Review of Vertical Integration and Adverse Selection in the Health System

Health systems around the world seek to increase the continuity of care between providers at different levels.^1–3 By merging health intendance providers of different levels into a unmarried unit,⁴ vertical integration is a means to reduce fragmentation of care and its negative consequences, especially for older patients or those with multiple chronic weather, whose affliction trajectories typically require contact with several types of providers.⁵ A report conducted in 11 countries showed that the population in a higher place 65 years erstwhile frequently sees >iv different doctors per year, or takes >iv medications; and also that in 10 countries ≥xx% reported receiving uncoordinated care, with values even college for some countries.⁶

Avoidable readmissions are one of the negative consequences of fragmentation of care, due to poor care transitions between providers.^7,8 Vertical integration is therefore expected to reduce readmissions, which is advantageous for patients and providers, as readmissions are frequent,^9,10 betrayal patients to avoidable risks,^eleven disrupt their routine,¹² and are costly.⁹ Readmissions depend on patients' take a chance factors, simply are partially avoidable through changes in care delivery and arrangement.¹³ These changes may include predischarge interventions, postdischarge interventions, or bridging interventions, with meliorate results for more than comprehensive interventions.¹⁴

From 1999 to 2012, 8 vertically integrated units were created past the Portuguese Ministry of Health, which merged hospitals and chief care public providers sharing a common geographical location, aiming to improve efficiency, effectiveness, and population-level outcomes.^fifteen–21 In each example the intervention from the Ministry of Health was to merge existing providers of different levels of care into a new single institution—Local Wellness Unit of measurement (LHU)—and to define the new arrangement design. This intervention occurred in a limited number of providers, whereas others remained unaltered. LHUs are entirely accountable for wellness care delivery, health promotion, and public wellness of the population in the catchment area. In 2014 integrated providers were answerable for eleven.half dozen% of the population in the country.²²

Although there are increasing needs for coordination between providers, our understanding of the human relationship between vertical integration and readmissions is still insufficient to guide time to come developments, as there is mixed evidence about it. An increased level of integration between acute and chief care has been shown to reduce readmissions,^23–25 but other studies bespeak that benefit occurred but only for some patients,²⁶ whereas reviews on this subject report both a positive result and its absence.^27–30 Despite its important findings, prior research focused mainly on interventions aimed at partial components of care provision or specific groups of patients.^{24,25,27–30} A written report focusing on organizational-level integration reports that nonintegrated providers had a college chance of readmission for people aged 65 and over [odds ratio (OR)=1.10; 95% confidence interval (CI), 1.03–1.16].²⁶ Withal, these results were not consistent by condition, every bit the opposite was found for diabetes, and for three weather condition there were no significant differences (chronic obstructive pulmonary disease, hypertension, and congestive heart failure).²⁶ More recent studies about accountable care organizations show that the readmission rate was one.3% higher in answerable care organizations with less primary care orientation.²³

The need remains to compare the same providers in the prevertical and postvertical integration periods. In this study, nosotros expand on the literature by looking at the development of readmissions after the creation of providers integrated at a complete organizational level targeting health of the whole population in a geographic surface area, then comparing that evolution with the evolution of nonintegrated providers, over a x-twelvemonth menstruation.

This study assesses the impact of vertical integration on hospital readmissions in Portugal, with a view to generate testify relevant to monitor existing integrated providers and to decide upon the creation of new ones.

METHODS

Report Design

We compared unplanned 30-day readmissions earlier and after vertical integration in 6 hospitals transitioned to vertically integrated units in a 10-year period (2004–2013). The independent upshot of vertical integration on hospital readmissions was assessed at the admission level with a difference-in-differences technique. Accordingly, the 6 hospitals transitioned to vertically integrated units formed the intervention group, and a control group of 6 institutions having similar characteristics was utilized. The occurrence of a 30-day unplanned readmission was the outcome considered as dependent variable (one: readmitted). We used logistic regression and deemed for the impact of patients' risk factors and systemic-level effects. We assessed changes on readmissions later on vertical integration for each hospital and selected conditions.

Data Sources and Inclusion/Exclusion Criteria

Administrative data on inpatient intendance were provided by the Key Administration of Health System³¹ and included sexual practice, age, master diagnosis, secondary diagnoses, procedures, discharge hospital, admission type, admission and discharge dates, belch status, and a random unique patients' identifier.

Diagnoses and procedures were coded according to the International Nomenclature of Diseases—9th version—Clinical Modification. Nineteen secondary diagnoses were considered. To guarantee anonymity the patients' unique identifier was randomly generated solely for this database by the establishment providing the information.

