Susan DesHarnais

The Risk-Adjusted Mortality Index. A new measure of hospital performance.

The Commission on Professional and Hospital Activities (CPHA) developed the Risk-Adjusted Mortality Index (RAMI), a method for comparing hospital death rates using existing abstract or billing data. The method is comprehensive insofar as it includes all payers and all types of cases except neonates. RAMI was designed to differentiate among admissions on the basis of the patient characteristics that increase or reduce the risk of dying in the hospital. Using a large national data base, risk factors were determined empirically within each of 310 clusters based on diagnosis-related groups (DRGs). The model was very effective at predicting risk-adjusted outcomes, with a correlation of 0.98 between actual and predicted deaths in a sample of 300 hospitals. RAMI appears to be a powerful tool for using existing data to monitor changes over time in hospital death rates.

Measuring hospital performance. The development and validation of risk-adjusted indexes of mortality, readmissions, and complications.

In this study we used information from discharge abstracts to develop three different risk-adjusted measures of hospital performance: a Risk-Adjusted Mortality Index, a Risk-Adjusted Readmissions Index, and a Risk-Adjusted Complications Index. The adjustments have face validity, and appear to account for much of the variation across hospitals in the rates of these adverse events. The indexes are stable over time, and are not biased with respect to hospital size, ownership, or teaching status. All three indexes appear to have construct validity when tested against the changes in hospital care that occurred when PPS was introduced.

The Effect of PPS on Hospital Product and Productivity

The results suggest that Prospective Payment System (PPS) prompted a reduction in the proportion of Medicare patients that were discharged, for whom the hospital considered the episode of care to be completed. The results also show a reduction in the proportion of patients discharged dead. When controlling for patient type, the results support the findings, but the magnitude of the change that might be attributed to PPS is somewhat smaller. Proportional changes in the input measures for all patients were next considered. The results indicate that fewer diagnostic tests, fewer laboratory tests, and fewer x-rays were used in 1984. Laboratory tests showed the most dramatic decrease. LOS decreased, but the drug input remained fairly constant. A productivity index that reflects the change in the input measure while controlling for patient type was developed. The results provide strong evidence of a productivity increase in all products for Medicare patients. The drug input did not contribute to the productivity increase. The 50 most frequent DRGs for Medicare patients were examined separately for productivity changes by product. The results further support the findings of an increase in productivity.

A Tale of Two Bounties: The Impact of Competing Fees on Physician Behavior

This study examines how the volume of privately insured services provided in hospital inpatient and outpatient departments changes in response to reductions in Medicare physician payments. We hypothesize that physicians consider relative payment rates when choosing which patients to treat in their practices. When Medicare reduces its payments for surgical procedures, as it did in the late 1980s, physicians are predicted to treat more privately insured patients because they become more lucrative. We use data from 182 hospitals for seventeen major procedures groups, covering a forty-five-month period between 1988 and 1991 that encom passes a twenty-four-month period before the reduction in Medicare fees and twenty-one months after the reduction. Our findings are consistent with the predictions for a number of procedure groups, but not for all of them. One implication of the findings is that societal savings from Medicare fee reductions are overstated if one does not also consider spillover effects in the private insurance market.

Changes in rates of unscheduled hospital readmissions and changes in efficiency following the introduction of the Medicare prospective payment system. An analysis using risk-adjusted data.

The purpose of this study was to analyze changes in rates of unscheduled readmissions and changes in technical efficiency following the introduction of the Medicare Prospective Payment System (PPS). We developed the RiskAdjusted Readmissions Index (RARI), which allowed us to make comparisons in rates of unanticipated readmissions across hospitals and over time. Data envelopment analysis (DEA), a linear programming technique, was used to measure changes in technical efficiency by comparing the inputs used and the outputs produced across a cohort of hospitals, while adjusting for changes over time in case mix and case complexity. Rates of unscheduled readmissions and efficiency scores were computed for a sample of 245 hospitals for each year. Although both readmission rates and efficiency scores increased for most hospitals, there was no evidence that those hospitals that experienced the greatest increases in efficiency had the largest increases in their rates of unscheduled readmissions.

