1. The Effect of Hospitals’ Post-Acute Care Ownership on Medicare Post-Acute Care Use 1. Department of Family and Community Medicine, University of Missouri-Columbia 2. Division of Health Services Research and Policy, University of Minnesota 3. Office of Medical Research/Biostatistics, University of Missouri-Columbia Wen-Chieh Lin, PhD 1 Robert L. Kane, MD 2 David R. Mehr, MD, MS 1 Richard W. Madsen, PhD 3 Greg F. Petroski, PhD 3 Funding Sources: Agency for Healthcare Research and Quality

2. Post-Acute Care (PAC) Replace a portion of hospital care – Hospitals discharge patients as soon as medically possible – Hospitals minimize resources used through shortened length of stay Medicare PAC payment system reforms – New financial incentives for PAC settings, but not to hospitals directly – More influential on hospitals owning PAC settings

3. Study Objectives To examine the association between PAC use and hospitals’ PAC ownership To examine the relationship between PAC use and changes in hospitals’ PAC ownership, i.e., added or discontinued PAC ownership, between 1996 and 2000 (pre- and post- payment reforms on HHAs and SNFs)

4. Data 5% Medicare beneficiary sample in year 2000 6 disease groups with the most frequent PAC utilization – Rehabilitative conditions Stroke, hip and knee procedures, and hip fracture – Medical conditions Chronic obstructive pulmonary disease (COPD), pneumonia, and congestive heart failure (CHF)

5. Statistical Analysis Multinomial logit regression – Dependent variable: immediate type of PAC service used after hospital discharge SNF, IRF, HHA, and No Service (reference) – Independent variables Patient characteristics Hospital characteristics Market area characteristics

6. Hospitals’ PAC Ownership Own rehabilitation unit – a hospital has a PPS exempt rehabilitation unit Own SNF – related hospitals for SNFs indicating hospital-based Own swing bed – a hospital provides swing bed services Own home care – home care services are provided by staff

7. The Number and Proportion of Hospitals owning PAC Settings Hospitals’ PAC Ownership CY 1996CY 1998CY 2000 Number of hospitals in our study sample 4,7614,6384,427 Rehabilitation unit845 (17.7%)887 (19.1%)909 (20.5%) Skilled nursing facility1,795 (37.7%)1,913 (41.2%)1,634 (36.9%) Swing bed1,256 (26.4%)1,242 (26.8%)1,176 (26.6%) Home care unit2,012 (42.3%)2,123 (45.8%)2,041 (46.1%)

8. The Association between PAC Use and Hospitals’ PAC Ownership Rehabilitative Conditions (ORs and 95% CIs) SNF vs. No Service IRF vs. No Service HHA vs. No Service Own rehabilitation unit0.78 (0.69, 0.87)2.07 (1.83, 2.33)0.85 (0.74, 0.99) Own SNF1.68 (1.52, 1.85)0.67 (0.59, 0.77)0.84 (0.74, 0.96) Own swing bed1.66 (1.46, 1.88)0.65 (0.53, 0.80)1.03 (0.85, 1.24) Own home care1.18 (1.08, 1.29)0.92 (0.82, 1.03)1.00 (0.89, 1.12) Own SNF & rehab. unit0.78 (0.69, 0.89)1.28 (1.10, 1.49)1.02 (0.86, 1.21) Own SNF & home care0.91 (0.80, 1.03)1.02 (0.88, 1.18)0.99 (0.84, 1.17) Own rehab. Unit & home care0.99 (0.87, 1.13)1.16 (1.00, 1.34)1.19 (1.00, 1.42)

9. The Association between PAC Use and Hospitals’ PAC Ownership (Contd.) Medical Conditions (ORs and 95% CIs) SNF vs. No Service HHA vs. No Service Own rehabilitation unit0.98 (0.92, 1.04)1.04 (0.97, 1.10) Own SNF1.26 (1.19, 1.33)0.87 (0.82, 0.92) Own swing bed1.36 (1.24, 1.49)0.84 (0.76, 0.94) Own home care1.02 (0.92, 1.04)1.03 (0.98, 1.09)

