The impact of market characteristics on Medicare expenditures for skilled nursing facility post-acute episodes of care: The experience of diabetics with end -stage renal disease.
Neuwald, Sharon Frances
2000
Abstract
A two stage analysis assessed (1) whether specific environmental factors were associated with the distribution of SNF post-acute providers in a market and (2) which market factors predicted variation in Medicare Part A patient expenditures for diabetic patients with End-Stage Renal Disease (ESRD) who use SNF post-acute services. Multivariate and hierarchical regression techniques were conducted to test resource dependency and contingency organizational theories that provider behavior at the market level affect Medicare Part A expenditures for this population within metropolitan statistical areas in the United States. The first-stage model tested a resource dependency framework, predicting that the distribution of hospital-based versus freestanding skilled nursing facility (SNF) post-acute providers was determined by environmental, and structural market characteristics of hospitals and nursing facilities, adjusting for production costs, market demand differences and geographic variation. Many findings in these models were consistent with the resource dependency hypotheses. Historical hospital bed supply, post-acute market concentration and markets with Medicaid nursing home case mix-adjusted reimbursement systems were positively associated, while historical nursing home bed supply and markets with hospital or nursing facility CON or moratoria were negatively associated with the prevalence of hospital-based post-acute providers in a market. The second stage model used contingency theory as its conceptual framework to predict the effect of market variables on Medicare Part A patient expenditures. Adjusting for structural market characteristics of hospitals and nursing homes, price differences, and patient and market demand, the study analyzed the effects of post-acute provider distribution and competition on Medicare Part A patient expenditures for diabetics with ESRD. In general, most market characteristics were not significant predictors of Medicare Part A expenditures for this population group, and the percentage of hospital-based post-acute providers in a market did not affect patient expenditures. The effect of post-acute market concentration was contrary to expectations with increased concentration reducing patient expenditures. Managed care results also were surprising with greater HMO penetration predicting increased patient expenditures. Patient characteristics and socioeconomic factors in the market were more significant predictors of Medicare Part A expenditures. In addition, these results suggested that ESRD patients may be questionable candidates for post-acute care, given the high mortality rate of diabetic patients during post-acute episodes. The lack of influence of post-acute provider distribution on patient expenditures indicated diabetic ESRD patients may not be representative of the Medicare population which use post-acute services. Additional research should analyze the impact that the prevalence of post-acute providers in a market has on Medicare expenditures for patient populations who are more frequent users of post-acute care. This would determine whether the distribution of post-acute providers shapes market patterns of care and influences outcomes over an episode of service. Additional analysis should be conducted about the role of post-acute market concentration on provider distribution and patient expenditures to assess how post-acute markets should be structured to most favorably respond to Medicare reimbursement and other payors in the market. Finally, given the consistent strong findings of patient characteristics, additional examination should assess whether specific case mix adjusters, which incorporate co-morbid conditions and hospitalization factors, influence expenditure patterns over an episode of care.Subjects
Acute Care Characteristics Diabetics End-stage Renal Disease Episodes Expenditures Experience Impact Market Medicare Nursing Home Post Postacute Skilled Nursing Facility
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