IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v108y2018i11p3232-65.html
   My bibliography  Save this article

Strategic Patient Discharge: The Case of Long-Term Care Hospitals

Author

Listed:
  • Paul J. Eliason
  • Paul L. E. Grieco
  • Ryan C. McDevitt
  • James W. Roberts

Abstract

Medicare's prospective payment system for long-term acute-care hospitals (LTCHs) provides modest reimbursements at the beginning of a patient's stay before jumping discontinuously to a large lump-sum payment after a prespecified number of days. We show that LTCHs respond to the financial incentives of this system by disproportionately discharging patients after they cross the large-payment threshold. We find this occurs more often at for-profit facilities, facilities acquired by leading LTCH chains, and facilities colocated with other hospitals. Using a dynamic structural model, we evaluate counterfactual payment policies that would provide substantial savings for Medicare.

Suggested Citation

  • Paul J. Eliason & Paul L. E. Grieco & Ryan C. McDevitt & James W. Roberts, 2018. "Strategic Patient Discharge: The Case of Long-Term Care Hospitals," American Economic Review, American Economic Association, vol. 108(11), pages 3232-3265, November.
  • Handle: RePEc:aea:aecrev:v:108:y:2018:i:11:p:3232-65
    Note: DOI: 10.1257/aer.20170092
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/aer.20170092
    Download Restriction: no

    File URL: https://www.aeaweb.org/articles/attachments?retrieve=YlIGtUrXhkGtySv3aMa_bx1at08cxvPj
    Download Restriction: no

    File URL: https://www.aeaweb.org/articles/attachments?retrieve=OErgqtB7y2ctJNwhCeivzb7WXdRS0tWO
    Download Restriction: no

    File URL: https://www.aeaweb.org/articles/attachments?retrieve=sNFCgJkKr9tWtN98ViqPvTL6_4i12BwR
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Sam Watson’s journal round-up for 12th November 2018
      by Sam Watson in The Academic Health Economists' Blog on 2018-11-12 15:46:49

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Berta, P.; & De Fraja, G.; & Verzillos, S.;, 2018. "Optimal Healthcare Contracts:Theory and Empirical Evidence from Italy," Health, Econometrics and Data Group (HEDG) Working Papers 18/33, HEDG, c/o Department of Economics, University of York.

    More about this item

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:108:y:2018:i:11:p:3232-65. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael P. Albert). General contact details of provider: http://edirc.repec.org/data/aeaaaea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.