Does Physician-Hospital Integration Affect the Quality and Price of Hospital Care?

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Project Summary This project aims to advance our understanding of the association between physician-hospital integration and the quality and price of health care. The Affordable Care Act and changing economic conditions have encouraged the integration of physicians and hospitals. In particular, Accountable Care Organizations (ACOs) incentivize a team of healthcare providers to deliver coordinated patient care, yielding continuity across time and visits. This coordinated care should improve patient outcomes while slowing cost growth, but integration could also enable hospitals to raise prices. Examining both price and quality of care is necessary to determine the implications of physician-hospital integration for consumer welfare. To date, no other study has examined the relationship between physician-hospital integration and quality of care using the wide set of measures we propose. Several studies have examined the relationship between physician-hospital integration and cost or prices, but the data used in these studies has been limited to a few states, hospital systems, or insurers. In addition, few studies have utilized recent data, with mixed results. Our analysis will be timely and examine data at a nationwide level. Our goal is to compare different levels of physician-hospital integration in order to provide information on how integration may affect the quality and price of healthcare. Specifically, we seek to answer the following questions: 1. How do changes in physician-hospital integration affect the timeliness and quality of care? 2. Does increased physician-hospital integration improve the patient experience? 3. Is increased physician-hospital integration associated with lower health care prices? To respond to the queries set forth in the above aims, we would like to conduct a before versus after regression analysis of integration using a combination of panel data from the American Hospital Association Annual Survey, Medicare Hospital Compare database, and multiple state databases that collect detailed hospital-level financial reports for the years 2008-2013. The Medicare Hospital Compare database provides a novel opportunity to examine quality of care measured by timeliness and effectiveness of care for specific conditions (e.g., acute myocardial infarction, heart failure, and stroke care; 30 day readmission rates) and patient experience (e.g. communication with doctors/nurses).