Hospital quality-review spending and patient safety: a longitudinal analysis using instrumental variables

AbstractSince the landmark Institute of Medicine ’s (IOM’s) 2000 report first focused attention to the problem of the safety of inpatient care, it has been a priority of hospital staffs, administrators, and policymakers. Despite remarkable progress in the 20 years since the IOM report, there is still much unknown about how these improvements i n safety have been achieved. Using a 12-year (2004–2015) panel of Florida acute-care general hospitals, we estimate the relationship between hospital expenditure on peer (or quality) review and patient-safety outcomes, using a composite measure of patient safety (PSI-90) from the Agency for Health care Research and Quality. Our identification strategy to account for endogenous quality-review (QR) expenditure relies on exogeneity fromwithin the hospital, in which we use staffing of non-acute ancillary services as instruments for QR expenditure. Estimation of hospital fixed effects (FE) with instrumental variables (FEIV) yields a statistically significant and beneficial effect of QR expenditure on patient safety. We find that, on average, a standard-deviation ($2.4 million) increase in QR expenditure is associated with a 16% decrease in adverse patient-safety events (i.e. PSI-90). Broadly, this study represents a unique contribution to the literature by examining a direct relationship between hospital peer-review spending and inpatient quality of care.
Source: Health Services and Outcomes Research Methodology - Category: Statistics Source Type: research