Impact of CAH Conversion on Hospital Costs and Mix of Services
Results indicate that CAH conversion resulted in significantly higher total margins for at least the first two years following conversion. The rate of growth in outpatient revenue was higher in CAHs relative to controls, while their inpatient revenue grew at a slower pace. Increases in revenue, combined with decreases in the number of beds, led to a dramatic increase in revenue per bed in the year of conversion, which persisted into the second year after conversion at a lower rate. Medicare inpatient volume, days of care, and average LOS fell significantly following CAH conversion and remained at the new lower levels. Composition of the inpatient care did not appear to change dramatically for CAHs, however, although there appears to have been some increased concentration on a smaller number of diagnosis-related groups (DRGs) and increased focus on providing basic services.
Impact of CAH Conversion on Hospital Finances and Mix of Inpatient Services (Final Report)
NORC Walsh Center for Rural Health Analysis
This study examined Medicare Cost Report and claims data for hospitals before and after critical access hospital (CAH) conversion in order to better understand changes in hospital costs associated with CAH conversion, factors associated with any cost growth, and changes in the mix of services provided by the facility.