First, an improved understanding of the association between measured quality today and an organization’s present and future financial margins may provide leaders with valuable evidence to support investments in quality that deliver value to patients. We sought to explore two aspects of financial health: margins (profit divided by revenue) and financial distress-a comprehensive metric of an organization’s financial well-being. Given the debate around investments in quality and financial performance, the aim of our study was to explore the association between measured quality and hospital financial health. Thus, hospital managers may not demonstrate the financial viability of quality strategies within a clearly identifiable timeframe, and they must continuously defend their efforts to invest in improving the quality of patient care. Regarding operational expense reduction, the implementation of process efficiencies or adoption of appropriate use of care may be more costly than anticipated or expected financial results may not materialize. the HRRP penalty is limited to a maximum of 3% for a hospital’s quality performance across selected conditions). It is not clear that the Hospital Compare website provides sufficient information for patients to make condition-specific decisions nor is it evident that the revenue adjustments of the value-based quality programs are substantial enough to drive managerial change (e.g. An alternative possibility is that these investments do not offer revenue gains or lower expenses. Outside of revenue adjustments, additional financial incentives to improve quality may arise from reduced operating expenses, as quality improvement can help avoid process inefficiencies, overuse, and preventable harms. Hospital Value-based Purchasing Program, Hospital Acquired Conditions Program). One possibility is that high-quality hospitals may enjoy increased revenue by acquiring additional patients through reputation or by avoiding negative revenue implications as would be imposed by the Hospital Readmissions Reduction Program (HRRP) or other quality-based payment programs (e.g. ĭespite the clinical advantages of high-quality care, there remains uncertainty regarding the financial performance of hospitals that deliver excellent quality care. However, these expenses may negatively affect hospitals’ profit margins and create additional economic risks, and hospital leadership may not be certain that these investments in quality make financial sense in a competitive marketplace. Across inpatient quality improvement activities, hospitals may spend between $2 million to $21 million ($200 to $400 per discharge or 1% to 2% of total operating revenue) each year. Hospitals vary in how much money they spend on infection preventionists, safety specialists, medical directorships, and additional roles and resources designed to improve quality. For example, the National Surgical Quality Improvement Program requires hiring at least one full-time nurse abstractor and paying an annual participation fee. However, quality improvement activities require substantial financial investments on the part of hospital leadership. Quality improvement provides tangible benefits to patients. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.Ĭompeting interests: The authors have declared that no competing interests exist. The Hospital Compare data are publicly available from Medicare & Medicaid Services ( ).įunding: SE was supported by the National Institutes of Health Research Training in Alimentary Tract Surgery T32 Fellowship Award (T32DK007754). This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.ĭata Availability: Data cannot be shared publicly because of the agreement with the American Hospital Association regarding access to their data. Received: FebruAccepted: MaPublished: April 20, 2022Ĭopyright: © 2022 Enumah et al. PLoS ONE 17(4):Įditor: María del Carmen Valls Martínez, University of Almería, SPAIN Citation: Enumah SJ, Resnick AS, Chang DC (2022) Association of measured quality with financial health among U.S.
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