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Direct and Spillover Effects of Medicare Payment Changes on Nursing Home Quality and Volume

Award Number: R03HS025529
ORGANIZATION: AGENCY FOR HEALTH CARE RESEARCH AND QUALITY
OPDIV: AHRQ
AWARD CLASS: DISCRETIONARY
AWARD ACTIVITY TYPE: SCIENTIFIC/HEALTH RESEARCH (INCLUDES SURVEYS)
PERIOD OF PERFORMANCE START DATE: 08/01/2018
PERIOD OF PERFORMANCE END DATE: 07/31/2019

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Direct and Spillover Effects of Medicare Payment Changes on Nursing Home Quality and Volume - Project Summary/Abstract This project examines the causal effects of Medicare payment rates on Skilled Nursing Facility (SNF) volume and quality by exploiting an exogenous geographic realignment that changed prospective payment rates to SNFs. Even as value-based payments develop, prospective payment systems (PPSs) remain important to healthcare providers and policymakers. In 2017, the Medicare Payment Advisory Committee (MedPAC) recommended freezing or reducing Medicare PPS payments for various healthcare providers and, in 2010, the Affordable Care Act (ACA) authorized $200 billion in Medicare payment cuts over 10 years. These types of payment cuts could significantly reduce healthcare providers' profits and have direct effects on the amount and quality of care provided to Medicare beneficiaries, as well as harmful spillover effects on quality and access for private-pay and Medicaid patients. The prior literature does not offer clear guidance on these effects. Most studies of Medicare SNF payment focus on the introduction of PPS and estimate the average effects of PPS across all facilities, even though some SNFs experienced increases in Medicare payments under PPS while others experienced decreases. Other studies that simulate facility-specific payment measures are subject to bias because simulated payments are endogenous. The long-term goal of this project is to understand how Medicare payment affects healthcare volume and quality both directly (for Medicare patients) and indirectly (through spillover effects onto other patients). This project has three specific aims: 1) to examine the causal effects of Medicare SNF payment changes on the volume of care provided to Medicare patients, Medicaid residents, and private-pay patients; 2) to examine the causal effects of Medicare SNF payment changes on quality of care, including overall facility quality, Medicare quality, and Medicaid quality; and 3) to examine how interactions between Medicare SNF payment policy and dimensions of the regulatory and state policy context affect the volume and quality of care provided to Medicare, Medicaid, and private-pay patients. By exploiting a change in the hospital wage index (HWI), an area-level adjustment to SNF payments, this project uses a policy-driven, facility-specific Medicare payment change that was unrelated to facility decisions and market conditions. This change allows for the use of a quasi-experimental design and creates a rare opportunity to estimate the causal effects of Medicare payment changes. This project will use facility-level panel data from Nursing Home Compare, the SNF Cost Reports, LTCfocus.org, and the Federal Register. Because of the similarity between the payment changes created by the HWI change and those in the ACA and recent MedPAC proposals, this work will provide evidence about how these subsequent changes will affect SNFs. This proposal also lays the groundwork for informing policymakers about the effects of the ACA's productivity adjustments for hospitals and other healthcare facilities. Importantly, the results will inform legislative debates about state certificate of need laws, state Medicaid payment policy, and federal antitrust regulations.


Issue Date FY	Funding FY	Legal Entity Name	Legal Entity Address	Legal Entity City	Legal Entity State	Legal Entity Zip Code	Legal Entity COUNTY	Legal Entity COUNTRY	Assistance Listing	Award Code	Budget Year	Action Date	Action Type	Action Amount

Issue Date FY: 2020 ( Subtotal = $0 )
2020	2018	SWARTHMORE COLLEGE	500 COLLEGE AVE	SWARTHMORE	PA	19081	DELAWARE	USA	Research on Healthcare Costs, Quality and Outcomes	000	1	11/4/2019	NEW	$0
														Subtotal = $0

Issue Date FY: 2018 ( Subtotal = $99,730 )
2018	2018	SWARTHMORE COLLEGE	500 COLLEGE AVE	SWARTHMORE	PA	19081	DELAWARE	USA	Research on Healthcare Costs, Quality and Outcomes	000	1	7/31/2018	NEW	$99,730
														Subtotal = $99,730

Grand Total All Awards = $99,730

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Direct and Spillover Effects of Medicare Payment Changes on Nursing Home Quality and Volume

Award Number: R03HS025529

ORGANIZATION: AGENCY FOR HEALTH CARE RESEARCH AND QUALITY

OPDIV: AHRQ

AWARD CLASS: DISCRETIONARY

AWARD ACTIVITY TYPE: SCIENTIFIC/HEALTH RESEARCH (INCLUDES SURVEYS)

PERIOD OF PERFORMANCE START DATE: 08/01/2018

PERIOD OF PERFORMANCE END DATE: 07/31/2019

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