Current uses of large data sets to assess the quality of providers. Construction of risk-adjusted indexes of hospital performance.

This article examines how large data sets can be used for evaluating the effects of health policy changes and for flagging providers with potential quality problems. An example is presented, illustrating how three risk-adjusted measures of hospital performance were developed using patient discharge abstracts. Advantages and disadvantage of this approach are discussed.

Indices for monitoring hospital outcomes in developed countries

We discuss some of the challenges facing hospitals in developed nations, with special attention to the need to monitor and evaluate hospital performance. In particular, there is a need for quality indicators that measure the effects of treatment, and are risk-adjusted, so that valid comparisons of outcomes can be made across hospitals that treat different types of patients. Until recently, only very crude quality indicators have been available for comparing the performance of different hospitals. We describe three risk-adjusted indices for comparing the outcomes of hospital care, focusing on the construction and validation of these measures. We discuss the uses of these tools for identifying problems and for monitoring outcomes of care within a hospital, including screening medical records for peer review, identifying variations in outcomes across various subgroups of physicians, and comparing changes in outcomes following various changes in the delivery system. Possible applications at the regional, national and international levels are then discussed, with special emphasis on the use of these tools for measuring the size of the gap between the efficacy of a technology, as determined through randomized controlled trials under stringent protocols, and the effectiveness of the same technology once it is exported, and then used under true practice conditions in another country.

The measurement of mortality: A risk-adjusted variable time window approach

This paper describes the development of risk-adjusted mortality indices (RAMI) using 1985 MEDPAR data from 657 hospitals. The RAMI methodology is adopted from the Commission on Professional and Hospital Activities, however both inhospital and post-discharge deaths are counted within time windows that vary by clinical condition. Five different RAMI measures (expected deaths/observed deaths) are developed, compared, and aggregated into various hospital characteristic strata. These measures vary by which discharge is held responsible for deaths within a time window, and whether or not inhospital deaths that occur beyond the time window are included. The RAMIs using varying time windows are compared with the RAMIs based upon inhospital deaths only. The inhospital RAMI was higher for the nonteaching hospitals (.95) as compared with the major and minor teaching institutions (.91 and .89). The RAMIs using the varying time windows, on the other hand, tend to be higher for the teaching institutions (e.g., 1.07 for major teaching hospitals; 0.99 for nonteaching hospitals).

Information management in the age of managed competition.

BACKGROUND Todays information requirements differ from those of the past, in terms of both the internal and external reporting needs of health care organizations. Demands for information are currently generated by physicians, quality managers, total quality management (TQM) teams, marketing staff, financial managers, regulators, insurance plans, accreditation agencies, purchasers, coalitions, and other customers. DISCUSSION Health care organizations respond to these demands in different ways, depending on their size and type. Six aspects of information needs that would be relevant under managed competition are analyzed: standardization, linkages among data banks, risk adjustment, comprehensive institution-based indicators and information systems, comprehensive population-based indicators and information systems, and methods for protecting confidentiality of patient records. RECOMMENDATIONS Six recommendations to hospitals/managed care plans that decide to establish information management systems are made: set goals, set priorities, describe current system, identify external data sources, develop (a plan), and check back (reassess).

Should Drg Assignment Be Based on Age

The present Medicare Diagnosis Related Group (DRG) classification system contains 95 DRG pairs, where one DRG of the pair contains patients within a distinct diagnostic category who are under 70 years of age with no comorbidities or complications (CCs). The other DRG of the pair contains patients in the same diagnostic category who are over 69 or who have CCs. This study examines whether it is appropriate for reimbursement purposes to group those patients who are 70 years of age or older but have no CCs with patients who have CCs. Our findings show that age alone, in the absence of CCs, increases length of stay and cost of care only slightly. In fact, using only CCs as a classification variable reduces the within-group variance more than the present classification based on both age and CCs. Therefore, it is inappropriate to group Medicare patients who are older than 70 years of age without CCs with Medicare patients who have CCs.