Cost inefficiency and hospital health outcomes.

This study explores the association between cost inefficiency and health outcomes in a national sample of acute-care hospitals in the US over the period 1999-2001, with health outcomes being measured by both mortality and complications rates. The empirical analysis examines health outcomes as a function of cost inefficiency and other determinants of outcomes, using stochastic frontier analysis to obtain hospital cost inefficiency scores. The results showed no systematic pattern of association between cost inefficiency and hospital health outcomes; the basic results were unchanged regardless of whether cost inefficiency was measured with or without using instrumental variables. The analysis also indicated, however, that the association between cost inefficiency and health outcomes may vary substantially across geographical regions. The study highlights the importance of distinguishing between 'good' costs that reflect the efficient use of resources and 'bad' costs that stem from waste and other forms of inefficiency. In particular, the study's results suggest that hospital programs focused on reducing cost inefficiency are unlikely to be associated with worsened hospital-level mortality or complications rates, while, on the other hand, across-the-board reductions in cost could well have adverse consequences on health outcomes by reducing efficient as well as inefficient costs.

McKay NL ，Deily ME 《HEALTH ECONOMICS》

Cost inefficiency and mortality rates in Florida hospitals.

This study examines the relationship between health outcomes and cost inefficiency in Florida hospitals over the period 1999-2001, with health outcomes measured by risk-adjusted in-hospital mortality rates. Previous research has come to conflicting conclusions regarding the relationship between costs and health outcomes. We hypothesize that these seemingly conflicting findings are due to the fact that total cost has two components--cost that reflects the best use of resources under current circumstances and cost associated with waste or inefficiency. By isolating costs due to inefficiency, we can examine directly their relationship, if any, to hospital mortality rates, and begin to assess whether policies that create incentives for hospitals to increase efficiency have adverse effects on health outcomes. We regress an in-hospital mortality index for each hospital on a measure of the hospital's cost inefficiency, obtained from a stochastic cost frontier estimation, as well as on predicted mortality and a set of variables linked to mortality performance. Our results indicate a positive and significant relationship between a hospital's mortality performance and its inefficiency: on average, a one percentage point reduction in cost inefficiency would be associated with one fewer in-hospital death per 10,000 discharges, holding patient risk and other factors constant.

Deily ME ，McKay NL 《HEALTH ECONOMICS》

Further evidence that hospital production is inefficient.

Chirikos TN 《INQUIRY-THE JOURNAL OF HEALTH CARE ORGANIZATION PROVISION AND FINANCING》

Inefficiency as the major driver of excess costs in lung resection.

Risk-adjusted outcomes of surgical care are important for quality and cost assessments. Although cardiac surgery is commonly studied, risk-adjusted analysis of excess costs of lung resection has not been pursued. We used 2002 to 2005 National Inpatient Sample of the Healthcare Cost and Utilization Project data to evaluate adverse outcomes and costs in elective lung resections in hospitals with more than 20 cases during that period. Adverse outcomes were inpatient death or excessive risk-adjusted postoperative stay. Logistic models were defined to predict adverse outcomes. Linear models were designed to predict costs. Hospital-specific adverse outcome rates and costs were measured to define performance outliers. Cost-effective reference hospitals were used to define total excess costs. Among 12,182 patients at 215 hospitals undergoing lung resection, there were 336 inpatient deaths (2.8%) and 880 live discharges with prolonged risk-adjusted postoperative stay (7.2%). Predictive models for mortality and risk-adjusted postoperative stay had C statistics of 0.773 and 0.643, respectively. There were 11 ineffective hospitals (5.1%) with excessive adverse outcomes (P < .005) and 34 inefficient hospitals (15.8%) meeting quality measures but with higher than predicted costs (P < .0005). Ineffective hospitals had costs $1020 per case lower than predicted. Inefficient hospitals had costs $9978 higher than predicted. Inefficiency is the major factor in excess inpatient costs associated with lung resection in this model. Although refinements in databases, including total physician costs and postdischarge adverse event costs, will alter models, excess costs of lung resection appear to be driven by inefficiency, not adverse outcomes.

Fry DE ，Pine M ，Jones BL ，Meimban RJ ... -  《-》

Testing the hospital value proposition: an empirical analysis of efficiency and quality.

Huerta TR ，Ford EW ，Peterson LT ，Brigham KH ... -  《-》