinants of health, or health disparities within communities. We argue that one area of clear unmet need is assistance in helping bridge the transition that people with disabilities (PWD) must make from rehabilitation patient to wellness participant. Programs to bridge this transition are necessary because many PWD struggle to identify strategies to maintain and maximize their own well-being after discharge from the healthcare system. As a result, PWD have worse health outcomes than non-disabled individuals. To address these needs, we propose hospitals take a leading role in establishing new, community-based efforts to provide PWD with benefits that will support their effort to self-manage health. Hospitals are well-suited to lead the creation of these programs because of the important role they play in providing services to PWD and because of their ability to bring together multiple stakeholders required to make supportive programs sustainable.

Hospital ownership of postacute care providers and the cost of care.

BACKGROUND: Hospitals are facing incentives to manage the total cost of care for episodes of illness, including the costs of inpatient care as well as the cost of care provided by physicians and postacute care (PAC) providers. PAC is an especially important component of the overall cost of care. One strategy hospitals employ in managing this cost is to own PAC providers. Prior work on the relationship between PAC ownership and cost has reached mixed conclusions. PURPOSE: The aim of this study was to examine the associations between the episodic costs of care and hospital ownership of PAC providers, including skilled nursing facilities (SNFs), home health agencies (HHAs), and inpatient rehabilitation facilities (IRF). METHODOLOGY: We examine panel data on hospital ownership of PAC providers from the American Hospital Association for 2013-2015 and cost of care data from Centers for Medicare & Medicaid Services' Value-Based Purchasing Program. Using ordinary least squares, we quantify the association between a hospital's PAC ownership choice (both ownership of any PAC provider and ownership of particular types of providers) and the episodic cost of care. RESULTS: In 2015, 80% of hospitals owned some type of PAC provider. We find that ownership of SNFs and HHAs is associated with a lower episodic cost of care, whereas ownership of inpatient rehabilitation facilities is associated with higher episodic costs of care. The effects of ownership do not differ for hospitals that participate in a voluntary shared saving program (Bundled Payment for Care Improvement). CONCLUSION: The effects of PAC ownership vary by the type of PAC provider owned. Our results suggest that ownership of SNFs and HHAs may be a viable strategy for success in reimbursement programs that reward hospitals for managing the total costs for episodes of care.

Mid-Cretaceous amber inclusions reveal morphogenesis of extinct rachis-dominated feathers.

We describe three-dimensionally preserved feathers in mid-Cretaceous Burmese amber that share macro-morphological similarities (e.g., proportionally wide rachis with a "medial stripe") with lithic, two-dimensionally preserved rachis-dominated feathers, first recognized in the Jehol Biota. These feathers in amber reveal a unique ventrally concave and dorsoventrally thin rachis, and a dorsal groove (sometimes pigmented) that we identify as the "medial stripe" visible in many rachis-dominated rectrices of Mesozoic birds. The distally pennaceous portion of these feathers shows differentiated proximal and distal barbules, the latter with hooklets forming interlocking barbs. Micro-CT scans and transverse sections demonstrate the absence of histodifferentiated cortex and medullary pith of the rachis and barb rami. The highly differentiated barbules combined with the lack of obvious histodifferentiation of the barb rami or rachis suggests that these feathers could have been formed without the full suite and developmental interplay of intermediate filament alpha keratins and corneous beta-proteins that is employed in the cornification process of modern feathers. This study thus highlights how the development of these feathers might have differed from that of their modern counterparts, namely in the morphogenesis of the ventral components of the rachis and barb rami. We suggest that the concave ventral surface of the rachis of these Cretaceous feathers is not homologous with the ventral groove of modern rachises. Our study of these Burmese feathers also confirms previous claims, based on two-dimensional fossils, that they correspond to an extinct morphotype and it cautions about the common practice of extrapolating developmental aspects (and mechanical attributes) of modern feathers to those of stem birds (and their dinosaurian outgroups) because the latter need not to have developed through identical pathways.

A New Enantiornithine Bird with Unusual Pedal Proportions Found in Amber.

Recent discoveries of vertebrate remains trapped in middle Cretaceous amber from northern Myanmar [1, 2] have provided insights into the morphology of soft-tissue structures in extinct animals [3-7], in particular, into the evolution and paleobiology of early birds [4, 8, 9]. So far, five bird specimens have been described from Burmese amber: two isolated wings, an isolated foot with wing fragment, and two partial skeletons [4, 8-10]. Most of these specimens contain the remains of juvenile enantiornithine birds [4]. Here, we describe a new specimen of enantiornithine bird in amber, collected at the Angbamo locality in the Hukawng Valley. The new specimen includes a partial right hindlimb and remiges from an adult or subadult bird. Its foot, of which the third digit is much longer than the second and fourth digits, is distinct from those of all other currently recognized Mesozoic and extant birds. Based on the autapomorphic foot morphology, we erect a new taxon, Elektorornis chenguangi gen. et sp. nov. We suggest that the elongated third digit was employed in a unique foraging strategy, highlighting the bizarre morphospace in which early birds operated.

