Analysis in Brief
Each online issue of Analysis in Brief (AIB) tackles an academic medicine research topic, and presents a two-page, easy-to-read snapshot of the AAMC’s data collection and research activities. Topics are selected through a peer-review process and support the association’s strategic research agenda. The reports not only present data, but also provide context on the issues, interpretation of results and trends, and discussion of the policy and practical implications of the results—all of which may help to facilitate institutional and policy improvements at medical schools and teaching hospitals.
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Hospital Characteristics and Performance on Medicare’s Pay-for-Performance Programs Among Major Teaching Hospitals
The Patient Protection and Affordable Care Act established three Medicare hospital quality performance programs designed to improve clinical outcomes, patient experience, and efficiency. Each program ties Medicare payment for health care services to hospital performance on a set of quality measures. Recent studies have raised concerns about program fairness, and one shows that major teaching hospitals, large hospitals, and hospitals that serve a larger share of low-income patients are more likely to receive penalties in Medicare’s pay-for-performance programs. This Analysis in Brief reviews whether there are differences in the characteristics of major teaching hospitals that financially perform better on the three programs compared with those that have larger penalties, to inform the discussion of unintended consequences of Medicare’s quality programs and help in the understanding of how these programs affect hospitals. Results provide evidence that even within the group of major teaching hospitals, there are several significant differences between hospitals that had better performance and hospitals that had poor performance in the Medicare hospital quality programs. From these, two themes emerge. First, a portion of major teaching hospitals have consistent penalties across all three programs. Second, hospitals with the highest penalties have a higher percentage of low-income patients compared with the top performers. Consistent with current literature, this analysis shows a relationship between treating more complex and low-SES patients and increasing odds of receiving penalties in Medicare’s pay-for-performance programs, even after controlling for teaching status. These results raise questions and concerns about the fairness of the program design and whether patient population characteristics are sufficiently adjusted for in quality measuring.
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