Investor-Owned Health Systems Linked to Most Low-Value Care

Higher amounts of overuse among health systems were associated with investor ownership and the number of primary care physicians.

Overuse of low-value services was most often seen in healthcare systems that had more beds, had fewer primary care physicians, had more physician practice groups, and were investor-owned, according to a John Hopkins University study published in JAMA Health Forum. 

“Wasteful care is physically, psychologically, and financially harmful to patients,” the researchers stated in the study.

“Health systems may play an important role in the overuse of health care. They balance financial interests when making decisions about strategic consolidations or new service lines, complying with state and federal regulations, and aiming for high-quality care delivery and best patient outcome.”

In the cross-sectional analysis, researchers used Medicare claims between March and August 2021 to identify the utilization of 17 low-value services across 3,735 hospitals. In addition, by using the AHRQ’s Compendium of Health Systems, researchers were able to link hospitals to 676 health systems.

The findings showed that investor-owned health systems had the highest amount of overuse, with an overuse index score of 0.56 higher than those not investor-owned.

“Higher amounts of overuse among health systems were associated with investor ownership and fewer primary care physicians,” stated the researchers.

“The OI is a valuable tool for identifying potentially modifiable drivers of overuse and is adaptable to other levels of investigation, such as the state or region, which might be affected by local policies affecting payment or system consolidation.”

In addition, health systems with more medical groups were more likely to be overusing low-value services. Relative to the lowest tertile, researchers found that health systems with more medical groups had higher overuse index scores. Health systems with a higher bed count had an overuse index score higher by 0.44.

However, major teaching hospitals were less likely to overuse low-value care.

Researchers found no association between overuse and insurance plans owned by a health system. There was also no association of overuse with participation in CMS programs such as accountable care programs or bundled payment programs.

Additionally, the ownership of a Medicare Advantage plan or a Medicaid managed care plan was minimally linked to overuse.

“We encourage future work to use these classifications of health systems to conduct deeper explorations of determinants of overuse,” researchers explained. 

“This may require additional data collection, particularly to better understand the outliers or discordant systems—systems that have characteristics that are associated with overuse and yet are not overusing systems.”

By Sarai Rodriguez

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