Spending more on inpatient care improves outcomes compared to spending less on initial inpatient care while depending on long-term care facilities, according to a study published in Journal of Health Economics.
The research team analyzed Medicare claims data for hospital admissions from 2002 to 2011. They focused on patients who were 66 years old or more and tracked their one-year mortality statistics. The study's final database included 1.57 million patients.
The study shows the average 90-day spending on patients is almost $27,500 — and for every additional increase in spending (of roughly $8,500), there was a 2-percent reduction in mortality risk. However, the study shows a 5-percent increase in mortality at hospitals that have relatively high rates of spending on nursing facilities.
"We find that patients who go to hospitals that rely more on skilled nursing facilities after discharge, as opposed to getting them healthy enough to return home, are substantially less likely to survive over the following year," said Joseph Doyle, the Erwin H. Schell Professor of Management at Boston-based MIT Sloan School of Management and co-author of the study.