Association between physician-hospital integration and inpatient care delivery in accountable care organizations: An instrumental variable analysis.

OBJECTIVE: To investigate the relationship between physician-hospital integration within accountable care organizations (ACOs) and inpatient care utilization and expenditure. DATA SOURCES: The primary data were Massachusetts All-Payer Claims Database (2009-2013). STUDY SETTING: Fifteen provider organizations that entered a commercial ACO contract with a major private payer in Massachusetts between 2009 and 2013. STUDY DESIGN: Using an instrumental variable approach, the study compared inpatient care delivery between patients of ACOs demonstrating high versus low integration. We measured physician-hospital integration within ACOs by the proportion of primary care physicians in an ACO who billed for outpatient services with a place-of-service code indicating employment or practice ownership by a hospital. The study sample comprised non-elderly adults who had continuous insurance coverage and were attributed to one of the 15 ACOs. Outcomes of interest included total medical expenditure during an episode of inpatient care, length of stay (LOS) of the index hospitalization, and 30-day readmission. An inpatient episode was defined as 30, 45, and 60 days from the admission date. DATA COLLECTION/EXTRACTION METHODS: Not applicable. PRINCIPAL FINDINGS: The study examined 33,535 admissions from patients served by the 15 ACOs. Average medical expenditure within 30 days of admission was $24,601, within 45 days was $26,447, and within 60 days was $28,043. Average LOS was 3.5 days, and 5.4% of patients were readmitted within 30 days. Physician-hospital integration was associated with a 10.6% reduction in 30-day expenditure (95% CI, -15.1% to -5.9%). Corresponding estimates for 45 and 60 days were - 9.7% (95%CI, -14.2% to -4.9%) and - 9.6% (95%CI, -14.3% to -4.7%). Integration was associated with a 15.7% decrease in LOS (95%CI, -22.6% to -8.2%) but unrelated to 30-day readmission rate. CONCLUSIONS: Our instrumental variable analysis shows physician-hospital integration with ACOs was associated with reduced inpatient spending and LOS, with no evidence of elevated readmission rates.

Using Medicare data to measure vertical integration of hospitals and physicians.

Researchers, healthcare providers, and policy makers have become increasingly interested in the cost and quality effects of vertical integration (VI) between hospitals and physicians. However, tracking VI is often financially costly. Because the Medicare Data on Provider Practice and Specialty (MD-PPAS) annual dataset may be more cost-effective for researchers to access than private data sources, we examine the accuracy of MD-PPAS in identifying VI by comparing it to physician and hospital affiliations reported in Blue Cross Blue Shield Texas (BCBSTX) PPO claims data for 2014-2016. The BCBSTX data serve as a gold standard, because physician-hospital affiliations are based on the insurer's provider contract information. We merged the two datasets using the physician National Provider Identifier (NPI), then determined what percentage of physicians had the same Tax Identification Number (TIN) in both sources, and whether the TIN implied the physician belonged to a physician- or hospital-owned practice. We found that 71.3% of successfully matched NPIs reported the same TIN, and 95.1% of patient-level observations were attributed to organizations with the same ownership type in both datasets, regardless of TIN. We compared regression estimates of patient-level annual spending on an indicator variable for physician versus hospital ownership for the primary attributed physician and found that estimates were within one percentage point whether one determined VI based on the BCBSTX or the MD-PPAS data. The results suggest that MD-PPAS, which costs less to obtain than from a for-profit data source, can be used to reliably track VI between hospitals and physicians.

Provider accountability as a driving force towards physician-hospital integration: a systematic review.

BACKGROUND: Hospitals and physicians lie at the heart of our health care delivery system. In general, physicians provide medical care and hospitals the resources to deliver health care. In the past two decades many countries have adopted reforms in which provider financial risk bearing is increased. By making providers financially accountable for the delivered care integrated care delivery is stimulated. PURPOSE: To assess the evidence base supporting the relationship between provider financial risk bearing and physician-hospital integration and to identify the different types of methods used to measure physician-hospital integration to evaluate the functional value of these integrative models. RESULTS: Nine studies met the inclusion criteria. The evidence base is mixed and inconclusive. Our methodological analysis of previous research shows that previous studies have largely focused on the formal structures of physician-hospital arrangements as an indicator of physician-hospital integration. CONCLUSION: The link between provider financial risk bearing and physician-hospital integration can at this time be supported merely on the basis of theoretical insights of agency theory rather than empirical research. Physician-hospital integration measurement has concentrated on the prevalence of contracting vehicles that enables joint bargaining in a managed care environment but without realizing integration and cooperation between hospital and physicians. Therefore, we argue that these studies fail to shed light on the impact of risk shifting on the hospital-physician relationship accurately.