Understanding the effects of Medicare's home health Quality of Patient Care Star Ratings: patient choice and unintended consequences
Since 2015, the Centers for Medicare & Medicaid Services has released quality of care Star Ratings for home health agencies to better inform patients of home health care quality. The Star Ratings program is designed to be an improvement upon previous report cards to be more transparent, simpler, and easier to understand. Transparent information enables the patient to identify choices that are of highest value to them, which spurs quality competition among health care suppliers and leads to decreased quality variation in the market. Quality variation in the Medicare home health market has consistently been an area of concern. Lower quality home health agencies have poorer rates of compliance with evidenced-based clinical guidelines, poorer functional outcomes, and higher rates of complications among its patients. Because home health patients are clinically and socially vulnerable, finding ways to benefit this disadvantaged group is of high policy relevance. The objective of this project is to determine the effects of the Star Ratings program on Medicare home health admissions. I will identify separate admission effects for each Star Rating level using a regression discontinuity design, exploiting plausibly random variation around Star Rating thresholds. The study encompasses three aims. First, I will estimate the causal effect of an additional Star Rating level on overall changes in new admissions. While providing accessible quality information theoretically could improve market outcomes, no studies have empirically examined the impact of home health Star Ratings information on Medicare patient choice. Second, I will explore whether Star Ratings information provide greater value to patients in markets with "red flag" home health agencies. Prior studies have not commented on the differences in utility of Star Ratings information across important markets attributes, such as markets with low-performing agencies and at risk for fraud. Understanding whether patients use Star Ratings differently across markets will be informative for determining how to increase uptake of Star Ratings information. Third, I will examine the extent to which the Star Ratings program leads to adverse effects for patients and society. Specifically, I consider the degree to which supply constraints incentivizes home health agencies to use strategic behaviors under the Star Ratings program, by preferentially admitting fewer socially and clinically vulnerable patients and by increasing patient retention. Evaluating whether the Star Ratings program worsens access to care for vulnerable patients and increases health care spending provides a deeper understanding of the heterogeneous effects of the program. As policy makers grapple with finding solutions to address market failures such as imperfect information, the need to understand the comprehensive effects of interventions like the Star Ratings program on patients and society becomes more urgent. The outcome of this proposed dissertation will provide several insights useful for policy refinements.
Agency for Health Care Research and Quality, HHS
Funding Period: 9/1/2019 to 8/31/2020