The Relationship between Costs and Quality in Veterans Health Administration Community Living Centers: An Analysis Using Longitudinal Data.

OBJECTIVE: To examine the relationship between cost and quality in Veterans Health Administration (VA) nursing homes (called Community Living Centers, CLCs) using longitudinal data. DATA SOURCES/STUDY SETTING: One hundred and thirty CLCs over 13 quarters (from FY2009 to FY2012) were studied. Costs, resident days, and resident severity (RUGs score) were obtained from the VA Managerial Cost Accounting System. Clinical quality measures were obtained from the Minimum Data Set, and resident-centered care (RCC) was measured using the Artifacts of Culture Change Tool. STUDY DESIGN: We used a generalized estimating equation model with facilities included as fixed effects to examine the relationship between total cost and quality after controlling for resident days and severity. The model included linear and squared terms for all independent variables and interactions with resident days. PRINCIPAL FINDINGS: With the exception of RCC, all other variables had a statistically significant relationship with total costs. For most poorer performing smaller facilities (lower size quartile), improvements in quality were associated with higher costs. For most larger facilities, improvements in quality were associated with lower costs. CONCLUSIONS: The relationship between cost and quality depends on facility size and current level of performance.

Is higher nursing home quality more costly?

Widespread issues regarding quality in nursing homes call for an improved understanding of the relationship with costs. This relationship may differ in European countries, where care is mainly delivered by nonprofit providers. In accordance with the economic theory of production, we estimate a total cost function for nursing home services using data from 45 nursing homes in Switzerland between 2006 and 2010. Quality is measured by means of clinical indicators regarding process and outcome derived from the minimum data set. We consider both composite and single quality indicators. Contrary to most previous studies, we use panel data and control for omitted variables bias. This allows us to capture features specific to nursing homes that may explain differences in structural quality or cost levels. Additional analysis is provided to address simultaneity bias using an instrumental variable approach. We find evidence that poor levels of quality regarding outcome, as measured by the prevalence of severe pain and weight loss, lead to higher costs. This may have important implications for the design of payment schemes for nursing homes.

Outcome, Use of Resources and Their Relationship in the Treatment of AMI, Stroke and Hip Fracture at European Hospitals.

The aim of the present study was to compare the quality (survival), use of resources and their relationship in the treatment of three major conditions (acute myocardial infarction (AMI), stroke and hip fracture), in hospitals in five European countries (Finland, Hungary, Italy, Norway and Sweden). The comparison of quality and use of resources was based on hospital-level random effects models estimated from patient-level data. After examining quality and use of resources separately, we analysed whether a cost-quality trade-off existed between the hospitals. Our results showed notable differences between hospitals and countries in both survival and use of resources. Some evidence would support increasing the horizontal integration: higher degrees of concentration of regional AMI care were associated with lower use of resources. A positive relation between cost and quality in the care of AMI patients existed in Hungary and Finland. In the care of stroke and hip fracture, we found no evidence of a cost-quality trade-off. Thus, the cost-quality association was inconsistent and prevailed for certain treatments or patient groups, but not in all countries.

Quality, cost, and their trade-off in treating AMI and stroke patients in European hospitals.

OBJECTIVES: This study compared the cost and in-hospital mortality of hospital care for two major diseases, acute myocardial infarction (AMI) and stroke, by pooling patient-level data from five European countries (Finland, France, Germany, Spain, and Sweden). We examined whether a cost-quality trade-off existed in these countries by comparing hospital-level costs and survival rates, and whether hospitals which performed well in terms of cost or quality in treating one patient group (AMI) performed well also in treating the other patient group (stroke). METHODS: A fixed-effect probit regression model for survival and the linear model for log costs were used to calculate indicators for hospital quality and cost, which were plotted against each other. FINDINGS: Both with AMI and stroke there were remarkable differences between hospitals and countries in (both crude and adjusted) rates of patients discharged alive. Swedish and French hospitals had lower mortality than hospitals in Germany, Finland and Spain in the care of AMI patients. However, a longer length of stay in Spanish and German hospitals may bias the results in the two countries. The Finnish hospitals seemed to have lower mortality than the other countries' hospitals in the care of stroke patients. There was no correlation at either the national or hospital level in the quality of treatment of these two diseases. We did not find a clear cost-quality trade-off. The only notable exception was Sweden, where the costs for AMI patients were higher in hospitals with the highest quality of care. CONCLUSIONS: Countries should identify the best performing hospitals both in terms of cost and quality in order to learn from hospitals that demonstrate better practice. It is equally important to better understand the reasons behind the observed differences between hospitals in costs and quality.