HHS Public Access Author manuscript Author Manuscript
JAMA Intern Med. Author manuscript; available in PMC 2016 January 05. Published in final edited form as: JAMA Intern Med. 2016 January 1; 176(1): 117–119. doi:10.1001/jamainternmed.2015.6261.
Spending in the Post-Acute Care Setting Accounts for a Sizeable Portion of Spending Associated with a Hospitalization Episode Anup Das, BA1, Edward C. Norton, PhD1, David C. Miller, MD, MPH2, and Lena M. Chen, MD, MS3
Author Manuscript
1Department
of Health Management and Policy, University of Michigan, Ann Arbor, MI
2Department
of Urology, University of Michigan, Ann Arbor, MI
3Division
of General Medicine, Department of Internal Medicine, University of Michigan, Ann
Arbor, MI
Introduction
Author Manuscript
The Centers for Medicare & Medicaid Services (CMS) is incentivizing hospitals to provide high-quality, low-cost care.1 As part of these efforts, CMS recently added the MedicareSpending-per-Beneficiary (MSPB) metric to its Hospital Value-Based Purchasing (HVBP) program, marking the first time that most US hospitals have received financial penalties or rewards based on their performance on a risk-adjusted, price-standardized 30-day episodebased measure of Medicare spending along with quality measures. It is not yet known how hospitals can do well on this new spending measure. We examined whether hospitals that performed poorly (or well) did so because of spending before, during, or after hospitalization.
Methods
Author Manuscript
We determined hospital performance on the MSPB measure in FY 2014 and 2015, using publicly available data on CMS’s Hospital Compare. The MSPB metric is based on all price-standardized, risk-adjusted Medicare Part A and Part B payments for episodes of care from three days prior to admission through 30 days after discharge.2 The metric is not condition-specific, as admissions for all fee-for-service Medicare beneficiaries are included. In 2015, hospital performance on the MSPB, which accounts for 20% of the overall HVBP score, along with performance in three quality domains (the remaining 80%), determine
Corresponding Author: Anup Das, BA, School of Public Health, University of Michigan, 1415 Washington Heights, Room M2001 – Building II, Ann Arbor, MI 48109, Phone: (814) 883-2441, [email protected]. Author Contributions: Mr. Das had full access to all of the data in the study and takes responsibility for the integrity of the data and accuracy of the data analysis. Drs. Chen, Norton, and Miller contributed equally to this work. Study concept and design: Das, Chen, Norton, Miller Acquisition, analysis, or interpretation of data: Das, Chen, Norton, Miller Drafting of the manuscript: Das Critical revision of the manuscript for important intellectual content: Das, Chen, Norton, Miller Statistical analysis: Das, Chen, Norton Obtained funding: Chen, Miller Study supervision: Chen, Norton, Miller
Das et al.
Page 2
Author Manuscript
whether a hospital will receive a penalty or bonus totaling up to 1.5% of all Medicare payments.3
Author Manuscript
We classified hospitals by their MSPB performance, using CMS’s method for assigning domain scores. Low-cost hospitals are those with MSPB scores that are equal to or lower than the benchmark, defined as the mean of hospital scores in the first decile. Medium-cost hospitals have MSPB scores greater than the benchmark and less than or equal to the 50th percentile. High-cost hospitals have MSPB scores that are greater than the 50th percentile.2 Across these spending categories, we compare MSPB scores and price-standardized payments for three components of an episode (pre-admission, index admission, and postdischarge care) by seven sources of spending (inpatient, outpatient, skilled nursing facility (SNF), durable medical equipment, carrier, home health agency, and hospice). We also describe changes in hospital performance across the two years. We performed two-sample ttests to evaluate the differences between high- and low-cost hospitals as well as hospitals that got better or worse. This study was declared exempt by the University of Michigan Institutional Review Board.
Results Among 3,194 hospitals in HVBP in 2015, pre-admission, index admission, and postdischarge spending made up 3%, 53% and 44% of average total episode spending of $18,247. SNF and readmission payments accounted for 38% and 30% of post-discharge payments, respectively.
Author Manuscript
A total of 135 hospitals (4%) were low-cost hospitals in 2015, 1,630 (51%) were medium cost, and 1,429 (45%) were high cost (Table). Patients admitted to high-cost hospitals spent an average of $7,385 more than patients in low-cost hospitals ($19,908 vs. $12,523, p
JAMA Intern Med. Author manuscript; available in PMC 2016 January 05. Published in final edited form as: JAMA Intern Med. 2016 January 1; 176(1): 117–119. doi:10.1001/jamainternmed.2015.6261.
