Recent Studies Reveal Variation in Price and Quality Among Kentucky’s Hospitals

New Hospital Safety Grade state rankings by the nonprofit The Leapfrog Group shows Kentucky ranks 33rd in overall hospital safety, holding that spot for the second time in a row. This, when paired with the new study released last week by RAND Corp., reiterates that hospitals in the Commonwealth vary in both price and quality.

In the Spring 2019 Hospital Safety Grade rankings, Kentucky’s share of “A” hospitals was just 21%, down from nearly 24% in the Fall 2018 rankings. Leapfrog uses an easy-to-digest A-F grading scale, with “A” being the best. Nearly 70% of Kentucky’s 52 hospitals received a “C” or below rating, compared to the nationwide average of 43%. A new study released by The Leapfrog Group along with the state rankings showed that avoidable deaths due to errors, accidents, injuries, and infections have an 88% greater risk at “C” hospitals and 92% greater risk at “D” and “F” hospitals.

RAND STUDY SHOWS VARIATION IN PRICE, QUALITY IN KENTUCKY’S HOSPITALS

In addition to the Leapfrog safety rankings, Kentucky was one of 25 states that was included in last week’s RAND hospital price transparency report, which for the first time used actual payments by privately insured employers to report inpatient and outpatient prices by hospital. The report shows prices as a percent of what Medicare paid for the same services, thus making these relative prices comparable across the country. The study has been a hot news item in the healthcare world, featured in publications such as The New York Times, The Wall Street Journal, and Forbes.

Kentucky ranks fourth lowest in price of the 25 states in the RAND hospital price transparency study.

Overall, Kentucky came out favorably for its relative pricing to Medicare for private insurance in the report, well under the national average of the states in the study. Of the 25 states included in the data, Kentucky ranked fourth lowest in prices paid to hospitals, at 186% of Medicare compared to the national average of 241%. Similar to what the report illuminates nationally, there is large variation in price – inpatient, outpatient, and overall – among Kentucky’s facilities.

The RAND study looked at the CMS Hospital Compare five-star rating to highlight variation on quality, and that system illuminated similar trends as Leapfrog’s new results. Looking at the CMS ratings, which, like Leapfrog, puts hospitals into five levels of performance, more of Kentucky’s facilities named in the RAND study have poor to average ratings compared to the nation as a whole – 84% compared to the nation’s 51%. This means that just 16% of Kentucky’s hospitals are considered above average or excellent by CMS Hospital Compare.

KHC BRINGS IN RAND STUDY LEADERS FOR COMMUNITY FORUM

These variations in price and quality in Kentucky’s hospitals will be the focus of the Kentuckiana Health Collaborative’s June 4 Community Health Forum, which will bring in the RAND study’s leaders to dive into the results and what this means for Kentucky.

Gloria Sachdev, President and CEO for Employers’ Forum of Indiana, which partnered with RAND on the study, will walk through the study results, focusing on Kentuckiana and Kentucky’s hospital prices and how they compare to the rest of the nation. We will also hear from an employer, Indiana University, that was part of that first-year study in Indiana to discuss how seeing hospital pricing information has impacted their benefit strategy.

Although hospital pricing is important to all stakeholders, this event will be particularly relevant to those interested in employee health benefits, health plan design, and provider payment. RAND is now recruiting more participants for the next iteration of the study, so any employer or health plan that is interested in participating is encouraged to attend and for more information on what is involved.

Register today to join the conversation at the UofL Shelby Campus Founders Union Building. As with most KHC Community Health Forums, attendance is free for KHC members and $35 for non-members, which includes the program, networking, and breakfast. If you are unsure if your organization is a member of the KHC, see the full list here.