A Cost-Identification Analysis of the Economic Implications

date:2015-12-11 click:

Speaker: Chang Liu, Duke-NUS Graduate Medical School

Host: Shuoxun Zhang, Associate Professor, RIEM

Time: 13:50-15:30, Dec. 20, Friday

Venue:  Yide Hall 513, Liulin campus



Research Objective: States have broad discretion to set Medicaid nursing home payment policies. These state policies have significant implications not only to access and quality, but also to healthcare expenditures. Using state Medicaid bed-hold (BH) policies as a case study, this paper presents a simulation model approach to examine the economic implication of state Medicaid policies to both Medicaid and Medicare.

Study Design: A cost-identification analysis using a Markov model of annual per-bed expenditures accounting for seven types of healthcare utilization: custodial nursing home, acute hospitalization, skilled nursing facility, emergency department care, observation stays, outpatient services, and professional Medicare Part B visits. Three perspectives were considered: Medicaid, Medicare, and combined government expenditure. One-way and probabilistic sensitivity analyses were conducted.

Population Studied: All Medicare fee-for-service long-stay residents of urban freestanding NHs with at least 20 beds in the contiguous 48 states in 2009.

Principal Findings: BH policies were associated with increased expenditures due to hospitalization and SNF utilization. The increased Medicare expenditures were largely mitigated when other outpatient expenditures were also considered.

Conclusions: Medicaid bed-hold policies may increase expenditures to the federal

Medicare program as well as indirectly impacting other types of utilizations as care is shifted from outpatient to inpatient settings. The same methodology can be applied to establish the economic impact of other state policies on different populations from various stakeholders’ perspectives including assessing cost implications of state health policies under the Affordable Care Act.