Relationship between hospital financial performance and publicly reported outcomes

Area of Science:

• Health Services Research
• Hospital Management
• Quality Improvement

Background:

• Hospitals with robust financial performance may exhibit improved publicly reported patient outcomes.
• The relationship between financial health and quality of care is a critical area of study.

Purpose of the Study:

• To examine the association between hospital financial performance and publicly reported patient outcomes.
• To determine if improvements in outcome metrics influence subsequent hospital financial performance.

Main Methods:

• An observational cohort study analyzed financial data from California hospitals (2008, 2012).
• Data were linked with Centers for Medicare and Medicaid Services Hospital Compare metrics.
• Financial performance was assessed by net revenue, operating margin, and total margin; outcomes included 30-day risk-standardized mortality and readmission rates for AMI, CHF, and PNA.

Main Results:

• No consistent link was found between 2008 financial performance and 2008-2011 outcomes for acute myocardial infarction (AMI) and pneumonia (PNA).
• Improved financial performance correlated with a modest increase in congestive heart failure (CHF) mortality rates.
• No significant association was observed between 2008-2011 outcomes and subsequent 2012 financial performance.

Conclusions:

• Robust hospital financial performance is not directly associated with better publicly reported outcomes for AMI, CHF, and PNA.
• Financial incentives, beyond public reporting, may be necessary to motivate high-performing hospitals to enhance patient outcomes.
• Improved quality metrics do not appear to negatively impact hospital revenue.