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Price Effects Of Vertical Integration And Joint Contracting Between Physicians And Hospitals In Massachusetts.

ABSTRACT: Vertical integration in health care has recently garnered scrutiny by antitrust authorities and state regulators. We examined trends, geographic variation, and price effects of vertical integration and joint contracting between physicians and hospitals, using physician affiliations and all-payer claims data from Massachusetts from the period 2013-17. Vertical integration and joint contracting with small and medium health systems rose from 19.5 percent in 2013 to 32.8 percent in 2017 for primary care physicians and from 26.1 percent to 37.8 percent for specialists. Vertical integration and joint contracting with large health systems slightly declined, whereas geographic variation in these physician affiliations rose. We found that vertical integration and joint contracting led to price increases from 2013 to 2017, from 2.1 percent to 12.0 percent for primary care physicians and from 0.7 percent to 6.0 percent for specialists, with the greatest increases seen in large health systems. These findings can inform policy makers seeking to limit growth in health care prices.

SUBMITTER: Curto V

PROVIDER: S-EPMC10249654 | biostudies-literature | 2022 May

REPOSITORIES: biostudies-literature

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Price Effects Of Vertical Integration And Joint Contracting Between Physicians And Hospitals In Massachusetts.

Curto Vilsa V Sinaiko Anna D AD Rosenthal Meredith B MB

Health affairs (Project Hope) 20220501 5

Vertical integration in health care has recently garnered scrutiny by antitrust authorities and state regulators. We examined trends, geographic variation, and price effects of vertical integration and joint contracting between physicians and hospitals, using physician affiliations and all-payer claims data from Massachusetts from the period 2013-17. Vertical integration and joint contracting with small and medium health systems rose from 19.5 percent in 2013 to 32.8 percent in 2017 for primary ...[more]

PMID: 35500187

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Project description:ObjectiveTo test the association between vertical integration of primary care providers (PCPs) and adherence rates for anti-diabetics, renin angiotensin system antagonists (RASA), and statins.Data sourcesMedicare Part B outpatient fee-for-service claims and Medicare Part D event data from 2014 to 2017.Study designWe estimated difference-in-differences regressions, comparing changes in adherence among patients with PCPs who converted from independent to integrated to changes among patients whose PCPs remained independent or integrated during the study period. To test for heterogenous impacts by patient demographics, we estimated triple difference regressions that included additional interaction terms by comorbidity rates, age group, and race/ethnicity.Extraction methodsWe extracted Medicare claims for adults with continuous enrollment in Parts B and D during the study period.Principal findingsThe proportion of patients who had a vertically integrated PCP increased by approximately 23% over the study period. Changes in adherence did not differ significantly between patients based on whether their PCP became integrated (Statins: 0.18, 95% CI -0.13, 0.49; RASA: -0.13, 95% CI -0.46, 0.19; Anti-Diabetics: -0.20, 95% CI -0.78, 0.38). Among patients with PCPs who became integrated, there were significant decreases in adherence for patients who were Black, Asian, Hispanic, or Native American, above 80 years old, and had greater comorbidities for all three classes.ConclusionsWhile there were no average changes in adherence following vertical integration of PCPs, health equity worsened, with significant declines in adherence for Black, Asian, Hispanic, and Native American patients, patients over 80 years old, and patients with greater comorbidities. These findings suggest that integration may reduce clinicians' incentives to compete based on the quality of care delivered. Given the price increases associated with integration, integration may be a net welfare loss.

