Does receiving referral and transfer patients make hospitals expensive?

Area of Science:

• Health Economics
• Hospital Management
• Healthcare Policy

Background:

• Hospital cost per case is a critical metric in healthcare management.
• Understanding factors influencing hospital costs is essential for resource allocation and policy development.
• Previous studies suggest patient characteristics and hospital attributes may affect costs.

Purpose of the Study:

• To investigate the correlation between hospital cost per case and patient transfer rates.
• To examine the relationship between hospital cost per case and the hospital referral index.
• To determine the extent to which transfer and referral status explain higher hospital costs.

Main Methods:

• Analysis of Medicare data from 1984-1985.
• Statistical correlation analysis to assess relationships between variables.
• Regression analysis to control for confounding factors like wage level, case mix, teaching status, location, and bed count.

Main Results:

• Hospital cost per case showed a significant positive correlation with both the percentage of transfer admissions (r=0.314) and the hospital referral index (r=0.512).
• These correlations remained significant after adjusting for multiple hospital-specific variables.
• Higher charges for individual transfer patients accounted for less than one-third of the increased costs in hospitals receiving transfers; referral status did not significantly relate to costs.

Conclusions:

• While patient transfers and referrals are associated with higher hospital costs, they do not fully explain these cost differences.
• Hospitals that receive more transfers and referrals may incur higher costs due to inherent characteristics that attract these patient types.
• Further research is needed to identify the specific features of high-cost hospitals that attract transfers and referrals.