The study sample included admissions to the hospitals included in the intervention or control group in years 2004–2013 (1,597,159). We excluded 469 admissions for data quality reasons (0.03%); deceased, transferred, or left confronting medical advice (147,946; 9.3%); for which discharge appointment occurred in the last 30 days of each civil yr impeding a 30-day follow-up (112,838; 7.i%); or admitted for psychiatric diagnoses, rehabilitation, or medical handling of cancer (67,375; iv.2%). As vertical integration furnishings need time to occur, the half-dozen-calendar month menstruation subsequently the intervention was excluded (71,697 admissions, 4.v%). There were no missing information on variables included in the study.

Menstruum and Vertical Integration Status

Bachelor data concerned the 2004–2013 period, which allowed usa to include 6 of the viii LHUs existing in 2013. There were no data on the preintervention period for the first feel of vertical integration (1999), and the most recently integrated unit (2012) was also excluded, as only one full year of data following the intervention twelvemonth was available. Vertical integration of the hospitals studied occurred in February 2007 (1 hospital), September 2008 (3), November 2009 (ane), and June 2011 (1).^{sixteen–xix}

Hospitals did not cocky-volunteer to exist integrated and the reduction of readmissions was not the main goal of vertical integration,^15–21 so it was non necessary to account for these factors in the study design.

We considered 2 vertical integration statuses: hospitals transitioned to vertically integrated units (intervention grouping) and hospitals non vertically integrated (command group). The command group included half dozen hospitals that were non vertically integrated to consider systemic-level effects affecting the evolution of readmissions during the menstruation too vertical integration. The control grouping included but hospitals in the aforementioned benchmarking group as intervention group hospitals. These clusters were previously divers by a central health authority (Central Administration of Wellness System) for benchmarking purposes, using hierarchical clustering and primary component analyses.³² Specialty hospitals, public-individual partnerships, and hospitals with a large deviation in volume of admissions were not candidates to be included in the command group. Dimension of hospitals in the control group was slightly smaller, merely at that place was a concentration in the range of 250–400 beds in both groups (iii in both). Nosotros compared the development of readmissions rate in the control group to the development of all hospitals in mainland Portugal. Betwixt 2004 and 2013 the readmission rate grew ane% overall (from three.8% to 4.8%) and 1.ane% in the control grouping (from five.1% to six.ii%) [run into yearly values in Supplementary Digital Content (SDC), Appendix 1, Supplemental Digital Content i, https://links.lww.com/MLR/B347]. All hospitals are not-for-turn a profit public providers.

Dependent Variable

The principal upshot was unplanned 30-twenty-four hours readmissions, acute clinical events requiring urgent hospitalization inside thirty days of discharge, identified every bit defined elsewhere (indicator variable, i: readmitted).³³ Written report was conducted at the admission level, and the dependent variable was occurrence of readmission. We selected index admissions from hospitals considered in the study, only the readmission may have occurred at any public infirmary in mainland Portugal.

Statistical Analysis

Characterization of the population studied included absolute and relative frequency by vertical integration status of sex, historic period group (0–17, 18–64, 65–84, 85+ y), condition (acute cerebrovascular disease; congestive heart failure, nonhypertensive; diabetes mellitus with complications; pneumonia; and urinary tract infections), and comorbidities (congestive centre failure; coronary atherosclerosis or angina, cerebrovascular disease; diabetes mellitus; fe deficiency or other unspecified anemias and blood disease; other infectious diseases and pneumonias; specified arrythmias) in 2004–2013. We selected these weather condition based on their high frequency of admissions and readmissions. Yearly readmission rates for intervention and control group were also computed (number of readmissions/number of admissions).

To assess the relationship between readmission and the change to a vertically integrated unit we used logistic regression (1: readmitted) in a difference-in-differences technique. We first analyzed all admissions in the dataset, then we compared each hospital individually with the control group, and finally we ran a condition-specific analysis. This allowed us to study the impact of vertical integration at an overall level, at each unit of measurement of intervention, and for specific groups of patients.

To develop the x-yr divergence-in-differences model, we computed a continuous time variable consisting of time difference in months betwixt patients' date of admission and date of vertical integration for each hospital in the intervention group. As no vertical integration occurred for the command group, that variable was computed by bold dataset mid-point as the intervention date. On the ground of that, an indicator variable distinguishing patients admitted later vertical integration (intervention group) or after mid-point (control group) was included in the model (1: subsequently). Another indicator variable categorized patients admitted to the intervention grouping (1: intervention group). The interaction term between these ii indicator variables gives an estimate of the contained consequence of the intervention on the outcome studied: an OR significantly <1 indicates a reduction of gamble of readmission after vertical integration. To address potential sources of bias we included 3 covariates: private take a chance of readmission, hospital of treatment, and the continuous time variable (see SDC, Appendix 2, Supplemental Digital Content 2, https://links.lww.com/MLR/B348 for more details). Private adventure of readmission was based on age, disease, and comorbidities,³³ and model bigotry was betwixt 0.threescore and 0.71 (values similar to those found past original authors). This hazard of readmission was computed with a hierarchical logistic regression model from a larger database including all public hospitals in mainland Portugal (7,329,979 admissions), so that estimates were more stable (further details in SDC, Appendix 3, Supplemental Digital Content 3, https://links.lww.com/MLR/B349).

