Trends in Hospital Lawsuits Filed Against Patients for Unpaid Bills Following Published Research About This Activity.

Importance: Suing patients and garnishing their wages for unpaid medical bills can be a predatory form of financial activity that may be inconsistent with the mission of a hospital. Many hospitals in the state of Virginia were discovered to be suing patients for unpaid medical bills, as first presented in a 2019 research article that launched 2.5 months of media attention on hospital billing practices and a grassroots public demand for hospitals to stop the practice. Objective: To evaluate the association of a research publication and subsequent media coverage with the number of hospital lawsuits filed against patients for unpaid medical bills. Design, Setting, and Participants: This cross-sectional study of Virginia hospitals that sued patients for unpaid medical bills used an interrupted time series analysis. Data on hospitals suing patients for unpaid medical bills were collected during a preintervention period (June 25, 2018, to June 24, 2019), an intervention period (June 25, 2019, to September 10, 2019), and a postintervention period (September 11, 2019, to September 10, 2020). Exposures: Publication of a research article and subsequent media coverage. Main Outcomes and Measures: The total number of warrant in debt and wage garnishment lawsuits filed by Virginia hospitals and the frequency of those lawsuits filed before, during, and after the intervention period on a weekly basis. Results: A total of 50 387 lawsuits, filed by 67 Virginia hospitals, were included; 33 204 (65.9%) were warrant in debt lawsuits, and 17 183 (34.1%) were wage garnishment lawsuits. From the preintervention period to the postintervention period, there was a 59% decrease in the number of lawsuits filed (from 30 760 lawsuits to 12 510 lawsuits), a 55% decrease in the number of warrant in debt cases filed (from 19 329 to 8651), a 66% decrease in the number of wage garnishments filed (from 11 431 to 3859), and a 64% decrease in the dollar amount pursued in court (from $38 700 209 to $13 960 300). During the study period, 11 hospitals banned the practice of suing patients for unpaid medical bills. The interrupted time series analysis showed a significant decrease of 5% (incidence rate ratio, 0.95; 95% CI, 0.94-0.96) in the total weekly number of lawsuits in the postintervention period. Conclusions and Relevance: The findings of this study suggest that research leading to public awareness can shift hospital billing practices.

Assessment of the Financial Health of Rural Hospitals After Implementation of the Georgia Rural Hospital Tax Credit Program.

Importance: In 2016, Georgia implemented the Rural Hospital Tax Credit Program, which allows taxpayers to receive a tax credit for contributions to qualifying rural hospitals in the state. Empirical evidence of the program's association with the viability of the state's rural hospitals is needed. Objective: To examine the association of the tax credit program with the financial health of participating rural hospitals. Design, Setting, and Participants: This longitudinal cross-sectional study used hospital financial data from the Centers for Medicare & Medicaid Services for 2015 to 2019. A difference-in-differences analytic approach was used to examine the association of the tax credit program with rural hospital financial health. Study participants included Georgia rural hospitals eligible to participate in the program. Comparison hospitals were selected from the southern states of Alabama, Florida, Mississippi, North Carolina, South Carolina, and Tennessee. Exposures: Hospital participation in the Georgia Rural Hospital Tax Credit Program. Main Outcomes and Measures: The primary outcome of the study was financial health measured with total margin, days cash on hand, debt-asset ratio, and average age of plant as well as a Financial Strength Index (FSI), which combined the previous measures to assess overall financial strength. Results: The analytical sample included a balanced panel of 136 hospitals, with 47 Georgia Rural Hospital Tax Credit Program participants (18 [38%] critical access hospitals; 5 [11%] system affiliated; mean [SD] bed count, 60 [47]; mean [SD] Medicare inpatient mix, 52% [16]) and 89 comparison hospitals (43 [48%] critical access hospitals; 24 [27%] system affiliated; mean [SD] bed count, 52 [41]; mean [SD] Medicare inpatient mix, 67% [18]). Two years after implementation, program participation was associated with a 23% increased probability of good or excellent financial health (b = 0.23; 95% CI, 0.10-0.37; P < .001) and a 6.7-point increase in total margin (b = 6.67; 95% CI, 3.61-9.73; P < .001). Conclusions and Relevance: These early findings suggest that the Georgia Rural Hospital Tax Credit Program is associated with improvements in hospital financial health; however, additional studies are needed to assess the program's long-term impact on the financial sustainability of Georgia's rural hospitals.

