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Impact of Profitability on Hospital Responses to Financial Stress
The researchers will examine the impact of financial pressure on hospitals on the quality of care provided. They will test whether hospitals' responses to a change in the level of reimbursement is likely to vary by DRG-specific incentives, using the Medicare BBA as an example. They would: 1) calculate the generosity of Medicare payment by diagnoses and service lines for 1995, 2000, and 2005; 2) compare the quality of care received by patients hospitalized with conditions from more vs. less profitable service lines in 1995, 2000, and 2006; 3) test the effects of changes in reimbursement on mortality for more vs. less generously reimbursed diagnoses and service lines; and 4) test the effects of changes in reimbursement on Patient Safety Indicators (PSIs) for more vs. less generously reimbursed diagnoses and service lines. The researchers note that existing studies on the effects of financial stress on hospitals have examined acute myocardial infarctions, one profitable condition that may provide a misleading sense of the overall impacts on quality and cost/quality tradeoffs. The objective of this study is to provide policymakers with better ability to measure profitability and quality for hospital service lines (e.g., neurosurgery, cardiology, etc.), the level at which many important decisions about resource allocation are made.
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