Authors

  1. Ghosh, Arnab K. MD, MSc, MA
  2. Ibrahim, Said MD, MPH, MBA
  3. Lee, Jennifer MD
  4. Shapiro, Martin F. MD, PhD, MPH
  5. Ancker, Jessica PhD, MPH

Abstract

Backgroung and Objectives: Under the Affordable Care Act, the US Centers for Medicare & Medicaid Services created the Physician Value-Based Payment Modifier Program and its successor, the Merit-Based Incentive Payment System, to tie physician payments to quality and cost. The addition of hospital length of stay (LOS) to these value-based physician payment models reflects its increasing importance as a metric of health care cost and efficiency and its association with adverse health outcomes. This study compared the Centers for Medicare & Medicaid Services-endorsed LOS risk-adjustment methodology with a novel methodology that accounts for pre-hospitalization clinical, socioeconomic status (SES), and admission-related factors as influential factors of hospital LOS.

 

Methods: Using the 2014 New York, Florida, and New Jersey State Inpatient Database, we compared the observed-to-expected LOS of 2373102 adult admissions for 742 medical and surgical diagnosis-related groups (DRGs) by 3 models: (a) current risk-adjustment model (CRM), which adjusted for age, sex, number of chronic conditions, Elixhauser comorbidity score, and DRG severity weight, (b) CRM but modeling LOS using a generalized linear model (C-GLM), and (c) novel risk-adjustment model (NRM), which added to the C-GLM covariates for race/ethnicity, SES, discharge destination, weekend admission, and individual intercepts for DRGs instead of severity weights.

 

Results: The NRM disadvantaged physicians for fewer medical and surgical DRGs, compared with both the C-GLM and CRM models (medical DRGs: 0.49% vs 13.17% and 10.89%, respectively; surgical DRGs: 0.30% vs 13.17% and 10.98%, respectively). In subgroup analysis, the NRM reduced the proportion of physician-penalizing DRGs across all racial/ethnic and socioeconomic groups, with the highest reduction among Whites, followed by low SES patients, and the lowest reduction among Hispanic patients.

 

Conclusions: After accounting for pre-hospitalization socioeconomic and clinical factors, the adjusted LOS using the NRM was lower than estimates from the current Centers for Medicare & Medicaid Services-endorsed model. The current model may disadvantage physicians serving communities with higher socioeconomic risks.