Changes in Quality of Care after Hospital Mergers and Acquisitions.

BACKGROUND: The hospital industry has consolidated substantially during the past two decades and at an accelerated pace since 2010. Multiple studies have shown that hospital mergers have led to higher prices for commercially insured patients, but research about effects on quality of care is limited. METHODS: Using Medicare claims and Hospital Compare data from 2007 through 2016 on performance on four measures of quality of care (a composite of clinical-process measures, a composite of patient-experience measures, mortality, and the rate of readmission after discharge) and data on hospital mergers and acquisitions occurring from 2009 through 2013, we conducted difference-in-differences analyses comparing changes in the performance of acquired hospitals from the time before acquisition to the time after acquisition with concurrent changes for control hospitals that did not have a change in ownership. RESULTS: The study sample included 246 acquired hospitals and 1986 control hospitals. Being acquired was associated with a modest differential decline in performance on the patient-experience measure (adjusted differential change, -0.17 SD; 95% confidence interval [CI], -0.26 to -0.07; P = 0.002; the change was analogous to a fall from the 50th to the 41st percentile) and no significant differential change in 30-day readmission rates (-0.10 percentage points; 95% CI, -0.53 to 0.34; P = 0.72) or in 30-day mortality (-0.03 percentage points; 95% CI, -0.20 to 0.14; P = 0.72). Acquired hospitals had a significant differential improvement in performance on the clinical-process measure (0.22 SD; 95% CI, 0.05 to 0.38; P = 0.03), but this could not be attributed conclusively to a change in ownership because differential improvement occurred before acquisition. CONCLUSIONS: Hospital acquisition by another hospital or hospital system was associated with modestly worse patient experiences and no significant changes in readmission or mortality rates. Effects on process measures of quality were inconclusive. (Funded by the Agency for Healthcare Research and Quality.).

Nearly half of all Medicare hospice enrollees received care from agencies owned by regional or national chains.

Analyses of ownership in the US hospice sector have focused on the growth of for-profit hospice care and on aggregate differences in patient populations and service use patterns between for-profit and not-for-profit agencies. Such comparisons, although useful, do not offer insights about the types of organizations within the hospice sector, including the emergence of multiagency chains. Using Medicare cost report data for the period 2000-11, we tracked the evolution of the US hospice industry. We not only describe the market's composition by profit status but also provide new information about the roles of regional and national chains. Almost half of all Medicare hospice enrollees in 2011 received hospice services from a multiagency chain. A handful of companies play a prominent role, although the presence of smaller for-profit and not-for-profit hospice chains also has grown in recent years. By focusing on the role of the diverse organizations that provide hospice care, our analyses can help inform efforts to monitor and assure quality of care, to assess payment adequacy and options for reform, and to facilitate greater transparency and accountability within the hospice marketplace.

Geographic variation in cancer-related imaging: Veterans Affairs health care system versus Medicare.

BACKGROUND: Geographic variations in use of medical services have been interpreted as indirect evidence of wasteful care. Less overuse of services, however, may not be reliably associated with less geographic variation. OBJECTIVE: To compare average use and geographic variation in use of cancer-related imaging between fee-for-service Medicare and the Department of Veterans Affairs (VA) health care system. DESIGN: Observational analysis of cancer-related imaging from 2003 to 2005 using Medicare and VA utilization data linked to cancer registry data. Multilevel models, adjusted for sociodemographic and tumor characteristics, were used to estimate mean differences in annual imaging use between cohorts of Medicare and VA patients within geographic areas and variation in use across areas for each cohort. SETTING: 40 hospital referral regions. PATIENTS: Older men with lung, colorectal, or prostate cancer, including 34,475 traditional Medicare beneficiaries (Medicare cohort) and 6835 VA patients (VA cohort). MEASUREMENTS: Per-patient count of imaging studies for which lung, colorectal, or prostate cancer was the primary diagnosis (each study weighted by a standardized price), and a direct measure of overuse-advanced imaging for prostate cancer at low risk for metastasis. RESULTS: Adjusted annual use of cancer-related imaging was lower in the VA cohort than in the Medicare cohort (price-weighted count, $197 vs. $379 per patient; P < 0.001), as was annual use of advanced imaging for prostate cancer at low risk for metastasis ($41 vs. $117 per patient; P < 0.001). Geographic variation in cancer-related imaging use was similar in magnitude in the VA and Medicare cohorts. LIMITATION: Observational study design. CONCLUSION: Use of cancer-related imaging was lower in the VA health care system than in fee-for-service Medicare, but lower use was not associated with less geographic variation. Geographic variation in service use may not be a reliable indicator of the extent of overuse. PRIMARY FUNDING SOURCE: Doris Duke Charitable Foundation and Department of Veterans Affairs Office of Policy and Planning.

