Social and Behavioral Sciences Commons^™

Hospital Quality And Medicare Payment: A Theoretical And Empirical Investigation, Jinghua Huang

Wayne State University Dissertations

Does Medicare's payment rate for a hospital stay influence the quality of care received by a patient? We examine this question, theoretically and empirically. First, a model is developed which generates the key hypothesis -- that Medicare's payment rate per admission should be positively related to care quality. We then test this hypothesis by estimating the relationship between Medicare's DRG payment for pneumonia, heart failure and heart attacks and care quality, using clinically-recognized measures of the quality of pneumonia care, heart failure care and heart attack care. Newly available data on acute hospitals in 2007 from "Hospital Compare" (maintained by …