Resource-based view on safety culture's influence on hospital performance: The moderating role of electronic health record implementation.

BACKGROUND: Patient safety and safety culture have received increasing attention from agencies such as the Agency of Healthcare Research and Quality and the Institute of Medicine. Safety culture refers to the fundamental values, attitudes, and perceptions that provide a unique source of competitive advantage to improve performance. This study contributes to the literature and expands understanding of safety culture and hospital performance outcomes when considering electronic health record (EHR) usage. PURPOSE: Based on the resource-based view of the firm, this study examined the association between safety culture and hospital quality and financial performance in the presence of EHR. METHODOLOGY/APPROACH: Data consist of the 2016 Hospital Survey on Patient Safety, Hospital Compare, American Hospital Association's annual survey, and the American Hospital Association's Information Technology supplement. Our final analytic sample consisted of 154 hospitals. We used a two-part nested regression model approach. RESULTS/CONCLUSION: Safety culture has a direct positive relationship with financial performance (operating margin). Furthermore, having basic EHR as compared to not having EHR further enhances this positive relationship. On the other hand, safety culture does not have a direct association with quality performance (readmissions) in most cases. However, safety culture coupled with basic EHR functionalities, compared to not having EHR, is associated with lower readmissions. PRACTICE IMPLICATIONS: Hospitals should strive to improve patient safety culture as part of their strategic plan for quality improvement. In addition, hospital managers should consider implementing EHR as a resource that can support safety culture's effect on outcomes such as financial and quality performance indicators. Future studies can examine the differences between basic and advanced EHR presence in relation to safety culture.

Community Benefit Spending Among North Carolina's Tax-Exempt Hospitals After Performing Community Health Needs Assessments.

CONTEXT: As of March 23, 2012, the Internal Revenue Service (IRS) requires tax-exempt hospitals to conduct Community Health Needs Assessment (CHNA) every 3 years to incentivize hospitals to provide programs responsive to the health needs of their communities. OBJECTIVE: To examine the distribution and variation in community benefit spending among North Carolina's tax-exempt hospitals 2 years after completing their first IRS-mandated CHNA. DESIGN: Cross-sectional study using secondary analysis of published community benefit reports. Community benefit was categorized on the basis of North Carolina Hospital Association's community benefit reporting guidelines. Multiple regression analysis using generalized linear model was used to examine the variation in community benefit spending among study hospitals considering differences in hospital-level and community characteristics. SETTING: Fifty-three private, nonprofit hospitals across North Carolina. MAIN OUTCOME MEASURE: Dollar expenditures as a percentage of operating expenses of the 2 categories of community benefit spending: patient care financial assistance and community health programs. RESULTS: Study hospitals' aggregate community benefit spending was $2.6 billion, 85% of which was in the form of patient care financial assistance, with only 0.7% of total spending allocated to community-building activities such as affordable housing, economic development, and environmental improvements. On average, the study hospitals' community benefit spending was equivalent to 14.6% of operating expenses. Hospitals with 300 or more beds provided significantly higher investments in community health programs as a percentage of their operating expenses than hospitals with 101 to 299 beds (P = .03) or hospitals with 100 or fewer beds (P = .04). Access to care was not associated with patient care financial assistance (P = .81) or community health programs expenditures (P = .94). CONCLUSIONS: The study hospitals direct most of their community benefit expenditures to patient care financial assistance (individual welfare) rather than population health improvement initiatives, with virtually no investments in community-building activities that address socioeconomic determinants of health.

Hospitals' use of hospitalists: Implications for financial performance.