Project description:ImportanceVertical relationships (ownership, affiliations, joint contracting) between physicians and health systems are increasing in the US. Many proponents of vertical relationships argue that increased spending associated with consolidation is accompanied by improvements in quality of care.ObjectiveTo assess the association of vertical relationships between primary care physicians (PCPs) and large health systems and quality of care.Design, setting, and participantsThis stacked difference-in-differences study compared outcomes for patients whose attributed PCP entered a vertical relationship with a large system in 2015 or 2017 to patients whose PCP was either never or always in a vertical relationship with a large system from 2013 to 2017. Models account for differences between PCPs, patient characteristics, market concentration, and secular trends. Data were derived from the 2013 to 2017 Massachusetts All-Payer Claims Database. The study population included commercially insured individuals attributed to a PCP in the Massachusetts Health Quality Partners' Massachusetts Provider Database in 2013, 2015, or 2017. Analyses were conducted between January 2021 and January 2024.ExposurePCPs attributed to patients in the study entering a vertical relationship with a large health system in 2015 or 2017.Main outcomes and measuresLow-value care utilization, posthospitalization follow-up, utilization among patients with ambulatory care-sensitive conditions, practice site visit fragmentation, and timeliness of specialty care.ResultsThe study population included 4 603 172 patient-year observations from 2013 to 2017. Among all patients in the study, 53.5% were female, 35.3% had any chronic condition, and the mean (SD) age was 38.9 (20.3) years. There was no association between vertical relationships and low-value care or ambulatory care-sensitive conditions utilization. A patient's PCP entering a vertical relationship had no association with the probability of follow-up within 90 days of cancer diagnosis with any oncologist but was associated with a 7.34-percentage point (pp) (95% CI, 2.28-12.40; P = .01) increase in the probability of follow-up with an oncologist in the health system. Vertical relationships were associated with increased posthospitalization follow-up with a physician in the health system by 7.51 pp (95% CI, 2.96-12.06: P = .001) in the 2015 subgroup. PCP-health system vertical relationships were associated with a significant decrease in fragmentation of practice site visits of -1.05 pp (95% CI, -2.05 to 0.05; P = .04).Conclusions and relevanceIn this study, vertical relationships between PCPs and large health systems were associated with patient steering and changes in care delivery processes, but not necessarily improvements in patient outcomes.

Project description:ImportanceVertical relationships (eg, ownership or affiliations, including joint contracting) between physicians and health systems are increasing in the US.ObjectiveTo analyze how vertical relationships between primary care physicians (PCPs) and large health systems are associated with changes in ambulatory and acute care utilization, referral patterns, readmissions, and total medical spending for commercially insured individuals.Design, setting, and participantsThis case-control study with a repeated cross-section, stacked event design analyzed outcomes of patients whose attributed PCP entered a vertical relationship with a large health care system in 2015 or 2017 compared with patients whose attributed PCP was either never or always in a vertical relationship with a large health system from 2013 to 2017 in the state of Massachusetts. The sample consisted of commercially insured patients who met enrollment criteria and who were attributed to PCPs who were included in the Massachusetts Provider Database in 2013, 2015, and 2017 and for whom vertical relationships were measured. Enrollee and claims data were obtained from the 2013 to 2017 Massachusetts All-Payer Claims Database. Statistical analyses were conducted between January 5, 2021, and June 5, 2023.ExposureEvaluation-and-management visit with attributed PCP in 2015 to 2017.Main outcomes and measuresOutcomes (which were measured per patient-year [ie, per patient per year from January to December] in this sample) were utilization (count of specialist physician visits, emergency department [ED] visits, and hospitalizations overall and within attributed PCP's health system), spending (total medical expenditures and use of high-price hospitals), and readmissions (readmission rate and use of hospitals with a low readmission rate).ResultsThe sample of 4 030 224 observations included 2 147 303 females (53.3%) and 1 881 921 males (46.7%) with a mean (SD) age of 35.07 (19.95) years. Vertical relationships between PCPs and large health systems were associated with an increase of 0.69 (95% CI, 0.34-1.04; P < .001) in specialist visits per patient-year, a 22.64% increase vs the comparison group mean of 3.06 visits, and a $356.67 (95% CI, $77.16-$636.18; P = .01) increase in total medical expenditures per patient-year, a 6.26% increase vs the comparison group mean of $5700.07. Within the health care system of the attributed PCPs, the number of specialist visits changed by 0.80 (95% CI, 0.56-1.05) per patient year (P < .001), a 29.38% increase vs the comparison group mean of 2.73 specialist visits per patient-year. The number of ED visits changed by 0.02 (95% CI, 0.01-0.03) per patient year (P = .001), a 14.19% increase over the comparison group mean of 0.15 ED visits per patient-year. The number of hospitalizations changed by 0.01 (95% CI, 0.00-0.01) per patient-year (P < .001), a 22.36% increase over the comparison group mean of 0.03 hospitalizations per patient-year. There were no differences in readmission outcomes.ConclusionsResults of this case-control study suggest that vertical relationships between PCPs and large health systems were associated with steering of patients into health systems and increased spending on patient care, but no difference in readmissions was found.

Dataset Information

Price Effects Of Vertical Integration And Joint Contracting Between Physicians And Hospitals In Massachusetts.

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Price Effects Of Vertical Integration And Joint Contracting Between Physicians And Hospitals In Massachusetts.

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