title: Development of a scalar hospital-specific severity of illness measure.
abstract: Cost-function analysis of hospitals has been criticized for not including severity adjustments. We tested a scalar hospital-specific severity index, derived from Admission MedisGroup Scores. Alternative versions (i.e., linear/nonlinear) of the index were evaluated by estimating cost functions on a sample of 201 Pennsylvania hospitals. The scalar index was a strong predictor of costs. The results also suggest that the omission of a severity variable in a hospital cost function may cause a specification error.
authors.affiliation: Department of Health, School of Management, Widener University, Chester, PA 19013.
authors.forename: M D
authors.initials: MD
authors.lastname: Rosko
authors.forename: C E
authors.initials: CE
authors.lastname: Carpenter
mesh_terms: D003365:Costs and Cost Analysis / Q000379:methods; D003430:Cross-Sectional Studies; D003953:Diagnosis-Related Groups / Q000191:economics; D005102:Health Expenditures; D006769:Hospitals, General / Q000191:economics* / Q000706:statistics & numerical data; D015233:Models, Statistical; D010414:Pennsylvania; D012044:Regression Analysis; D012720:Severity of Illness Index