BACKGROUND: Hospitalists, or physicians specializing in hospital-based practice, have grown significantly since they were first introduced in the United States in the mid-1990s. Prior studies on the impact of hospitalists have focused on costs and length of stay. However, there is dearth of research exploring the relationship between hospitals' use of hospitalists and organizational performance. PURPOSE: Using a national longitudinal sample of acute care hospitals operating in the United States between 2007 and 2014, this study explores the impact of hospitalists staffing intensity on hospitals' financial performance. METHODOLOGY: Data sources for this study included the American Hospital Association Annual Survey, the Area Health Resources File, and the Centers for Medicare & Medicaid Services' costs reports and Case Mix Index files. Data were analyzed using a panel design with facility and year fixed effects regression. RESULTS: Results showed that hospitals that switched from not using hospitalists to using a high hospitalist staffing intensity had both increased patient revenues and higher operating costs per adjusted patient day. However, the higher operating costs from high hospitalist staffing intensity were offset by increased patient revenues, resulting in a marginally significant increase in operating profitability (p < .1). PRACTICE IMPLICATIONS: These findings suggest that the rise in the use of hospitalists may be fueled by financial incentives such as increased revenues and profitability in addition to other drivers of adoption.

Analysis of Factors Influencing Hospitals' Implementation of a Green E-Procurement System Using a Cloud Model.

Currently, the green procurement activities of private hospitals in Taiwan follow the self-built green electronic-procurement (e-procurement) system. This requires professional personnel to take the time to regularly update the green specification and software and hardware of the e-procurement system, and the information system maintenance cost is high. In the case of a green e-procurement system crash, the efficiency of green procurement activities for hospitals is affected. If the green e-procurement can be moved to a convenient and trusty cloud computing model, this will enhance the efficiency of procurement activities and reduce the information maintenance cost for private hospitals. However, implementing a cloud model is an issue of technology innovation application and the technology-organization-environment (TOE) framework has been widely applied as the theoretical framework in technology innovation application. In addition, finding the weight of factors is a multi-criteria decision-making (MCDM) issue. Therefore, the present study first collected factors influencing implementation of the cloud mode together with the TOE as the theoretical framework, by reviewing the literature. Therefore, an expert questionnaire was designed and distributed to top managers of 20 private hospitals in southern Taiwan. The fuzzy analysis hierarchical process (FAHP), which is a MCDM tool, finds the weights of the factors influencing private hospitals in southern Taiwan when they implement a cloud green e-procurement system. The research results can enable private hospitals to successfully implement a green e-procurement system through a cloud model by optimizing resource allocation according to the weight of each factor. In addition, the results of this research can help cloud service providers of green e-procurement understand users' needs and develop relevant cloud solutions and marketing strategies.

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.

Hospital Capital Investment During the Great Recession.

Hospital capital investment is important for acquiring and maintaining technology and equipment needed to provide health care. Reduction in capital investment by a hospital has negative implications for patient outcomes. Most hospitals rely on debt and internal cash flow to fund capital investment. The great recession may have made it difficult for hospitals to borrow, thus reducing their capital investment. I investigated the impact of the great recession on capital investment made by California hospitals. Modeling how hospital capital investment may have been liquidity constrained during the recession is a novel contribution to the literature. I estimated the model with California Office of Statewide Health Planning and Development data and system generalized method of moments. Findings suggest that not-for-profit and public hospitals were liquidity constrained during the recession. Comparing the changes in hospital capital investment between 2006 and 2009 showed that hospitals used cash flow to increase capital investment by $2.45 million, other things equal.

Patient experience and hospital profitability: Is there a link?

