Hospital-based skilled nursing facility survival: Organizational and market-level predictors

Area of Science:

• Healthcare Management
• Organizational Ecology
• Health Services Research

Background:

• Healthcare payment reforms, including the prospective payment system (PPS), influenced hospital ownership of skilled nursing facilities (SNFs).
• Despite changes in reimbursement policies, many hospitals continue to operate hospital-based skilled nursing facilities (HBSNFs).

Purpose of the Study:

• To investigate organizational and market factors impacting HBSNF survival.
• To apply the population ecology of organizations framework to understand HBSNF persistence.

Main Methods:

• Analysis of American Hospital Association survey data for U.S. acute care hospitals with HBSNFs from 1998 to 2020.
• Event history analysis using Cox regressions to determine HBSNF closure risks.
• Key variables included hospital size, ownership, financial margin, market competition, and Medicare Advantage penetration.

Main Results:

• HBSNFs in large, not-for-profit hospitals demonstrated increased survival odds.
• HBSNFs in less competitive markets exhibited greater longevity.
• Hospital size and ownership significantly influenced HBSNF survival rates.

Conclusions:

• Findings suggest that hospital size and ownership, alongside market competition, are critical determinants of HBSNF survival.
• Administrators can use these insights to strategically allocate resources, particularly in small, for-profit facilities within competitive markets.
• Maintaining HBSNFs aligns with regulatory emphasis on continuity of care.