Redefining the Valuation Methods of Modern Day Hospital Care

Abstract:     
This article discusses the report published last year by the Joint Commission ("Improving America's Hospitals") that seeks to showcase the achievements of hospitals identified as "Top Performers on Key Quality Measures." The Joint Commission's report also provides a comprehensive analysis on the ways in which those hospitals accredited by the organization fared for all quality measures. This article focuses on specific care measures set forth in the report (heart attack care, pneumonia, and one surgical example), and compares these historical trends with the appropriate Medicare reimbursement data for the same time period.

While it comes as no surprise that hospital reimbursements do not share the same trajectory as Joint Commission quality standards, the contradictory manner in which health care regulations reward annual improvement by reducing reimbursements speaks volumes about a system not just in transition, but in a state of confusion. Mindful of the value based purchasing modifications to the Medicare program looming on the horizon, my article suggests that now is an appropriate time to take stock in the collections of data we have amassed as a means to understand and refine the delicate infrastructure of our nation's health care system, with a specific eye toward the ways in which value is assessed and rewarded. As the nation transitions toward a reimbursement policy dictated by performance measures rather than cost, our focus should also be directed toward creating a self-sustaining system that improves the delivery of health care throughout the nation and is fair to both the individuals and institutions that participate therein.

Number of Pages in PDF File: 23

Keywords: Joint Commission, Medicare, DRG, MS-DRG, value based purchasing

JEL Classification: A10, A13, E39, H50, H51, I10, I11, J14, Z00

Accepted Paper Series