title: Do hospitals practice cream skimming?
abstract: 'Cream skimming' refers to choosing patients for some characteristic(s) other than their need for care, which enhances the profitability or reputation of the provider. Under capitation or other fixed payment schemes, this often means choosing less ill patients. We present a new methodology to measure cream skimming by hospitals. Our approach also provides a measure of a hospital's gain in productive efficiency by caring for patients with lower illness severity. Using a panel of Washington state hospitals, we find evidence that hospitals do practice cream skimming. However, we find little evidence to suggest that cream skimming varies by hospital size, profit status or time.
authors.affiliation: College of Pharmacy, Nursing and Allied Sciences, North Dakota State University, Sudro Hall, Fargo, ND, USA. freisner@jepson.gonzaga.edu
authors.forename: Daniel L
authors.initials: DL
authors.lastname: Friesner
authors.forename: Robert
authors.initials: R
authors.lastname: Rosenman
mesh_terms: D004465:Economic Competition / Q000458:organization & administration*; D004469:Economics, Hospital / Q000458:organization & administration* / Q000639:trends; D017598:Efficiency, Organizational / Q000191:economics; D036262:Empirical Research; D006276:Health Facility Size / Q000191:economics; D012106:Research; D014861:Washington