Do physician-owned cardiac hospitals increase utilization?

Area of Science:

• Health economics
• Cardiovascular surgery
• Healthcare management

Background:

• Physician investment in specialty hospitals, particularly cardiac facilities, emerged as a significant trend.
• Concerns exist regarding potential conflicts of interest and shifts in patient selection towards more profitable cases.

Purpose of the Study:

• To investigate whether physician ownership of heart hospitals between 1997-2001 led to an increase in profitable cardiac surgeries for Medicare patients.
• To determine if these hospitals disproportionately selected healthier (more profitable) Medicare patients for cardiac procedures.

Main Methods:

• Analysis of Medicare claims data from 1997-2001.
• Comparison of growth rates in cardiac surgeries between markets with and without physician-owned heart hospitals.
• Examination of patient health status (comorbidity scores) for cardiac surgeries.

Main Results:

• Markets with physician-owned hospitals showed slightly above-average growth in profitable cardiac surgeries, but the increase was small and only statistically significant for bypass surgery.
• No significant increase was observed in the proportion of surgeries performed on healthier Medicare patients in these facilities.
• Results contrast with findings for less-invasive services like diagnostic imaging.

Conclusions:

• Physician investment in heart hospitals during the study period did not lead to a substantial increase in profitable cardiac surgeries or a significant shift towards healthier patients.
• The findings suggest that the financial incentives may not have translated into widespread changes in surgical volume or patient selection for Medicare cardiac procedures in these hospitals.
• Further research is needed to understand the long-term impact and potential variations across different service lines and healthcare markets.