Larger hospital, physician systems didn't lead to better quality, study found

A picture of a hospital corridor
Larger hospital system and physician offices didn't score better quality marks than their smaller counterparts, a new study found. (sfam_photo/Shutterstock)

Large systems of hospitals and physician offices were generally not associated with better quality, a new study found.

The study, published Friday in the journal Health Affairs, touches on the impact of increased consolidation among physician offices and hospitals that has occurred in recent years. Researchers measured how large, interconnected systems fared on nine quality measures that included whether the systems adopted payment reforms.

While there have been studies that showed healthcare consolidation can lead to higher prices and decreased competition, results on the impact of mergers on quality are less certain, the study said.

“Although uncertainty surrounds the drivers of recent organizational changes, health care organizations are becoming larger and more financially integrated, with hospital and health system ownership of medical practices rising sharply in recent years—a trend that is now likely to accelerate,” the study said. “A majority of all hospitals and nearly half of all physicians are now in financially integrated delivery systems.”

Researchers looked at data from the National Survey of Healthcare Organizations and Systems from 2017 and 2018 and compared systems based on their degree of complexity. They compared complex, simple and independent hospital systems through nine quality measures.

A complex system has at least 242 beds compared with a simple system of 180 beds and an independent hospital of 67 beds.

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A complex system also has six hospitals in it versus a simple system with just one.

For physician practices, a complex system had 80 practices within it and simple systems 13, while independent systems had six. The study excluded any data from practices with one or two physicians because they were less likely to invest in quality and payment reforms.

The study found a majority of hospitals in complex systems (82%) and simple systems (83%) were in a payment reform initiative.

The hospitals were then compared to nine measures that include screening for social needs, care of complex and high-need patients, use of electronic health record (EHR)-based decision support and support for care transitions.

Physician offices were also compared to nine similar measures.

“Scores varied widely across hospitals and practices, but little of this variation was explained by ownership status,” the study said.

Among hospitals, there was a statistically significant difference for four of nine quality measures. Independent hospitals had a worse participation in quality-focused payment programs, screening for social needs, use of EHR-based decision support and support for care transitions.

“There were no significant differences in scores comparing hospitals in complex systems with those in simple systems,” the study said.

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Physician practices were also less likely to participate in payment reforms but more likely to screen patients for clinical conditions or social needs.

Independent offices had a worse score for participation in a quality-focused payment program, but those practices had higher scores for screening for clinical conditions and social needs.

“Comparing physician practices across different types of financially integrated systems, significant differences were found for only two of nine measures (participation in quality-focused payment programs and use of EHR-based decision support) but neither favored complex integrated delivery systems,” the study added.

Researchers questioned why systems did not do better in adopting payment reforms, questioning whether there is enough motivation to do so.

“The move away from fee-for-service to value-based payment might not yet be at the tipping point for financially integrated systems to ‘activate’ their potential greater resources and capabilities to implement recommended reforms,” the study said.