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Multihospital System Membership and Patient Treatments, Expenditures, and Outcomes


  • Kristin Madison

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    • Address correspondence to Kristin Madison, J.D., Ph.D., Assistant Professor, University of Pennsylvania Law School, and Senior Fellow, Leonard Davis Institute of Health Economics, 3400 Chestnut St., Philadelphia, PA 19104.

  • This research was supported by a National Science Foundation graduate fellowship, a Health Care Financing Administration dissertation fellowship grant, and a 2001 academic year research fellowship sponsored by the John M. Olin Program in Law and Economics at Stanford Law School. Any opinions, findings, conclusions, or recommendations expressed in this document are those of the author and do not necessarily reflect the views of the National Science Foundation or the Centers for Medicare and Medicaid Services.


Objective. To determine the relationship between hospital membership in systems and the treatments, expenditures, and outcomes of patients.

Data Sources. The Medicare Provider Analysis and Review dataset, for data on Medicare patients admitted to general medical-surgical hospitals between 1985 and 1998 with a diagnosis of acute myocardial infarction (AMI); the American Hospital Association Annual Survey, for data on hospitals.

Study Design. A multivariate regression analysis. An observation is a fee-for-service Medicare AMI patient admitted to a study hospital. Dependent variables include patient transfers, catheterizations, angioplasties or bypass surgeries, 90-day mortality, and Medicare expenditures. Independent variables include system participation, other admission hospital and patient traits, and hospital and year fixed effects. The five-part system definition incorporates the size and location of the index admission hospital and the size and distance of its partners.

Principal Findings. While the effects of multihospital system membership on patients are in general limited, patients initially admitted to small rural system hospitals that have big partners within 100 miles experience lower mortality rates than patients initially admitted to independent hospitals. Regression results show that to the extent system hospital patients experience differences in treatments and outcomes relative to patients of independent hospitals, these differences remain even after controlling for the admission hospital's capacity to provide cardiac services.

Conclusions. Multihospital system participation may affect AMI patient treatment and outcomes through factors other than cardiac service offerings. Additional investigation into the nature of these factors is warranted.