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Does Public Reporting Affect Patient Behavior?

May 7, 2012 in Nursing Home, Nursing Homes, Quality | No comments

A number of studies have already examined this question.

  • Baker et al. (2003) examined the effectiveness of a public reporting effort in hospitals in Ohio, finding little relationship between a hospital’s report card ranking and changes in its market share.
  • Cutler et al. (2004) examined the effects of reporting quality information about cardiac surgery on hospital volume, finding that being identified as a high-mortality hospital was associated with a decline in the number of cardiac surgery patients at that hospital in the period following the designation.
  • Dafny and Dranove (2008) examine the influence of Medicare HMO report cards…showing that highly ranked plans were gaining market share prior to the report cards’ release but that the report cards led to further gains in market share for high-scoring plans.
  • Chernew et al. (2008) use a Bayesian learning model to estimate enrollees’ general assessment of plan quality prior to the release of report cards and the changes in these assessments over time. They find that the addition of publicly reported plan information has a small incremental effect.

A more recent study by Werner et al. (2012) examines whether Medicare’s Nursing Home Compare website affects consumer decisions. Nursing Home Compare evaluates nursing homes using a variety of factors including: 1) whether they passed inspections, 2) structural measures such as staffing ratios, 3) quality measures reported on MDS assessments.

The authors find “a very small (though statistically significant) demand response to public reporting.”  Skilled nursing facility (SNF) market share experienced a 0.1% increase in market share in cases where the facility increased its reported quality of treating patient pain from the 25th percentile SNF to the 75th percentile SNF.

Werner et al. note that this small economic response implies that SNFs are unlikely to invest in quality improvement since improving quality will not increase market share and improve profits.

One shortcoming of the study is that it only focuses on SNFs.  Since Medicare uses SNFs for shorter term post-acute care, the study cannot identify changing consumer responses for long-term nursing stays.  Because the time the patient spends in long-term nursing homes is typically much longer than SNFs and because patients typically have more time to review their long-term nursing home options than would be the case when they enter SNFs, it is more likely that a consumer response would be observed in the long-term nursing home setting.

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The Decline of Mental Hospitals, 1950s

April 27, 2012 in Mental Health, Mental Illness, Nursing Home, Nursing Homes | No comments

The movement of mental health care from mental hospitals to treatment in outpatient settings and nursing homes  began in the 1950s.  Here is how it happened.

“The field of medicine where the ‘rediscovery of community’ found an immediately welcome reception was mental health services.  A movement away from mental hospitals had already begun in the mid-1950s.  The national census of mental hospitals declined from a peak of 634,000 in 1954 to 579,000 by 1963.  The predominant, though contested, explanation for the drop is that the discover and introduction of major tranquilizers (e.g., Thorazine) was the decisive event.  Patients who were previously hospitalized could now be safely treated, or at least more safely ignored, on an outpatient basis.  Another interpretation points to the adoption by Congress in 1956 of amendments to Social Security that provided greater aid to states to support the aged in nursing homes. Mental hospitals had been filled with unwanted older people suffering only from a harmless senility.  By transferring such patients from mental hospitals to nursing homes, the states could transfer part of the cost of upkeep to the federal government.  Probably both drugs and nursing homes had some effect on the decline of mental hospitalization.”

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CLASS Act Repealed

February 14, 2012 in Nursing Home | 1 comment

In 2011, 13 percent of Americans were over 65 years old.  In the coming years, this number will only increase.  Unsurprisingly, the demand for long-term care will also increase. Currently, spending on long-term care in Medicaid only was over $50 billion in 2009.

One option for increasing the affordability of the long-term care market is to have the government and stabalize the long-term care insurance market.  Currently, the market for long-term care insurance is small because of a signficant amount of adverse selection; individuals unlikely to need LTC don’t buy LTC insurance.

Ted Kennedy’s CLASS Act would have created a voluntary and public long-term care insurance option.  Under the CLASS Act:

  • Enrollees would have paid a monthly premium, through payroll deduction
  • Enrollees would have been covered on a guaranteed-issue basis
  • Enrollees would have been eligible for benefits after paying premiums for five years and having worked at least three of those years
  • Enrollees would have received a lifetime cash benefit after meeting benefit eligibility criteria, based on the degree of impairment [5]

The CLASS Act, however, was not to be.  By a vote of 267-159, lawmakers passed H.R. 1173, Fiscal Responsibility and Retirement Security Act of 2011, which repealed the CLASS Act.

“The CLASS Act, a pet project of the late Sen. Ted Kennedy, is a voluntary program where taxpayers could volunteer to pay premiums for long-term care that would allow the taxpayer to get that cash later in life.

Health and Human Services Secretary Kathleen Sebelius wrote a letter to Congress Oct. 14 explaining that a 19-month ‘comprehensive analysis’ of the CLASS program indicated that it was not viable.

The measure, formally known as the Community Living Assistance Services and Supports Act, came with a five-year waiting period before it started to pay out benefits, but it started collecting revenues immediately. Republicans argued that the act was just another example of how the administration hid the cost of the Affordable Care Act.“

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