BACKGROUND: Patient experience has had a direct financial impact on hospitals since value-based purchasing was instituted by the Centers for Medicare & Medicaid Services in 2013 as a method to reward or punish hospitals based on performance on various measures, including patient experience. Although other industries have shown an indirect impact of customer experience on overall profitability, that link has not been well established in the health care industry. Return-to-provider rate and perceptions of health quality have been associated with profitability in the health care industry. PURPOSE: Our aims were to assess whether, independent of a direct financial impact, a more positive patient experience is associated with increased profitability and whether a more negative patient experience is associated with decreased profitability. METHODOLOGY/APPROACH: We used a sample of 19,792 observations from 3767 hospitals over the 6-year period 2007-2012. The data were sourced from Centers for Medicare & Medicaid Services and Hospital Consumer Assessment of Healthcare Providers and Systems. Using generalized estimating equations to account for repeated measures, we fit four separate models for three dependent variables: net patient revenue, net income, and operating margin. Each model included one of the following independent variables of interest: percentage of patients who definitely recommend the hospital, percentage of patients who definitely would not recommend the hospital, percentage of patients who rated the hospital 9 or 10, and percentage of patients who rated the hospital 6 or lower. FINDINGS: We identified that a positive patient experience is associated with increased profitability and a negative patient experience is even more strongly associated with decreased profitability. PRACTICE IMPLICATIONS: Management should have greater justification for incurring costs associated with bolstering patient experience programs. Improvements in training, technology, and staffing can be justified as a way to improve not only quality but now profitability as well.

The impact of HTA and procurement practices on the selection and prices of medical devices.

Technological innovation in healthcare yields better health outcomes but also drives healthcare expenditure, and governments are struggling to maintain an appropriate balance between patient access to modern care and the economic sustainability of healthcare systems. Health Technology Assessment (HTA) and centralized procurement are increasingly used to govern the introduction and diffusion of new technologies in an effort to make access to innovation financially sustainable. However, little empirical evidence is available to determine how they affect the selection of new technologies and unit prices. This paper focuses on medical devices (MDs) and investigates the combined effect of various HTA governance models and procurement practices on the two steps of the MD purchasing process (i.e., selecting the product and setting the unit price). Our analyses are based on primary data collected through a national survey of Italian public hospitals. The Italian National Health Service is an ideal case study because it is highly decentralized and because regions have adopted different HTA governance models (i.e., regional, hospital-based, double-level or no HTA), often in combination with centralized regional procurement programs. Hence, the Italian case allows us to test the impact of different combinations of HTA models and procurement programs in the various regions. The results show that regional HTA increases the probability of purchasing the costliest devices, whereas hospital-based HTA functions more like a cost-containment unit. Centralized regional procurement does not significantly affect MD selection and is associated with a reduction in the MD unit price: on average, hospitals located in regions with centralized procurement pay 10.1% less for the same product. Hospitals located in regions with active regional HTA programs pay higher prices for the same device (+23.2% for inexpensive products), whereas hospitals that have developed internal HTA programs pay 8.3% on average more for the same product.

User's Satisfaction of Multiple Accounting Record System.

UNLABELLED: The study hospital had developed a multiple account recording system that generates the accounting information of the consumed materials based on daily nursing records. A questionnaire survey was delivered to further investigate the impact of the system. METHODS: Four concepts of the system were investigated. (1) Supportive and time saving; (2) impact on workflows and job satisfactions; (3) ease of use; and (4) overall satisfactions. RESULTS: The system scored 4.03 out of 5 as the highest for helpfulness for daily practices, 3.98 for decrease the time for recording material consumptions, 3.98 for actually changed the way they work. DISCUSSION: Users mostly expressed positive attitude towards the system.

Factors affecting the technical efficiency of general hospitals in Iran: data envelopment analysis.

BACKGROUND: Restrictions on resource accessibility and its optimal application is the main challenge in organizations nowadays. The aim of this research was to study the technical efficiency and its related factors in Tehran general hospitals. MATERIALS AND METHODS: This descriptive analytical study was conducted retrospectively in 2014. Fifty-four hospitals with private, university, and social security ownerships from the total 110 general hospitals were randomly selected for inclusion into this study on the basis of the share of ownership. Data were collected using a checklist with three sections, including background variables, inputs, and outputs. RESULTS: Seventeen (31.48%) hospitals had an efficiency score of 1 (highest efficiency score). The highest average efficiency score was in social security hospitals (84.32). Private and university hospitals ranked next with an average of 84.29 and 79.64, respectively. Analytical results showed that there was a significant relationship between hospital ownership, hospital type in terms of duty and specialization, educational field of the chief executive officer, and technical efficiency. There was no significant relationship between education level of hospital manager and technical efficiency. CONCLUSION AND RECOMMENDATIONS: Most of the studied hospitals were operating at low efficiency. Therefore, policymakers should plan to improve the hospital operations and promote hospitals to an optimal level of efficiency.