Avian tail ontogeny, pygostyle formation, and interpretation of juvenile Mesozoic specimens.

The avian tail played a critical role in the evolutionary transition from long- to short-tailed birds, yet its ontogeny in extant birds has largely been ignored. This deficit has hampered efforts to effectively identify intermediate species during the Mesozoic transition to short tails. Here we show that fusion of distal vertebrae into the pygostyle structure does not occur in extant birds until near skeletal maturity, and mineralization of vertebral processes also occurs long after hatching. Evidence for post-hatching pygostyle formation is also demonstrated in two Cretaceous specimens, a juvenile enantiornithine and a subadult basal ornithuromorph. These findings call for reinterpretations of Zhongornis haoae, a Cretaceous bird hypothesized to be an intermediate in the long- to short-tailed bird transition, and of the recently discovered coelurosaur tail embedded in amber. Zhongornis, as a juvenile, may not yet have formed a pygostyle, and the amber-embedded tail specimen is reinterpreted as possibly avian. Analyses of relative pygostyle lengths in extant and Cretaceous birds suggests the number of vertebrae incorporated into the pygostyle has varied considerably, further complicating the interpretation of potential transitional species. In addition, this analysis of avian tail development reveals the generation and loss of intervertebral discs in the pygostyle, vertebral bodies derived from different kinds of cartilage, and alternative modes of caudal vertebral process morphogenesis in birds. These findings demonstrate that avian tail ontogeny is a crucial parameter specifically for the interpretation of Mesozoic specimens, and generally for insights into vertebrae formation.

Health System Affiliation and 30-Day Readmission After Heart Attack in Black Men.

INTRODUCTION: Black patients who experience acute myocardial infarction and receive care in high minority-serving hospitals have higher readmission rates. This study explores how hospital system affiliation (centralized versus decentralized/independent) impacts 30-day readmissions after acute myocardial infarction in black men. METHODS: In 2018, the Healthcare Cost and Utilization Project State Inpatient Database (2009-2013) was used to observe 30-day readmission for acute myocardial infarction by race, and data from the American Hospital Association Annual Survey of Hospitals (2009-2013) to determine hospital system affiliation for the states Arizona, California, North Carolina, and Wisconsin. A series of hierarchic logistic regressions were conducted to determine if hospital system affiliation mediates the relationship between race and 30-day readmission. RESULTS: Of 63,743 hospitalizations for acute myocardial infarction among men between 2009 and 2013, black men accounted for 7.1% of hospitalizations and 8.0% of readmissions. In both models, race significantly predicted 30-day readmission (unadjusted OR=1.25, 95% CI=1.14, 1.37, p<0.001; AOR=1.13, 95% CI=1.03, 1.25, p=0.046). After controlling for system type, black men were more likely to be readmitted after acute myocardial infarction than white men in both models (unadjusted OR=1.25, 95% CI=1.14, 1.38, p<0.001; AOR=1.14, 95% CI=1.03, 1.25). There was no difference in odds of being readmitted by race and hospital system type (unadjusted OR=0.88, 95% CI=0.25, 3.07, p=0.84, AOR=1.02, 95% CI=0.21, 5.10, p=0.98). CONCLUSIONS: Black men appear to be more likely to be readmitted after acute myocardial infarction. Centralization does not appear to mediate the relationship between race and 30-day readmissions for acute myocardial infarction. SUPPLEMENT INFORMATION: This article is part of a supplement entitled African American Men's Health: Research, Practice, and Policy Implications, which is sponsored by the National Institutes of Health.

Risk Factors for Serious Prescription Opioid-Induced Respiratory Depression or Overdose: Comparison of Commercially Insured and Veterans Health Affairs Populations.

