Effect of Site-Neutral Payment Policy on Long-Term Acute Care Hospital Use

Anil N. Makam, Oanh Kieu Nguyen, Benjamin Kirby, Michael E. Miller, Lei Xuan, Ethan A. Halm

Research output: Contribution to journalArticle

1 Citation (Scopus)

Abstract

Objective: To assess the projected effect of the Centers for Medicare and Medicaid Services new site-neutral payment policy, which aims to decrease unnecessary long-term acute care hospital (LTACH) admissions by reducing reimbursements for less-ill individuals by 2020. Design: Observational. Setting: National 5% Medicare data (2011–12). Measurements: We examined the proportion of site-neutral LTACH admissions. Regional LTACH market supply was defined as LTACH beds per 100,000 residents, categorized according to tertile. We conducted a hospital-level analysis to compare the projected effect of site-neutral payment on “propensity score” matched high- and low-LTACH-use hospitals. Results: Forty-one percent of LTACH admissions would be subjected to site-neutral payment. The proportion of site-neutral admissions was large, varied considerably according to LTACH (median 40%, interquartile range 22–60%), and was only modestly greater with greater market supply (Pearson correlation coefficient=0.23, p<.001; coefficient of determination=0.10). The site-neutral payment policy would affect 47% of admissions from the highest-supply regions, versus 30% from the lowest-supply regions (p<.001); and 43% from high-use hospitals versus 36% from propensity score-matched low-use hospitals (p<.001). Conclusion: A considerable proportion of LTACH admissions will be subjected to lower site-neutral payments. Although the policy will disproportionately affect high-use regions and hospitals, it will also affect nearly one-third of the current LTACH population from low-use hospitals and regions. As such, the site-neutral payment policy may limit LTACH access in existing LTAC-scarce markets, with potential adverse implications for recovery of hospitalized older adults.

Original languageEnglish (US)
JournalJournal of the American Geriatrics Society
DOIs
StateAccepted/In press - Jan 1 2018

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Long-Term Care
Propensity Score
Hospital Equipment and Supplies
Centers for Medicare and Medicaid Services (U.S.)
Medicare

Keywords

  • health policy
  • long-term acute care hospital
  • Medicare
  • older adults
  • postacute care

ASJC Scopus subject areas

  • Geriatrics and Gerontology

Cite this

Effect of Site-Neutral Payment Policy on Long-Term Acute Care Hospital Use. / Makam, Anil N.; Nguyen, Oanh Kieu; Kirby, Benjamin; Miller, Michael E.; Xuan, Lei; Halm, Ethan A.

In: Journal of the American Geriatrics Society, 01.01.2018.

Research output: Contribution to journalArticle

Makam, Anil N. ; Nguyen, Oanh Kieu ; Kirby, Benjamin ; Miller, Michael E. ; Xuan, Lei ; Halm, Ethan A. / Effect of Site-Neutral Payment Policy on Long-Term Acute Care Hospital Use. In: Journal of the American Geriatrics Society. 2018.
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abstract = "Objective: To assess the projected effect of the Centers for Medicare and Medicaid Services new site-neutral payment policy, which aims to decrease unnecessary long-term acute care hospital (LTACH) admissions by reducing reimbursements for less-ill individuals by 2020. Design: Observational. Setting: National 5{\%} Medicare data (2011–12). Measurements: We examined the proportion of site-neutral LTACH admissions. Regional LTACH market supply was defined as LTACH beds per 100,000 residents, categorized according to tertile. We conducted a hospital-level analysis to compare the projected effect of site-neutral payment on “propensity score” matched high- and low-LTACH-use hospitals. Results: Forty-one percent of LTACH admissions would be subjected to site-neutral payment. The proportion of site-neutral admissions was large, varied considerably according to LTACH (median 40{\%}, interquartile range 22–60{\%}), and was only modestly greater with greater market supply (Pearson correlation coefficient=0.23, p<.001; coefficient of determination=0.10). The site-neutral payment policy would affect 47{\%} of admissions from the highest-supply regions, versus 30{\%} from the lowest-supply regions (p<.001); and 43{\%} from high-use hospitals versus 36{\%} from propensity score-matched low-use hospitals (p<.001). Conclusion: A considerable proportion of LTACH admissions will be subjected to lower site-neutral payments. Although the policy will disproportionately affect high-use regions and hospitals, it will also affect nearly one-third of the current LTACH population from low-use hospitals and regions. As such, the site-neutral payment policy may limit LTACH access in existing LTAC-scarce markets, with potential adverse implications for recovery of hospitalized older adults.",
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AB - Objective: To assess the projected effect of the Centers for Medicare and Medicaid Services new site-neutral payment policy, which aims to decrease unnecessary long-term acute care hospital (LTACH) admissions by reducing reimbursements for less-ill individuals by 2020. Design: Observational. Setting: National 5% Medicare data (2011–12). Measurements: We examined the proportion of site-neutral LTACH admissions. Regional LTACH market supply was defined as LTACH beds per 100,000 residents, categorized according to tertile. We conducted a hospital-level analysis to compare the projected effect of site-neutral payment on “propensity score” matched high- and low-LTACH-use hospitals. Results: Forty-one percent of LTACH admissions would be subjected to site-neutral payment. The proportion of site-neutral admissions was large, varied considerably according to LTACH (median 40%, interquartile range 22–60%), and was only modestly greater with greater market supply (Pearson correlation coefficient=0.23, p<.001; coefficient of determination=0.10). The site-neutral payment policy would affect 47% of admissions from the highest-supply regions, versus 30% from the lowest-supply regions (p<.001); and 43% from high-use hospitals versus 36% from propensity score-matched low-use hospitals (p<.001). Conclusion: A considerable proportion of LTACH admissions will be subjected to lower site-neutral payments. Although the policy will disproportionately affect high-use regions and hospitals, it will also affect nearly one-third of the current LTACH population from low-use hospitals and regions. As such, the site-neutral payment policy may limit LTACH access in existing LTAC-scarce markets, with potential adverse implications for recovery of hospitalized older adults.

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