Princeton Study Finds Kids With Public Health Plans Admitted Less Often, With Same Outcomes

Children with public health coverage, such as Medicaid, were less likely to be admitted than those with private plans, according to a Princeton University study of New Jersey hospital admissions.

However, it doesn’t appear that being admitted less often caused any harm, as the study found no difference in health outcomes. If anything, study author Janet Currie, PhD, a Princeton health economist, said the findings may reveal wasteful care and spending.

“In the end, I think we came to kind of a surprising conclusion that maybe the problem isn’t that too few publicly insured children are being hospitalized. Maybe the problem is that too many privately insured children are being hospitalized when they really don’t need it,” Currie said.

The study covered admissions from 2006 to 2012, before the Affordable Care Act (ACA) took full effect. Researchers used data of the NJ Uniform Billing Records, and created a patient-level data set that could follow children across hospitals—which would be key in gleaning whether a decision to not admit had consequences. They also controlled for diagnostic categories to gauge whether children in public plans were admitted less often because they were less likely to be sick, and found this was not the case.

The study did find a reason children with private coverage are more likely to be admitted: “They are being treated for different conditions,” the authors wrote. Of note, the data showed that for asthma, in particular, children with private coverage were more likely to be admitted.

But the real question, the researchers asked, “Does it matter?” Are children with private coverage gaining any benefit from being admitted to the hospital at higher rates? To answer this question, the study examined readmission rates, to see whether children with public health coverage, who should have been admitted were not, ended up back in the emergency department as a result.

“If publicly insured children were suffering from the reduction in admission probabilities during high flu weeks, then we might expect to see evidence of harmful effects in the form of returns to the [emergency room] and future hospital admissions. However, we see no such patterns,” the authors wrote.

“Hence,” they concluded, “Our results raise the possibility that instead of too few publicly insured children being admitted during high flu weeks, there are too many publicly and privately insured children being admitted most of the time.”

Anna Aizer, an associate professor of Economics and Public Policy at Brown University who studies health outcomes for the poor, said in a press release this finding is key.

“This is an important finding that is likely to spur more research examining whether similar patterns are evident in other contexts," Aizer said. "The results will likely have important implications for policy makers interested in understanding and addressing both rising healthcare costs and disparities in health.”

The current study is part of a broader effort to examine the distribution of healthcare, including examples such as heart attacks and cesarean sections, which have high variability rates and have been targeted by the Leapfrog Group for scrutiny. The Princeton study reveals the problem that is behind CMS’ move away from fee-for-service to a value-based reimbursement system, which would stop rewarding providers for performing unnecessary procedures and instead pay based on whether the patient got better or stayed healthy.

Currie said that it appears procedures aren’t always matched properly to patients. “If you kept the same amount of care and allocated it better, you could have better health outcomes for the same overall cost.”

Reference

Alexander D, Currie J. Are publicly insured children less likely to be admitted to the hospital than privately insured (and does it matter?) [published online January 10, 2017]. Econ Hum Biol. 2017; DOI: http://dx.doi.org/doi:10.1016/j.ehb.2016.10.005.