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Post-acute SNF Care a Source of Wasteful Healthcare Spending, Research Suggests

Analysis  |  By Christopher Cheney  
   July 24, 2017

Research using claims data from Medicare raises questions about the relative cost-effectiveness of inpatient care and post-acute-care in a skilled nursing facility.

New research on the cost-effectiveness of inpatient care at hospitals compared to skilled nursing facility (SNF) care is based on a technique used to compare hospital performance, the study's lead author says.

"When you compare hospitals, the big concern is [that] they treat different patients, which makes it very difficult to compare outcomes or how hospitals treat people. But now, we have a new way of comparing very similar patients who go to different hospitals," Joseph J. Doyle, Jr.

Doyle is a professor of applied economics at the Massachusetts Institute of Technology. He and colleagues at MIT and Vanderbilt University are using Medicare ambulance-service claims data to compare spending and other performance measures at hospitals.

Related: Inpatient Setting More Cost-Effective than SNFs

The study Doyle published this month in the Journal of Health Economics, "Uncovering Waste in U.S. Healthcare: Evidence from Ambulance Referral Patterns," examined average 90-day spending on more than 1.5 million Medicare patients.

The research shows that hospitals that spend intensively on inpatient care and send patients home rather than to a SNF generate lower one-year mortality rates than hospitals that spend more intensively on post-acute-care at SNFs.

"We characterized the types of hospitals that get better outcomes. [They] tend to be more intense on the inpatient side. It doesn't necessarily have to be length of stay. Hospitals with better outcomes could be doing more inpatient procedures, for example," Doyle says.

"These hospitals treat patients more intensively during their inpatient stay, then they send people home instead of sending them to SNFs."

More Research Needed

While this finding is provocative, more research is required to draw conclusions on the relative cost-effectiveness of inpatient care vs. SNF care, he says. "We are able to characterize the hospitals that get good outcomes, but it's a leap to say we should all mimic the type of care that is given in those hospitals."

"Maybe the hospitals that spend more intensively on inpatient care and send patients home have better doctors and better nurses; it's possible that there are many characteristics of hospitals that result in that type of treatment profile."

In addition to further research to determine whether other hospitals can replicate the mortality outcomes of hospitals with an inpatient-care-intense treatment profile, more research is necessary to examine the cost-effectiveness of SNF care, Doyle says. "This spotlight is suggesting that we should take a close look at post-acute-care."

Related: Getting the Value Out of Postacute Care

Comparing the treatment outcomes of patients who are sent home rather than to a SNF after inpatient care is prime area for future research.

"For patients where it is not obvious whether they should go home or go to a SNF, we should have studies that either historically or, even better, prospectively, randomize those patients to either go with home-health care or go to a SNF… If we send more people home, do we achieve better outcomes or not?"

In addition to the tantalizing findings about inpatient care and SNF care, Doyle's latest research casts doubt about earlier comparative research conducted on hospital performance.

"There is a large literature that suggests it really does not matter what hospital a patient goes to for care, in terms such as survival rates from a heart attack. We are concerned that earlier hospital comparisons did not take into account that the patients were different. We say it does matter where you go," Doyle says.

"If it doesn't matter where you go, then people could say high-intensity hospitals are wasteful."

Christopher Cheney is the CMO editor at HealthLeaders.

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