Hospital Use of Skilled Nursing Facilities Linked to Mortality, Spending

Patients at hospitals with high rates of skilled nursing facility (SNF) discharge usually have poorer outcomes and higher downstream spending, according to researchers from Massachusetts Institute of Technology and Vanderbilt University.

The authors determined that spending on post-acute care in SNFs was a key signal of inefficiency in the healthcare system. The study was published online as a National Bureau of Economic Research working paper.

“We can’t really attribute our finding to one or the other,” co-author John Graves, PhD, assistant professor of Health Policy and Medicine at Vanderbilt University, admitted in a statement. “If it’s the SNFs that are poor quality, that could explain why we’re finding that that type of spending is inefficient, in the sense that we’re spending more and getting worse outcomes. Or it could reflect poor quality on the inpatient side: the patients just aren’t ready to go home because they got poor quality while they were in the hospital, so they need to rely on SNFs for post-acute care.”

The investigators determined that patients assigned to hospitals with high average levels of downstream spending have substantially higher mortality rates compared with patients receiving lower amounts of such care. In addition, when the authors investigated the categories of post-acute care, they found the positive relationship between downstream spending and mortality is concentrated at SNFs. Overall, SNF spending accounts for 40% of post-acute care spending.

The authors tracked one-year post-emergency mortality for patients who were randomly assigned to local hospitals by tracking claims data from more than 1.5 million Medicare patients who needed immediate hospital care for emergencies like hip fracture, femur fracture, and intracerebral hemorrhage.

“Our findings are consistent with recent work that points to post-acute care as a potential culprit for waste in the U.S. system…” the authors wrote.

There is hope that payment reform proposals that bundle payments to providers for 90 days after a hospitalization and penalize hospitals for readmissions within 30 days of discharge could incentivize coordinated care across inpatient and outpatient facilities and lead to a reduction in costs while improving health.

“Penalizing hospitals as well for high post-acute spending, and in particular for high rates of SNF use, may deliver better outcomes while reducing Medicare spending,” the authors concluded.