In the provider-specific analysis, we compared each hospital in the intervention group with all hospitals in the command group.

We also tested the consistency of impact of vertical integration beyond a group of selected conditions: astute cerebrovascular disease; congestive middle failure, nonhypertensive; diabetes mellitus with complications; pneumonia; and urinary tract infections.

Finally, to test whether our results were robust to a change in the menstruation studied, nosotros ran a sensitivity analysis for provider-specific assay in which we included just the 24 months before and 24 months later on engagement of vertical integration. This model included the aforementioned variables as the baseline model. Withal, it was not necessary to apply the data set up mid-point, as the date of vertical integration of each provider was considered for intervention and control groups.

Individual risk of readmission was computed with SAS University Edition. All other analyses were run with Stata xiii.0. A level of significance of 95% was considered in the study.

RESULTS

The last sample included i,196,834 admissions during 2004–2013, of which 589,583 (49.3%) were admitted to hospitals transitioned to vertically integrated units (Table one). Remaining admissions were treated in hospitals non vertically integrated (fifty.7%).

TABLE ane:

Patient Characteristics by Vertical Integration Status, 2004–2013

From 2004–2013, patients treated at hospitals transitioned to vertically integrated units were similar to those treated at hospitals not vertically integrated, except for the fact that they were older in the offset grouping (higher up 65 y: 42.viii% vs. 39.3%). All remaining accented differences betwixt percentages were ≤ane% when we considered sex, age, condition, and comorbidities.

The overall readmission charge per unit was v.ane% (four.8% in the intervention group; 5.iv% in the control group). Throughout the 10-year period (2004–2013), yearly readmission rate was lower at hospitals transitioned to a vertically integrated unit (Fig. ane). In 2008, the difference between the intervention and control group increased (2004–2008: range, 0.2%–0.5%; 2009–2013: range, 0.7%–1.one%).

Figure 1:

Yearly readmission rate (%) by vertical integration condition, 2004–2013. Overall readmission rate was 5.ane% (4.viii% in hospitals transitioned to vertically integrated units, 5.4% in hospitals non vertically integrated). The period studied is 2004–2013, and the 6 months after vertical integration were excluded (n=1,196,834 admissions).

The rough readmission rate roughshod after vertical integration from 4.9% to 4.5%, whereas information technology increased in the control group (5.2%–v.vi%) (Tabular array ii). Results from the difference-in-differences technique propose that afterward adjusting for patients' characteristics and systemic-level effects, readmissions decreased afterwards vertical integration (OR=0.900; 95% CI, 0.812–0.997).

Table 2:

Readmission Rate (%) Before and After Vertical Integration, and Adjusted Difference-in-Differences Estimate of the Affect of Vertical Integration on Readmissions, 2004–2013

Because the period 2004–2013, readmission rate decreased in 2 hospitals (H1=3.9%–3.two%; H4=5.6%–5.0%) and increased in ane hospital (H3=5.vi%–6.iii%) (Table 3). In the remaining hospitals absolute variations were <0.three%. We plant that the gamble of readmission decreased subsequently vertical integration in four providers compared with the control group. We observed a significant reduction from 19% (H1=0.811; 95% CI, 0.736–0.894) to 10% (H6=0.891; 95% CI, 0.809–0.981 and H4=0.893; 95% CI, 0.806–0.988). For 1 hospital, there was a more than moderate reduction (H5=0.911; 95% CI, 0.827–i.003). We found no effect for 2 providers (H3=0.960; 95% CI, 0.848–1.087 and H2=0.944; 95% CI, 0.857–i.038). Moreover, we observed that reduction occurred among providers with high and low readmission rates (H4=5.6% earlier vertical integration; H6=5.0%; H1=3.9%; H5=3.8%).