10. Changes in Hospitals’ PAC Ownership Comparing the status of a hospital’s PAC ownership between 1996 and 2000 (pre- and post- payment reforms on HHAs and SNFs) – Yes in 1996 and Yes in 2000 – No in 1996 and Yes in 2000 – Yes in 1996 and No in 2000 – No in 1996 and No in 2000 (reference category)

11. The Association between PAC Use and Changes in Hospitals’ PAC Ownership Rehabilitative ConditionsSNF vs. No serviceIRF vs. No ServiceHHA vs. No service Own rehabilitation unit Yes 1996 – Yes 20000.77 (0.68, 0.86)2.04 (1.80, 2.31)0.85 (0.73, 0.99) No 1996 – Yes 20000.91 (0.76, 1.10)2.27 (1.88, 2.75)0.83 (0.64, 1.08) Yes 1996 – No 20000.95 (0.66, 1.37)0.57 (0.32, 1.03)0.89 (0.52, 1.53) Own SNF Yes 1996 – Yes 20001.67 (1.50, 1.85)0.68 (0.59, 0.78)0.85 (0.74, 0.98) No 1996 – Yes 20001.53 (1.33, 1.75)0.67 (0.56, 0.80)0.79 (0.65, 0.96) Yes 1996 – No 20000.86 (0.75, 0.98)1.14 (0.99, 1.30)1.08 (0.92, 1.27) Own swing bed Yes 1996 – Yes 20001.73 (1.50, 1.98)0.64 (0.51, 0.81)1.02 (0.83, 1.25) No 1996 – Yes 20001.22 (0.92, 1.62)0.67 (0.44, 1.03)1.03 (0.68, 1.55) Yes 1996 – No 20001.28 (0.87, 1.88)1.11 (0.67, 1.84)1.04 (0.58, 1.84) Own home care Yes 1996 – Yes 20001.18 (1.07, 1.30)0.93 (0.82, 1.04)1.02 (0.90, 1.15) No 1996 – Yes 20001.25 (1.08, 1.44)0.92 (0.78, 1.10)0.87 (0.71, 1.06) Yes 1996 – No 20001.21 (1.02, 1.43)1.17 (0.96, 1.43)1.31 (1.06, 1.64)

12. The Association between PAC Use and Changes in Hospitals’ PAC Ownership Medical ConditionsSNF vs. No serviceHHA vs. No service Own rehabilitation unit Yes 1996 – Yes 20000.98 (0.92, 1.05)1.02 (0.96, 1.09) No 1996 – Yes 20000.94 (0.82, 1.08)1.06 (0.93, 1.21) Yes 1996 – No 20001.02 (0.74, 1.41)0.76 (0.52, 1.11) Own SNF Yes 1996 – Yes 20001.25 (1.18, 1.32)0.87 (0.82, 0.93) No 1996 – Yes 20001.35 (1.22, 1.49)0.90 (0.81, 1.00) Yes 1996 – No 20001.02 (0.91, 1.15)1.07 (0.96, 1.20) Own swing bed Yes 1996 – Yes 20001.33 (1.21, 1.47)0.80 (0.72, 0.90) No 1996 – Yes 20001.19 (0.95, 1.48)0.98 (0.76, 1.26) Yes 1996 – No 20001.37 (1.05, 1.79)0.86 (0.61, 1.20) Own home care Yes 1996 – Yes 20001.03 (0.97, 1.09)1.04 (0.98, 1.10) No 1996 – Yes 20001.05 (0.94, 1.17)1.04 (0.93, 1.17) Yes 1996 – No 20001.17 (1.01, 1.36)1.07 (0.92, 1.25)

13. Conclusions The link between PAC use and hospitals’ PAC ownership remained significant in the post-BBA era A hospital’s PAC ownership was associated with an increased use in this PAC modality, while the likelihood of using other PAC modalities decreased Substitution between PAC modalities is also driven by hospitals’ PAC ownership

14. Limitations Data cover only the initial period (1996 to 2000) of the BBA changes on PAC services – October 2000: HHA prospective payment system – January 2002: IRF prospective payment system Analyses did not include the partnership and contractual relationship between hospitals and PAC settings

15. Discussion Discharging patients to hospitals’ own PAC setting – Improve information sharing – Reduce adverse outcomes during the transition – Unknown whether outcomes are comparable in alternative settings Implications of outcomes and costs of substitution between PAC settings