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Study Identifies 10 Most Cost-Efficient U.S. Hospitals

Analysis  |  By Christopher Cheney  
   November 09, 2021

The study found that if all hospitals operated as efficiently as the most cost-efficient hospitals, the Medicare program would save $8 billion annually.

A new analysis by the Lown Institute lists the 10 most cost-efficient hospitals in the country.

Healthcare accounts for a significant share of the U.S. economy, according to statistics published by the Centers for Medicare & Medicaid Services. In 2019, national health expenditure grew 4.6% to $3.8 trillion, or $11,582 per American. In 2019, national health expenditure accounted for 17.7% of the country's gross domestic product.

The Lown Institute analyzed data from more than 3,000 hospitals. The study examined how much Medicare was billed and compared that figure to 30- and 90-day mortality rates.

For hospitals with average 30-day mortality rates, per-patient Medicare costs ranged from $9,000 to $27,000. The study found that if all hospitals operated as efficiently as the most cost-efficient hospitals, the Medicare program would save $8 billion annually.

The 10 most cost-efficient health systems and hospitals were as follows:

1. Pinnacle Hospital, Crown Point, Indiana

2. Saint Mary’s Regional Medical Center, Reno, Nevada

3. Mercy Medical Center Dubuque, Dubuque, Iowa

4. Encino Hospital Medical Center, Encino, California

5. Park Ridge Health, Hendersonville, North Carolina

6. Oroville Hospital, Oroville, California

7. Saint Michael’s Medical Center, Newark, New Jersey

8. UnityPoint Health-Meriter, Madison, Wisconsin

9. East Liverpool City Hospital, East Liverpool, Ohio

10. Maple Grove Hospital, Maple Grove, Minnesota

The study proves that hospitals can provide cost-efficient care with good outcomes, Vikas Saini, MD, president of the Lown Institute, said in a prepared statement. "If we want to keep costs low for the Medicare program and provide quality care for the 60 million Americans who depend on it, hospitals must be as efficient as possible. The best hospitals prove that you can save Medicare dollars and deliver great patient outcomes at the same time."

The study analyzed Medicare claims data for patients hospitalized from 2016 to 2018. Mortality rate and cost data was adjusted based on patient risk. Hospitals with the lowest mortality rates and lowest costs generated the best cost-efficiency scores.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


KEY TAKEAWAYS

For hospitals with average 30-day mortality rates, per-patient Medicare costs ranged from $9,000 to $27,000.

Hospitals with the lowest mortality rates and lowest costs generated the best cost-efficiency scores.

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