Prospective payment for Medicare home health : a promising system to save resources

141 Pages·2002·4.8 MB·English

by  Cheh, Valerie

2
ContractNo.: 500-94-0062 MATHEMATICA
MPRReferenceNo.: 8246-11
PolicyResearch,Inc,
ProspectivePayment
forMedicareHome
Health: APromising
SystemtoSaveResources
April2001
ValerieCheh
WilliamBlack
Submittedto: Submittedby:
HealthCareFinancingAdministration MathematicaPolicyResearch,Inc.
7500SecurityBlvd. P.O.Box2393
(C3-21-26) Princeton,NJ 08543-2393
Baltimore,MD21244-1850 [phone]
ProjectOfficer: ProjectDirector:
AnnMeadow ValerieCheh
PrincipalInvestigators:
RandallBrown
BarbaraPhillips

CONTENTS
Chapter Page
EXECUTIVESUMMARY xi
I THEPER-EPISODEHOMEHEALTHDEMONSTRATIONAND
EVALUATION
I
A. THEMEDICAREHOMEHEALTHBENEFIT 2
B. THEPER-EPISODEDEMONSTRATION 4
1. DemonstrationPaymentandIncentives 7
2. OtherDemonstrationProcedures 10
C. GUIDETOTHERESTOFTHISREPORT 12
II DATA,SAMPLES,ANDMETHODS 15
A. DATAANDSAMPLES .: 15
1. CostReportData 15
2. ExclusionofAgencies 16
3. EpisodeConstruction 18
4. TimeSheetSurvey 23
5. AgencyAnalysisSample 23
B. OUTCOMEANDCONTROLVARIABLES 24
1. OutcomeVariables 24
2. ControlVariablesfortheAnalysisoftheLengthofVisit 26
C. ANALYTICMETHODS 28
1. Fixed-EffectsModels 28
2. SubgroupAnalysis 32
3. HypothesisTestsfortheImpactEstimates 34
4. Robustness 35
iii
CONTENTS(continued)
Chapter Page
in HOWDIDPROSPECTIVEPAYMENTAFFECTAGENCYFINANCES? ..39
A. IMPACTONCOSTPEREPISODE 39
B. DEMONSTRATIONIMPACTSONCOSTPERVISIT 44
1. WhatCausedtheIncreaseinPer-VisitCosts? 47 ^
2. ImpactonLengthofVisit 51
C. DIDTHEDEMONSTRATIONAGENCIESEARNAPROFIT? 54
^
1. DidAgenciesEarnaProfitonTheirMedicareBusiness? 55
2. DidAgenciesEarnaProfitOverall? 63
D. IMPACTONMEDICAREVISITREVENUESANDTOTAL
REVENUES 65
E. ROBUSTNESSTESTS 69
1. Outliers 69
2. ExclusionofAgenciesthatWereAbouttoCloseorMerge 70 ^
3. InclusionofAgencieswithDifficultySubmittingBills 72
F. SUMMARY 73
IV SUBGROUPIMPACTS 75
A. EXPECTEDIMPACTSAMONGSUBGROUPS 76
.•VI
B. IMPACTSFORAGENCYSUBGROUPS 78
C. SUMMARY 89 it
iv
CONTENTS(continued)
Chapter Page
V CONCLUSIONS 91
A. KEYFINDINGS 91
B. LIMITATIONSOFTHEANALYSIS 92
C. LESSONSLEARNED 94
REFERENCES 96
APPENDIXA: SUMMARYOFCASE-MIXADJUSTMENTFOR
PAYMENTSDURINGTHEDEMONSTRATION
APPENDIXB: SUPPLEMENTALTABLES
APPENDIXC: SUBGROUPESTIMATESUSINGTWOYEARS
OFDEMONSTRATIONDATA
V

TABLES
Table Page
n.l NUMBEROFAGENCIESPROVIDINGDATA,BY
F DEMONSTRATIONYEAR
17
II.2 PATIENTADMISSIONSRECORDSEXCLUDEDFROMTHE
ANALYSISSAMPLE,BYTREATMENTSTATUS 21
n.3 SOURCESOFDATAFOROUTCOMEVARIABLES 25
n.4 LISTOFCONTROLVARIABLESINREGRESSIONSONLENGTH
OFVISIT 27
n.5 MINIMALDETECTABLEEFFECTSFORAGENCY-LEVELANALYSIS....36
111.1 IMPACTSOFPROSPECTIVEPAYMENTONCOSTPEREPISODE 41
111.2 IMPACTSOFPROSPECTIVEPAYMENTONCOSTPERVISIT 45
111.3 IMPACTSOFPROSPECTIVEPAYMENTONCOSTPERVISIT,
CONTROLLINGFORAGENCYVOLUME 48
111.4 THEEFFECTSOFVISITSPEREPISODEONCOSTPERVISIT 50
- III.5 IMPACTSONLENGTHOFVISIT 52
111.6 CUMULATIVEMEDICAREPROFITSFORPROSPECTIVELYPAID
. AGENCIESDURINGTHEFIRSTTWOYEARSOFTHE
DEMONSTRATION 60
111.7 DISTRIBUTIONOFPROFITABLEANDNONPROFITABLE
AGENCIESBASEDONTWO-YEARCUMULATIONS 61
111.8 MEDIANNETREVENUES(TOTALPROFITS)FORFREESTANDING
7 AGENCIES,BYTREATMENTSTATUS 64
111.9 IMPACTSOFPROSPECTIVEPAYMENTONNETREVENUES
(TOTALPROFITS) 66
—
•>
vii
TABLES(continued)
Table Page
III.1 IMPACTSOFPROSPECTIVEPAYMENTONAGENCYREVENUES 67
III.11 PSEANYSMIETINVTITOYNAANGAELYNSCIYSOFUOTRCTOHMEESIMPACTOFPROSPECTIVE 71 ^,
IV.1 AVERAGEANNUALOFPER-EPISODEPAYMENTONAGENCY
FINANCES: NONPROFITANDFOR-PROFITAGENCIES 79
IV.2 AVERAGEANNUALIMPACTOFPER-EPISODEPAYMENTON
AGENCYFINANCES: LOW-PRIOR-USEANDHIGH-PRIOR-USE
AGENCIES 81
IV.3 AVERAGEANNUALIMPACTOFPER-EPISODEPAYMENTON
AGENCYFINANCES: SMALLANDLARGEAGENCIES 83
IV.4 AVERAGEANNUALIMPACTOFPER-EPISODEPAYMENTON
AGENCYFINANCES: HOSPITAL-BASEDANDFREESTANDING
AGENCIES 86
IV.5 AAVGEERNACGYEFIANNANNUCEASL:IAMBPOAVCET-OCFOSPTE-RL-IEMPIITSSODAENPDABYEMLEONWT-COONST-LIMITS .^-.n
AGENCIES 88
viii
FIGURES
Figure Page
1.1 POLICYCONTEXT 5
111.1 AVERAGECOSTPEREPISODE 42
111.2 PROSPECTIVELYPAIDAGENCYMEDICAREPROFITRATES
ASAPERCENTAGEOFTOTALMEDICAREVISITREVENUE 56
111.3 ITISUNCLEARWHETHERMOREPROSPECTIVELY-PAIDAGENCIES
EARNEDPROFITSOVERTIME 58
IV.1 AVERAGECOSTPERSKILLEDNURSINGVISIT,BYDEMONSTRATION
YEARANDAGENCYSIZE 85
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