Rising Billing for Intermediate Intensive Care among Hospitalized Medicare Beneficiaries between 1996 and 2010.

RATIONALE: Intermediate care (i.e., step-down or progressive care) is an alternative to the intensive care unit (ICU) for patients with moderate severity of illness. The adoption and current use of intermediate care is unknown. OBJECTIVES: To characterize trends in intermediate care use among U.S. hospitals. METHODS: We examined 135 million acute care hospitalizations among elderly individuals (≥65 yr) enrolled in fee-for-service Medicare (U.S. federal health insurance program) from 1996 to 2010. We identified patients receiving intermediate care as those with intensive care or coronary care room and board charges labeled intermediate ICU. MEASUREMENTS AND MAIN RESULTS: In 1996, a total of 960 of the 3,425 hospitals providing critical care billed for intermediate care (28%), and this increased to 1,643 of 2,783 hospitals (59%) in 2010 (P < 0.01). Only 8.2% of Medicare hospitalizations in 1996 were billed for intermediate care, but billing steadily increased to 22.8% by 2010 (P < 0.01), whereas the percentage billed for ICU care and ward-only care declined. Patients billed for intermediate care had more acute organ failures diagnoses codes compared with general ward patients (22.4% vs. 15.8%). When compared with patients billed for ICU care, those billed for intermediate care had fewer organ failures (22.4% vs. 43.4%), less mechanical ventilation (0.9% vs. 16.7%), lower mean Medicare spending ($8,514 vs. $18,150), and lower 30-day mortality (5.6% vs. 16.5%) (P < 0.01 for all comparisons). CONCLUSIONS: Intermediate care billing increased markedly between 1996 and 2010. These findings highlight the need to better define the value, specific practices, and effective use of intermediate care for patients and hospitals.

Association between payer mix and costs, revenues and profitability: a cross-sectional study of Lebanese hospitals.

This study aimed to examine the association between the payer mix and the financial performance of public and private hospitals in Lebanon. The sample comprised 24 hospitals, representing the variety of hospital characteristics in Lebanon. The distribution of the payer mix revealed that the main sources of revenue were public sources (61.1%), out-of-pocket (18.4%) and private insurance (18.2%). Increases in the percentage of revenue from public sources were associated with lower total costs and revenues, but not profit margins. An inverse association was noted between increased revenue from private insurance and profitability, attributed to increased costs. Increased percentage of out of- pocket payments was associated with lower costs and higher profitability. The study provides evidence that payer mix is associated with hospital costs, revenues and profitability. This should initiate/inform discussions between public and private payers and hospitals about the level of payment and its association with hospital sector financial viability.

Disparities in Colorectal Cancer Treatment Delay Within Appalachia--The Role of For-Profit Hospitals.

BACKGROUND: Appalachian residents have a higher overall cancer burden than the rest of the United States because of the unique features of the region. Treatment delays vary widely within Appalachia, with colorectal cancer patients undergoing median treatment delays of 5 days in Kentucky compared to 9 days for patients in Pennsylvania, Ohio, and North Carolina combined. OBJECTIVE: This study identified the source of this disparity in treatment delay using statistical decomposition techniques. METHODOLOGY: This study used linked 2006 to 2008 cancer registry and Medicare claims data for the Appalachian counties of Kentucky, Pennsylvania, Ohio, and North Carolina to estimate a 2-part model of treatment delay. An Oaxaca Decomposition of the 2-part model revealed the contribution of the individual determinants to the disparity in delay between Kentucky counties and the remaining 3 states. RESULTS: The Oaxaca Decomposition revealed that the higher percentage of patients treated at for-profit facilities in Kentucky proved the key contributor to the observed disparity. In Kentucky, 22.3% patients began their treatment at a for-profit facility compared to 1.4% in the remaining states. Patients initiating treatment at for-profit facilities explained 79% of the observed difference in immediate treatment (<2 days after diagnosis) and 72% of Kentucky's advantage in log days to treatment. CONCLUSIONS: The unique role of for-profit facilities led to reduced treatment delay for colorectal cancer patients in Kentucky. However, it remains unknown whether for-profit hospitals' more rapid treatment converts to better health outcomes for colorectal cancer patients.

