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Does financial integration between hospitals and post-acute care facilities affect episode-based care patterns and costs?
Study Design: We used a novel method to identify financial integration between acute care hospitals with PAC facilities, including skilled nursing facilities (SNF), home health agency (HHA), rehabilitation facilities, and hospice sectors, by linking the Value-Based Payment Modifier File for Quality and Resource Use Reports (QRURs) with the Provider Enrollment, Chain, and Ownership System (PECOS) of the Centers for Medicare and Medicaid Services. We estimate the effects of financial integration on episode-based total costs, inpatient care costs, readmission rate and costs, and PAC use and costs. We use instrumental variable approach to address the selection bias on hospital choice. All models are at Medicare beneficiary level and adjusted for patient’s risk factors, provider’s attributes, and geographic variations. We studied the 100% sample of Medicare Part A and Part B beneficiaries who received inpatient care in 2015.
Principal Findings: We find that 66% of the Medicare beneficiaries who received inpatient care in 2015 were treated in the hospitals that financially integrated with at least one type of PAC facilities. Patients used more PAC services per episode if they were treated in the hospitals that financially integrated with PAC facilities. Higher PAC MSPB costs were primarily driven by more Skilled Nursing Facility services use and costs. However, total MSPB costs, inpatient care costs, and readmission rate and costs were lower among patients of hospitals that financially with PAC facilities. The findings suggest that financial integration between acute-care hospitals and PAC facilities might help to lower episode-based acute-care costs. More attention should be paid on patients’ unmet need on receiving right post-acute care when providers are undergoing organizational changes.
