Abstract
We study how for-profit and religious nonprofit hospices respond to an exogenous Medicare reimbursement incentive that encourages maximization of patient length of stay. Hospices have the incentive to selectively admit patients with longer expected lengths of stay, and admit patients sooner after a hospital discharge. We find that for-profit hospices are significantly less likely to admit patients with shorter, less profitable, expected lengths of stay. We do not find any difference in the timing of admission by ownership. Incentives for efficiency could be strengthened by a Medicare pricing system that replaced the current flat per diem payment with one that reflected the high costs at the beginning and end of hospice stay and the lower costs in between.
| Original language | English |
|---|---|
| Pages (from-to) | 342-357 |
| Number of pages | 16 |
| Journal | Journal of Health Economics |
| Volume | 26 |
| Issue number | 2 |
| DOIs | |
| State | Published - Mar 1 2007 |
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Keywords
- Hospice care
- Long-term care
- Medicare
- Nonprofit hospices
- Ownership differences
ASJC Scopus subject areas
- Economics and Econometrics
Cite this
Do religious nonprofit and for-profit organizations respond differently to financial incentives? The hospice industry. / Lindrooth, Richard C.; Weisbrod, Burton A.
In: Journal of Health Economics, Vol. 26, No. 2, 01.03.2007, p. 342-357.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - Do religious nonprofit and for-profit organizations respond differently to financial incentives? The hospice industry
AU - Lindrooth,Richard C.
AU - Weisbrod,Burton A.
PY - 2007/3/1
Y1 - 2007/3/1
N2 - We study how for-profit and religious nonprofit hospices respond to an exogenous Medicare reimbursement incentive that encourages maximization of patient length of stay. Hospices have the incentive to selectively admit patients with longer expected lengths of stay, and admit patients sooner after a hospital discharge. We find that for-profit hospices are significantly less likely to admit patients with shorter, less profitable, expected lengths of stay. We do not find any difference in the timing of admission by ownership. Incentives for efficiency could be strengthened by a Medicare pricing system that replaced the current flat per diem payment with one that reflected the high costs at the beginning and end of hospice stay and the lower costs in between.
AB - We study how for-profit and religious nonprofit hospices respond to an exogenous Medicare reimbursement incentive that encourages maximization of patient length of stay. Hospices have the incentive to selectively admit patients with longer expected lengths of stay, and admit patients sooner after a hospital discharge. We find that for-profit hospices are significantly less likely to admit patients with shorter, less profitable, expected lengths of stay. We do not find any difference in the timing of admission by ownership. Incentives for efficiency could be strengthened by a Medicare pricing system that replaced the current flat per diem payment with one that reflected the high costs at the beginning and end of hospice stay and the lower costs in between.
KW - Hospice care
KW - Long-term care
KW - Medicare
KW - Nonprofit hospices
KW - Ownership differences
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UR - http://www.scopus.com/inward/citedby.url?scp=33847179439&partnerID=8YFLogxK
U2 - 10.1016/j.jhealeco.2006.09.003
DO - 10.1016/j.jhealeco.2006.09.003
M3 - Article
VL - 26
SP - 342
EP - 357
JO - Journal of Health Economics
T2 - Journal of Health Economics
JF - Journal of Health Economics
SN - 0167-6296
IS - 2
ER -