Measuring teaching intensity with the resident-to-average daily census ratio

Area of Science:

• Health economics
• Healthcare policy
• Medical education funding

Background:

• Medicare's indirect medical education (IME) adjustment is crucial for teaching hospital funding.
• The current calculation relies on teaching intensity, often measured by resident-to-bed ratios.
• Potential changes to this metric could significantly impact hospital reimbursement.

Purpose of the Study:

• To analyze the impact of replacing hospital beds with average daily census (ADC) in the IME adjustment calculation.
• To evaluate how this change affects teaching hospitals, particularly those with varying occupancy rates.
• To compare the effects under different Medicare prospective payment system (PPS) adjustment formulas.

Main Methods:

• Comparative analysis of resident-to-bed ratios versus resident-to-ADC ratios.
• Examination of Medicare's indirect medical education (IME) adjustment formula.
• Simulation of the impact on hospitals with different program sizes and occupancy rates.

Main Results:

• Hospitals with smaller teaching programs and lower occupancy rates would benefit more from using ADC.
• The capital prospective payment system (PPS) formula would mitigate some of the effects compared to the operating PPS formula.
• Despite ADC's higher average variability, resident-to-ADC and resident-to-bed ratios showed similar weighted average rates of change.

Conclusions:

• Switching to ADC as a measure for teaching intensity in IME adjustments could disproportionately benefit smaller teaching hospitals.
• Policy adjustments may be needed to ensure equitable reimbursement across different hospital types.
• The choice of PPS adjustment formula influences the financial impact of this proposed change.