Drug plan design incentives among Medicare prescription drug plans.

OBJECTIVE: Medicare Advantage prescription drug plans (MA-PDs) and standalone prescription drug plans (PDPs) face different incentives for plan design resulting from the scope of covered benefits (only outpatient drugs for PDPs versus all drug and nondrug services for Medicare Advantage [MA]/MA-PDs). The objective is to begin to explore how MA-PDs and PDPs may be responding to their different incentives related to benefit design. STUDY DESIGN: We compared 2012 PDP and MA-PD average formulary coverage, prior authorization (PA) or step therapy use, and copayment requirements for drugs in 6 classes used commonly among Medicare beneficiaries. DATA: We primarily used 2012 Prescription Drug Plan Formulary and Pharmacy Network Files and MA enrollment data. 2011 Truven Health MarketScan claims were used to estimate drug prices and to compute drug market share. Average coverage and PA/step rates, and average copayment requirements, were weighted by plan enrollment and drug market share. RESULTS: MA-PDs are generally more likely to cover and less likely to require PA/step for brand name drugs with generic alternatives than PDPs, and MA-PDs often have lower copayment requirements for these drugs. For brands without generics, we generally found no differences in average rates of coverage or PA/step, but MA-PDs were more likely to cover all brands without generics in a class. CONCLUSIONS: We found modest, confirmatory evidence suggesting that PDPs and MA-PDs respond to different incentives for plan design. Future research is needed to understand the factors that influence Medicare drug plan design decisions.

Outpatient care patterns and organizational accountability in Medicare.

IMPORTANCE: Fostering accountability in the Medicare Accountable Care Organization (ACO) programs may be challenging because traditional Medicare beneficiaries have unrestricted choice of health care providers, are attributed to ACOs based on utilization, and often receive fragmented care. OBJECTIVE: To measure 3 related constructs relevant to ACO incentives and their capacity to manage care: stability of patient assignment, leakage of outpatient care, and contract penetration. DESIGN, SETTING, AND PARTICIPANTS: Using 2010-2011 Medicare claims and rosters of physicians in organizations participating in ACO programs, we examined these constructs among 524,246 beneficiaries hypothetically assigned to 145 ACOs prior to the start of the Medicare ACO programs. We compared estimates by patient complexity, ACO size, and the primary care orientation of ACO specialty mix. MAIN OUTCOMES AND MEASURES: Three related construct measurements: stability of assignment, defined as the proportion of patients whose assignment to an ACO in 2010 was unchanged in 2011; leakage of outpatient care, defined as the proportion of office visits for an assigned population that occurred outside of the contracting organization; and contract penetration, defined as the proportion of Medicare outpatient spending billed by an ACO that was devoted to assigned patients. RESULTS: Of beneficiaries assigned to an ACO in 2010, 80.4% were assigned to the same ACO in 2011. Of those assigned to an ACO in 2010 or 2011, 66.0% were consistently assigned in both years. Unstable assignment was more common among beneficiaries with fewer conditions and office visits but also among those in several high-cost categories, including the highest decile of per-beneficiary spending. Among ACO-assigned beneficiaries, 8.7% of office visits with primary care physicians were provided outside of the assigned ACO, and 66.7% of office visits with specialists were provided outside of the assigned ACO. Leakage of outpatient specialty care was greater for higher-cost beneficiaries and substantial even among specialty-oriented ACOs (54.6% for lowest quartile of primary care orientation). Of Medicare spending on outpatient care billed by ACO physicians, 37.9% was devoted to assigned beneficiaries. This proportion was higher for ACOs with greater primary care orientation (60.0% for highest quartile vs 33.6% for lowest). CONCLUSIONS AND RELEVANCE: Care patterns among beneficiaries served by ACOs suggest distinct challenges in achieving organizational accountability in Medicare. Continued monitoring of these patterns may be important to determine the regulatory need for enhancing ACOs' incentives and their ability to improve care efficiency.