Financial Performance of Hospitals in the Appalachian Region Under the Hospital Readmissions Reduction Program and Hospital Value‐Based Purchasing Program

Purpose The Hospital Readmission and Reduction Program (HRRP) and Hospital Value‐Based Purchasing Program (HVBP) propose to improve quality of patient care by either rewarding or penalizing hospitals through inpatient reimbursement. This study analyzes the effect of both programs on profitability of...

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Vydáno v:The Journal of rural health Ročník 37; číslo 2; s. 296 - 307
Hlavní autoři: Karim, Saleema A., Nevola, Adrienne, Morris, Michael E., Tilford, J. Mick, Chen, Hsueh‐Fen
Médium: Journal Article
Jazyk:angličtina
Vydáno: England Wiley Subscription Services, Inc 01.03.2021
Témata:
Appalachian Region
data collection
Economics
finance
Financial performance
Fines and penalties
geographical variation
hospital readmission reduction program
hospital value‐based purchasing
Hospitalization
Hospitals
income
Inpatient care
markets
Panel data
patient care
Patients
Penalties
Profitability
Profits
Purchasing
Quality of care
Readmission
Reduction
Regions
Research design
Revenue
rural health
Rural health care
Value
United States > US
Appalachia
Appalachian region
hospital value-based purchasing
hospital readmission reduction program
financial performance
Appalachian Region
geographical variation
ISSN:0890-765X, 1748-0361, 1748-0361
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Shrnutí:Purpose The Hospital Readmission and Reduction Program (HRRP) and Hospital Value‐Based Purchasing Program (HVBP) propose to improve quality of patient care by either rewarding or penalizing hospitals through inpatient reimbursement. This study analyzes the effect of both programs on profitability of hospitals located in the Appalachian Region (AR) compared to hospitals in Appalachian states and the rest of the United States. Methods This study used a retrospective research design with a longitudinal unbalanced panel dataset from 2008 to 2015. Hospitals participating in both HRRP and HVBP during this time frame were included in the study. A difference‐in‐difference model with hospital‐level fixed effects, controlling for hospital and market characteristics, was used to determine effects of both programs on profitability of hospitals serving the AR, Appalachian states, and the rest of the United States. Findings After implementation of HRRP and HVBP, only hospitals located in Appalachian states experienced a significant decrease in operating margin (−1.14 percentage points). Unexpectedly, during the same time period, total margin increased significantly for hospitals located in the AR (1.05 percentage points), Appalachian states (1.71 percentage points), and the rest of the United States (2.38 percentage points). Conclusions HRRP and HVBP financially incentivize hospitals to focus efforts on improving patient care. The programs may not have the anticipated results. Increases in total margin for all hospitals during the study period indicate access to nonpatient revenues, offsetting the financial penalties from both programs. This revenue source may undermine the program's objectives of delivering value and achieving quality outcomes.
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ISSN:0890-765X
1748-0361
1748-0361
DOI:10.1111/jrh.12475