Market and organizational factors associated with hospital vertical integration into sub-acute care.

BACKGROUND: Changes in payment models incentivize hospitals to vertically integrate into sub-acute care (SAC) services. Through vertical integration into SAC, hospitals have the potential to reduce the transaction costs associated with moving patients throughout the care continuum and reduce the likelihood that patients will be readmitted. PURPOSE: The purpose of this study is to examine the correlates of hospital vertical integration into SAC. METHODOLOGY/APPROACH: Using panel data of U.S. acute care hospitals (2008-2012), we conducted logit regression models to examine environmental and organizational factors associated with hospital vertical integration. Results are reported as average marginal effects. FINDINGS: Among 3,775 unique hospitals (16,269 hospital-year observations), 25.7% vertically integrated into skilled nursing facilities during at least 1 year of the study period. One measure of complexity, the availability of skilled nursing facilities in a county (ME = -1.780, p < .001), was negatively associated with hospital vertical integration into SAC. Measures of munificence, percentage of the county population eligible for Medicare (ME = 0.018, p < .001) and rural geographic location (ME = 0.069, p < .001), were positively associated with hospital vertical integration into SAC. Dynamism, when measured as the change county population between 2008 and 2011 (ME = 1.19e-06, p < .001), was positively associated with hospital vertical integration into SAC. Organizational resources, when measured as swing beds (ME = 0.069, p < .001), were positively associated with hospital vertical integration into SAC. Organizational resources, when measured as investor owned (ME = -0.052, p < .1) and system affiliation (ME = -0.041, p < .1), were negatively associated with hospital vertical integration into SAC. PRACTICE IMPLICATIONS: Hospital adaption to the changing health care landscape through vertical integration varies across market and organizational conditions. Current Centers for Medicare and Medicaid reimbursement programs do not take these factors into consideration. Vertical integration strategy into SAC may be more appropriate under certain market conditions. Hospital leaders may consider how to best align their organization's SAC strategy with their operating environment.

Hospital Vertical Integration Into Subacute Care as a Strategic Response to Value-Based Payment Incentives, Market Factors, and Organizational Factors: A Multiple-Case Study.

This study explores the extent to which payment reform and other factors have motivated hospitals to adopt a vertical integration strategy. Using a multiple-case study research design, we completed case studies of 3 US health systems to provide an in-depth perspective into hospital adoption of subacute care vertical integration strategies across multiple types of hospitals and in different health care markets. Three major themes associated with hospital adoption of vertical integration strategies were identified: value-based payment incentives, market factors, and organizational factors. We found evidence that variation in hospital adoption of vertical integration into subacute care strategies occurs in the United States and gained a perspective on the intricacies of how and why hospitals adopt a vertical integration into subacute care strategy.

Cost Analysis of an Advanced Practice Registered Nurse Transitional Care Model for Cardiac Patients.

Interest in care transitions has intensified in light of emphasis placed on hospital readmissions. This study provides a comparative analysis of the costs of providing transitional care through a program for cardiac patients against hospital readmission costs. The advanced practice registered nurse-managed BRIDGE model reduced health care costs associated with readmissions that were in excess of program costs. On average, there was a per-patient savings of $4,944 in avoided readmissions within 30 days of hospital discharge. Over the duration of the program, this equates to a $306,537 savings in patients with acute coronary syndrome. Nurse practitioners have a unique, holistic, and supportive approach to providing care that may make them ideal for the transitional care setting.