Spending in the Post-Acute Care Setting Accounts for a Sizeable Portion of Spending Associated with a Hospitalization Episode Anup Das, BA1, Edward C. Norton, PhD1, David C. Miller, MD, MPH2, and Lena M. Chen, MD, MS3
Author Manuscript
1Department
of Health Management and Policy, University of Michigan, Ann Arbor, MI
2Department
of Urology, University of Michigan, Ann Arbor, MI
3Division
of General Medicine, Department of Internal Medicine, University of Michigan, Ann
Arbor, MI
Introduction
Author Manuscript
The Centers for Medicare & Medicaid Services (CMS) is incentivizing hospitals to provide high-quality, low-cost care.1 As part of these efforts, CMS recently added the MedicareSpending-per-Beneficiary (MSPB) metric to its Hospital Value-Based Purchasing (HVBP) program, marking the first time that most US hospitals have received financial penalties or rewards based on their performance on a risk-adjusted, price-standardized 30-day episodebased measure of Medicare spending along with quality measures. It is not yet known how hospitals can do well on this new spending measure. We examined whether hospitals that performed poorly (or well) did so because of spending before, during, or after hospitalization.
Methods
Author Manuscript
We determined hospital performance on the MSPB measure in FY 2014 and 2015, using publicly available data on CMS’s Hospital Compare. The MSPB metric is based on all price-standardized, risk-adjusted Medicare Part A and Part B payments for episodes of care from three days prior to admission through 30 days after discharge.2 The metric is not condition-specific, as admissions for all fee-for-service Medicare beneficiaries are included. In 2015, hospital performance on the MSPB, which accounts for 20% of the overall HVBP score, along with performance in three quality domains (the remaining 80%), determine
Corresponding Author: Anup Das, BA, School of Public Health, University of Michigan, 1415 Washington Heights, Room M2001 – Building II, Ann Arbor, MI 48109, Phone: (814) 883-2441, [email protected]. Author Contributions: Mr. Das had full access to all of the data in the study and takes responsibility for the integrity of the data and accuracy of the data analysis. Drs. Chen, Norton, and Miller contributed equally to this work. Study concept and design: Das, Chen, Norton, Miller Acquisition, analysis, or interpretation of data: Das, Chen, Norton, Miller Drafting of the manuscript: Das Critical revision of the manuscript for important intellectual content: Das, Chen, Norton, Miller Statistical analysis: Das, Chen, Norton Obtained funding: Chen, Miller Study supervision: Chen, Norton, Miller
Das et al.
Page 2
Author Manuscript
whether a hospital will receive a penalty or bonus totaling up to 1.5% of all Medicare payments.3
Author Manuscript
We classified hospitals by their MSPB performance, using CMS’s method for assigning domain scores. Low-cost hospitals are those with MSPB scores that are equal to or lower than the benchmark, defined as the mean of hospital scores in the first decile. Medium-cost hospitals have MSPB scores greater than the benchmark and less than or equal to the 50th percentile. High-cost hospitals have MSPB scores that are greater than the 50th percentile.2 Across these spending categories, we compare MSPB scores and price-standardized payments for three components of an episode (pre-admission, index admission, and postdischarge care) by seven sources of spending (inpatient, outpatient, skilled nursing facility (SNF), durable medical equipment, carrier, home health agency, and hospice). We also describe changes in hospital performance across the two years. We performed two-sample ttests to evaluate the differences between high- and low-cost hospitals as well as hospitals that got better or worse. This study was declared exempt by the University of Michigan Institutional Review Board.
Results Among 3,194 hospitals in HVBP in 2015, pre-admission, index admission, and postdischarge spending made up 3%, 53% and 44% of average total episode spending of $18,247. SNF and readmission payments accounted for 38% and 30% of post-discharge payments, respectively.
Author Manuscript
A total of 135 hospitals (4%) were low-cost hospitals in 2015, 1,630 (51%) were medium cost, and 1,429 (45%) were high cost (Table). Patients admitted to high-cost hospitals spent an average of $7,385 more than patients in low-cost hospitals ($19,908 vs. $12,523, p
