The effects of vertically integrated care on health care use and outcomes in inpatient rehabilitation facilities.

OBJECTIVE: To understand the effects of receiving vertically integrated care in inpatient rehabilitation facilities (IRFs) on health care use and outcomes. DATA SOURCES: Medicare enrollment, claims, and IRF patient assessment data from 2012 to 2014. STUDY DESIGN: We estimated within-IRF differences in health care use and outcomes between IRF patients admitted from hospitals vertically integrated with the IRF (parent hospital) vs patients admitted from other hospitals. For hospital-based IRFs, the parent hospital was defined as the hospital that owned the IRF and co-located with the IRF. For freestanding IRFs, the parent hospital(s) was defined as the hospital(s) that was in the same health system. We estimated models for freestanding and hospital-based IRFs and for fee-for-service (FFS) and Medicare Advantage (MA) patients. Dependent variables included hospital and IRF length of stay, functional status, discharged to home, and hospital readmissions. DATA EXTRACTION METHODS: We identified Medicare beneficiaries discharged from a hospital to IRF. PRINCIPAL FINDINGS: In adjusted models with hospital fixed effects, our results indicate that FFS patients in hospital-based IRFs discharged from the parent hospital had shorter hospital (-0.7 days, 95% CI: -0.9 to -0.6) and IRF (-0.7 days, 95% CI: -0.9 to -0.6) length of stay were less likely to be readmitted (-1.6%, 95% CI: -2.7% to -0.5%) and more likely to be discharged to home care (1.4%, 95% CI: 0.7% to 2.0%), without worse patient clinical outcomes, compared to patients discharged from other hospitals and treated in the same IRFs. We found similar results for MA patients. However, for patients in freestanding IRFs, we found little differences in health care use or patient outcomes between patients discharged from a parent hospital compared to patients from other hospitals. CONCLUSIONS: Our results indicate that receiving vertically integrated care in hospital-based IRFs shortens institutional length of stay while maintaining or improving health outcomes.