Objective: To characterize the risk factors associated with overdose or serious opioid-induced respiratory depression (OIRD) among medical users of prescription opioids in a commercially insured population (CIP) and to compare risk factor profiles between the CIP and Veterans Health Administration (VHA) population. Subjects and Methods: Analysis of data from 18,365,497 patients in the IMS PharMetrics Plus health plan claims database (CIP) who were dispensed a prescription opioid in 2009 to 2013. Baseline factors associated with an event of serious OIRD among 7,234 cases and 28,932 controls were identified using multivariable logistic regression. The CIP risk factor profile was compared with that from a corresponding logistic regression among 817 VHA cases and 8,170 controls in 2010 to 2012. Results: The strongest associations with serious OIRD in CIP were diagnosed substance use disorder (odds ratio [OR] = 10.20, 95% confidence interval [CI] = 9.06-11.40) and depression (OR = 3.12, 95% CI = 2.84-3.42). Other strongly associated factors included other mental health disorders; impaired liver, renal, vascular, and pulmonary function; prescribed fentanyl, methadone, and morphine; higher daily opioid doses; and concurrent psychoactive medications. These risk factors, except depression, vascular disease, and specific opioids, largely aligned with VHA despite CIP being substantially younger, including more females and less chronic disease, and having greater prescribing prevalence of higher daily opioid doses, specific opioids, and most selected nonopioids. Conclusions: Risk factor profiles for serious OIRD among US medical users of prescription opioids with private or public health insurance were largely concordant despite substantial differences between the populations in demographics, clinical conditions, health care delivery systems, and clinical practices.

Taxes, bankruptcy costs, and capital structure in for-profit and not-for-profit hospitals.

About 60% of the US hospitals are not-for-profit and it is not clear how traditional theories of capital structure should be adapted to understand the borrowing behavior of not-for-profit hospitals. This paper identifies important determinants of capital structure taken from theories describing for-profit firms as well as prior literature on not-for-profit hospitals. We examine the differential effects these factors have on the capital structure of for-profit and not-for-profit hospitals. Specifically, we use a difference-in-differences regression framework to study how differences in leverage between for-profit and not-for-profit hospitals change in response to key explanatory variables (i.e. tax rates and bankruptcy costs). The sample in this study includes most US short-term general acute hospitals from 2000 to 2012. We find that personal and corporate income taxes and bankruptcy costs have significant and distinct effects on the capital structure of for-profit and not-for-profit hospitals. Specifically, relative to not-for-profit hospitals: (1) higher corporate income tax encourages for-profit hospitals to increase their debt usage; (2) higher personal income tax discourages for-profit hospitals to use debt; and (3) higher expected bankruptcy costs lead for-profit hospitals to use less debt. Over the past decade, the capital structure of for-profit hospitals has been more flexible as compared to that of not-for-profit hospitals. This may suggest that not-for-profit hospitals are more constrained by external financing resources. Particularly, our analysis suggests that not-for-profit hospitals operating in states with high corporate taxes but low personal income taxes may face particular challenges of borrowing funds relative to their for-profit competitors.

The Growing Importance of Cost Accounting for Hospitals.

Management scholars have identified several cost accounting methods that provide organizations with accurate estimates of the costs they incur in producing output. However, little is known about which of these methods are most commonly used by hospitals. This article examines the literature on the relative costs and benefits of different accounting methods and the scant literature describing which of these methods are most commonly used by hospitals. It goes on to suggest that hospitals have not adopted sophisticated cost accounting systems because characteristics of the hospital industry make the costs of doing so high and the benefits of service-level cost information relatively low. However, changes in insurance benefit design are creating incentives for patients to compare hospital prices. If these changes continue, hospitals' patient volumes and revenues may increasingly be dictated by the decisions of individual patients shopping for low-cost services and as a result, providers could see increasing pressure to set prices at levels that reflect the costs of providing care. If these changes materialize, cost accounting information will become a much more important part of hospital management than it has been in the past.

Capital Investment by Independent and System-Affiliated Hospitals.

Capital expenditures are a critical part of hospitals' efforts to maintain quality of patient care and financial stability. Over the past 20 years, finding capital to fund these expenditures has become increasingly challenging for hospitals, particularly independent hospitals. Independent hospitals struggling to find ways to fund necessary capital investment are often advised that their best strategy is to join a multi-hospital system. There is scant empirical evidence to support the idea that system membership improves independent hospitals' ability to make capital expenditures. Using data from the American Hospital Association and Medicare Cost Reports, we use difference-in-difference methods to examine changes in capital expenditures for independent hospitals that joined multi-hospital systems between 1997 and 2008. We find that in the first 5 years after acquisition, capital expenditures increase by an average of almost $16,000 per bed annually, as compared with non-acquired hospitals. In later years, the difference in capital expenditure is smaller and not statistically significant. Our results do not suggest that increases in capital expenditures vary by asset age or the size of the acquiring system.