title: Truly inefficient or providing better quality of care? Analysing the relationship between risk-adjusted hospital costs and patients' health outcomes.
abstract: Observed variation in hospital costs may be attributable to differences in patients' health outcomes. Previous studies have resorted to inherently incomplete outcome measures such as mortality or re-admission rates to assess this claim. This study makes use of a novel dataset of routinely collected patient-reported outcome measures (PROMs) linked to inpatient records to (i) access the degree to which cost variation is associated with variation in patients' health gain and (ii) explore how far judgement about hospital cost performance changes when health outcomes are accounted for. We use multilevel modelling to address the clustering of patients in providers and isolate unexplained cost variation. We find some evidence of a U-shaped relationship between risk-adjusted costs and outcomes for hip replacement surgery. For three other procedures (knee replacement, varicose vein and groin hernia surgery), the estimated relationship is sensitive to the choice of PROM instrument. We do not observe substantial changes in cost performance estimates when outcomes are explicitly accounted for.
authors.affiliation: Centre for Health Economics, University of York, York, UK. nils.gutacker@york.ac.uk
authors.forename: Nils
authors.initials: N
authors.lastname: Gutacker
authors.forename: Chris
authors.initials: C
authors.lastname: Bojke
authors.forename: Silvio
authors.initials: S
authors.lastname: Daidone
authors.forename: Nancy J
authors.initials: NJ
authors.lastname: Devlin
authors.forename: David
authors.initials: D
authors.lastname: Parkin
authors.forename: Andrew
authors.initials: A
authors.lastname: Street
mesh_terms: D000368:Aged; D019644:Arthroplasty, Replacement, Hip / Q000191:economics; D019645:Arthroplasty, Replacement, Knee / Q000191:economics; D005260:Female; D006552:Hernia, Inguinal / Q000601:surgery; D017721:Hospital Costs / Q000706:statistics & numerical data*; D006761:Hospitals / Q000592:standards; D006801:Humans; D008297:Male; D008875:Middle Aged; D015233:Models, Statistical; D063868:Patient Outcome Assessment; D011787:Quality of Health Care / Q000191:economics* / Q000706:statistics & numerical data; D020379:Risk Adjustment / Q000191:economics / Q000706:statistics & numerical data; D014648:Varicose Veins / Q000601:surgery