Quality Improvement Spillovers: Evidence From the Hospital Readmissions Reduction Program

40 Pages Posted: 4 Mar 2018 Last revised: 12 Aug 2021

See all articles by Mohamad Soltani

Mohamad Soltani

University of Alberta, Alberta School of Business

Robert Batt

Wisconsin School of Business

Hessam Bavafa

University of Wisconsin - Madison - School of Business

Date Written: August 12, 2021

Abstract

Problem Definition: Quality knowledge spillover can enhance the total effectiveness of quality improvement initiatives. Whereas prior research has shown limited quality improvement spillovers in manufacturing settings, we study the presence and moderators of quality improvement spillovers in a service setting, specifically hospital inpatient care.
Methodology/Results: Focusing on a national healthcare quality improvement policy, the Hospital Readmissions Reduction Program (HRRP), we employ several triple-differences models on two large databases at the state and national level and find positive quality spillovers in the healthcare setting. Specifically, we show that HRRP led to a significant improvement in 30-day readmissions for those with non-targeted clinical conditions or insurance types. In addition, we identify task similarity and operational focus as two contributing factors that impact quality spillovers positively and negatively, respectively. Further, we show that hospitals gain these quality improvement achievements without intensifying care provided. To the contrary, meaningful quality improvements led to up to 3% reduction in hospitalization costs.
Managerial Implications: This paper contributes new insights on how policy makers can propose narrow public policies that achieve broader results by exploiting beneficial quality improvement spillovers.

Keywords: Healthcare, Service operations, Quality knowledge, Quality spillover, Focus, Public policy, Empirical

Suggested Citation

Soltani, Mohamad and Batt, Robert and Bavafa, Hessam, Quality Improvement Spillovers: Evidence From the Hospital Readmissions Reduction Program (August 12, 2021). Available at SSRN: https://ssrn.com/abstract=3132770 or http://dx.doi.org/10.2139/ssrn.3132770

Mohamad Soltani (Contact Author)

University of Alberta, Alberta School of Business ( email )

Edmonton
Canada

HOME PAGE: http://https://apps.ualberta.ca/directory/person/soltani

Robert Batt

Wisconsin School of Business ( email )

975 University Avenue
Madison, WI 53706
United States

Hessam Bavafa

University of Wisconsin - Madison - School of Business ( email )

975 University Ave
4284C Grainger Hall
Madison, WI 53706
United States

HOME PAGE: http://https://bus.wisc.edu/faculty/hessam-bavafa

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