1. NHQR Efficiency Measurement: Potentially Avoidable Hospitalization Trends & Costs Roxanne M. Andrews, Ph.D. Agency for Healthcare Research and Quality Center for Delivery, Organization, and Markets September 14, 2009

2. What are potentially avoidable hospitalizations? Hospitalizations that may be preventable with high quality primary & preventive care Hospitalizations that may be preventable with high quality primary & preventive care Commonly measured by examining hospitalizations for specific conditions— Commonly measured by examining hospitalizations for specific conditions— “ambulatory care sensitive conditions” Example: Asthma Example: Asthma – Patients may be hospitalized for asthma if they do not receive adequate outpatient care, or primary care practitioners do not adhere to practice guidelines or prescribe appropriate treatments. As an efficiency measure, it is assumed that hospitalizations for these conditions are more costly than good quality outpatient care. As an efficiency measure, it is assumed that hospitalizations for these conditions are more costly than good quality outpatient care.

3. How are potentially avoidable hospitalizations measured in the NHQR? AHRQ Prevention Quality Indicators (PQIs) AHRQ Prevention Quality Indicators (PQIs) – One module of the AHRQ Quality Indicators software – Set of measures to identify hospitalizations for "ambulatory care sensitive conditions" (ACSCs) in adult populations. PQIs use existing hospital discharge data, based on readily available data elements PQIs use existing hospital discharge data, based on readily available data elements PQIs adjust for age and gender of the population PQIs adjust for age and gender of the population All the hospitalizations are not preventable, but these are areas where improvements in outpatient & preventive care could reduce U.S. hospital costs All the hospitalizations are not preventable, but these are areas where improvements in outpatient & preventive care could reduce U.S. hospital costs

4. Prevention Quality Indicators (PQIs) Composite Measures Chronic – Diabetes complications - short term – Diabetes complications - long term – Uncontrolled diabetes – Lower extremity amputation – COPD – Hypertension – Congestive heart failure – Angina without procedure – Adult asthma Acute – Dehydration – Bacterial pneumonia – Urinary tract infection 4

5. Data Source: Nationwide Inpatient Sample Part of the Healthcare Cost and Utilization Project family of databases Part of the Healthcare Cost and Utilization Project family of databases Designed for national estimates related to U.S. hospitalizations Designed for national estimates related to U.S. hospitalizations Uses all-payer hospital administrative (billing) data Uses all-payer hospital administrative (billing) data Based on data supplied by state data organizations Based on data supplied by state data organizations A 20% stratified sample of U.S. hospitals (all discharges from the hospital) A 20% stratified sample of U.S. hospitals (all discharges from the hospital)

6. Measures in the NHQR Trends in PQI composite rates Trends in PQI composite rates – Per 100,000 population Trends in national costs for PQI composite Trends in national costs for PQI composite – Adjust for inflation (gross domestic product implicit price deflator) – Deflate hospital charges to hospital costs using HCUP cost-to-charge ratios – Costs represent the hospitals’ cost of production Not what was paid Not what was paid Does not include physician costs billed separately Does not include physician costs billed separately

7. National trends in potentially avoidable hospitalization rates, by type of condition Note: Adults only. Rates are adjusted for age & gender. Source: Healthcare Cost and Utilization Project, Nationwide Inpatient Sample

8. Trends in national hospital costs of potentially avoidable hospitalizations Note: Adults only. Source : Healthcare Cost and Utilization Project, Nationwide Inpatient Sample

9. Comments Previous literature indicates variations in preventable hospitalization rates by race, SES and geographic location Previous literature indicates variations in preventable hospitalization rates by race, SES and geographic location NHDR illustrates variations by race & SES in individual PQIs NHDR illustrates variations by race & SES in individual PQIs NHQR State Snapshots illustrates variations by State in individual PQIs NHQR State Snapshots illustrates variations by State in individual PQIs AHRQ Preventable Hospitalization Costs mapping software can identify counties with high costs for PQI conditions AHRQ Preventable Hospitalization Costs mapping software can identify counties with high costs for PQI conditions

10. Regional variations in Overall PQI Composite rate Source: Healthcare Cost and Utilization Project, Nationwide Inpatient Sample 0 500 1,000 1,500 2,000 2,500 20002005 Hospitalizations per 100,000 population Northeast Midwest South West

11. Comments Examining the variations in potentially avoidable hospitalizations offer opportunities to identify communities and populations for targeted interventions Examining the variations in potentially avoidable hospitalizations offer opportunities to identify communities and populations for targeted interventions These interventions could lead to improvements in one dimension of efficiency These interventions could lead to improvements in one dimension of efficiency