Long-Term Care Hospitals: A Case Study in Waste / Liran Einav, Amy Finkelstein, Neale Mahoney.

Format:

Book

Author/Creator:

Einav, Liran.

Contributor:

National Bureau of Economic Research.

Finkelstein, Amy.

Mahoney, Neale.

Series:

Working Paper Series (National Bureau of Economic Research) no. w24946.

NBER working paper series no. w24946

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Long-Term Care Hospitals

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2018.

Summary:

There is substantial waste in U.S. healthcare, but little consensus on how to identify or combat it. We identify one specific source of waste: long-term care hospitals (LTCHs). These post-acute care facilities began as a regulatory carve-out for a few dozen specialty hospitals, but have expanded into an industry with over 400 hospitals and $5.4 billion in annual Medicare spending in 2014. We use the entry of LTCHs into local hospital markets and an event study design to estimate LTCHs' impact. We find that most LTCH patients would have counterfactually received care at Skilled Nursing Facilities - post-acute care facilities that provide medically similar care to LTCHs but are paid significantly less - and that substitution to LTCHs leaves patients unaffected or worse off on all dimensions we can objectively measure. Our results imply that Medicare could save about $4.6 billion per year - with no harm to patients - by not allowing for discharge to LTCHs.

Notes:

Print version record

August 2018.