Hospital closures had no measurable impact on local hospitalization rates or mortality rates, 2003-11.

The Affordable Care Act (ACA) set in motion payment changes that could put pressure on hospital finances and lead some hospitals to close. Understanding the impact of closures on patient care and outcomes is critically important. We identified 195 hospital closures in the United States between 2003 and 2011. We found no significant difference between the change in annual mortality rates for patients living in hospital service areas (HSAs) that experienced one or more closures and the change in rates in matched HSAs without a closure (5.5 percent to 5.2 percent versus 5.4 percent to 5.4 percent, respectively). Nor was there a significant difference in the change in all-cause mortality rates following hospitalization (9.1 percent to 8.2 percent in HSAs with a closure versus 9.0 percent to 8.4 percent in those without a closure). HSAs with a closure had a drop in readmission rates compared to controls (19.4 percent to 18.2 percent versus 18.8 percent to 18.3 percent). Overall, we found no evidence that hospital closures were associated with worse outcomes for patients living in those communities. These findings may offer reassurance to policy makers and clinical leaders concerned about the potential acceleration of hospital closures as a result of health care reform.

Performing well in financial management and quality of care: evidence from hospital process measures for treatment of cardiovascular disease.

BACKGROUND: Fiscal constraints faced by U.S. hospitals as a result of the recent economic downturn are leading to business practices that reduce costs and improve financial and operational efficiency in hospitals. There naturally arises the question of how this finance-driven management culture could affect the quality of care. This paper attempts to determine whether the process measures of treatment quality are correlated with hospital financial performance. METHODS: Panel study of hospital care quality and financial condition between 2005 and 2010 for cardiovascular disease treatment at acute care hospitals in the United States. Process measures for condition-specific treatment of heart attack and heart failure and hospital-level financial condition ratios were collected from the CMS databases of Hospital Compare and Cost Reports. RESULTS: There is a statistically significant relationship between hospital financial performance and quality of care. Hospital profitability, financial leverage, asset liquidity, operating efficiency, and costs appear to be important factors of health care quality. In general, public hospitals provide lower quality care than their nonprofit counterparts, and urban hospitals report better quality score than those located in rural areas. Specifically, the first-difference regression results indicate that the quality of treatment for cardiovascular patients rises in the year following an increase in hospital profitability, financial leverage, and labor costs. CONCLUSIONS: The results suggest that, when a hospital made more profit, had the capacity to finance investment using debt, paid higher wages presumably to attract more skilled nurses, its quality of care would generally improve. While the pursuit of profit induces hospitals to enhance both quantity and quality of services they offer, the lack of financial strength may result in a lower standard of health care services, implying the importance of monitoring the quality of care among those hospitals with poor financial health.

Does a global budget superimposed on fee-for-service payments mitigate hospitals' medical claims in Taiwan?

Taiwan's global budgeting for hospital health care, in comparison to other countries, assigns a regional budget cap for hospitals' medical benefits claimed on the basis of fee-for-service (FFS) payments. This study uses a stays-hospitals-years database comprising acute myocardial infarction inpatients to examine whether the reimbursement policy mitigates the medical benefits claimed to a third-payer party during 2000-2008. The estimated results of a nested random-effects model showed that hospitals attempted to increase their medical benefit claims under the influence of initial implementation of global budgeting. The magnitudes of hospitals' responses to global budgeting were significantly attributed to hospital ownership, accreditation status, and market competitiveness of a region. The results imply that the regional budget cap superimposed on FFS payments provides only blunt incentive to the hospitals to cooperate to contain medical resource utilization, unless a monitoring mechanism attached with the payment system.