Tabular array 3:

Readmission Charge per unit (%) Before and After Vertical Integration, and Adapted Difference-in-Differences Gauge of the Impact of Vertical Integration on Readmissions for Each Hospital Transitioned to a Vertically Integrated Unit, 2004–2013

We observed a considerable reduction of crude readmission rates for patients with diabetes mellitus with complications later on vertical integration, from 8.8% to 6.2% (Tabular array four). For the remaining selected conditions, absolute variations were <0.three%. The estimate of the impact of vertical integration indicated that at that place was a potent reduction of risk of readmission among patients with diabetes mellitus with complications (0.689; 95% CI, 0.525–0.904) and urinary tract infections (0.762; 95% CI, 0.648–0.897). For patients with pneumonia there was besides a reduction of risk of readmission (0.855; 95% CI, 0.751–0.972). No event was establish for patients with congestive centre failure (1.067; 95% CI, 0.827–1.377) or acute cerebrovascular disease (0.944; 95% CI, 0.734–1.214).

Tabular array 4:

Readmission Rate (%) Before and After Vertical Integration, and Adjusted Difference-in-Differences Approximate of the Impact of Vertical Integration on Readmissions for Selected Conditions, 2004–2013

Results from the sensitivity analysis were like to the baseline analysis. We observed a reduction of readmissions afterwards vertical integration in 4 institutions (H1, H4, H5, and H6) and no result at ii (H2 and H3).

Discussion

A major organisation change occurred in the Portuguese National Health Service when several hospitals and primary care public providers were merged into a single establishment (LHU). In this study, we found that risk of readmission decreased overall following vertical integration. Fifty-fifty if there was no effect for 2 hospitals, affect was positive in 4 hospitals. Bear upon of vertical integration was heterogenous in different groups of patients: there was a articulate reduction of risk of readmission especially of patients with diabetes mellitus with complications and urinary tract infections. However, there was no effect for patients admitted for congestive heart failure or acute cerebrovascular disease. Our overall findings are consistent with the literature reporting a positive touch on of organizational-level integration on readmissions,²³ and as well the existence of differences betwixt weather condition.²⁶

Our study demonstrates that vertical integration had a positive impact on readmissions in 4 of the half dozen institutions. A possible insight into the context and process of implementation³⁴ of vertical integration is provided by the perception of professionals regarding the level of integration achieved. Earlier studies sought to evaluate the perception of integration in hospitals transitioned to vertically integrated units in Portugal. A group of 544 individuals was queried in 2010, and the same questionnaire was used again in 2015 (n=294).^35,36 These groups included physicians from primary and astute care, and managers from top and intermediate levels from institutions studied. Available evidence indicated that the professionals' perceptions of integration had increased with time and some institutions achieved higher levels of integration, which is in line with the differences in scale of the bear on that we observed. The relationship between the perception of integration at each provider and the impact of vertical integration on readmissions needs to be studied further. Besides, detailed cognition from case studies on differences between providers that sheds lite on enablers of and barriers to vertical integration is needed. Notwithstanding, it is of import to annotation that earlier studies have shown that readmissions are a multifactorial event, and in some cases difficult to reduce even with initiatives aimed straight at that purpose.^37,38

Moreover, it should be highlighted that this was a policy-level modify, as the Ministry of Health defined centrally which providers would be merged and fundamental initiatives were express, leaving to each institution the responsibleness to increase integration at the operational level, choosing which initiatives to pursue and their content. Therefore, nosotros can look that process and measures of implementation may have differed among institutions, which is consistent with the different scale of impacts we found by institution.

The development of readmissions was unlike depending on status, which adds to the complication of the mechanisms that link vertical integration and readmissions. Possible explanations include the fact that readmissions for some conditions may exist more susceptible to integration between acute and primary care or there were differences in the collaboration between primary care and hospital professionals that differed between conditions. These findings warrant farther study, but the involvement of professionals in the vertical integration procedure, peculiarly physicians, is a condition for the success of this organizational alter.³⁹ The reduction of readmissions from patients with complicated diabetes is the greatest outcome detected in our written report, equally the risk of readmission decreased well-nigh xxx%. In Portugal, there is a national programme for the control of diabetes that aims to integrate the diverse levels of diabetes management and prevention.^twoscore It is possible that the organizational blueprint of integrated providers created a context favorable to the adoption of actions in the plan, assuasive for better results than those achieved by nonintegrated providers. We observed that approximately 40% of admissions were from patients over 65 years old (approximately 8% above 85), then it was interesting to find besides a positive impact of vertical integration on the readmission of patients admitted with urinary tract infection. Notwithstanding, the absence of an consequence for congestive middle failure patients is reason for business concern, due to the high readmission rates observed.

Our written report has important implications that should be considered in future developments in vertical integration initiatives. These initiatives would gain from a case study of some providers or conditions showing what aspects of the context were more favorable to the intervention, what specific processes and measures of implementation were put in identify and how, and what level of integration was achieved and its relation with the scale of reduction of readmissions. Patients with congestive eye failure are a group to consider, as it is a condition for which no consequence was found and initiatives to reduce readmissions take been described.⁴¹ In Portugal, vertical integration lacked traditional incentives to support its development, such equally the definition of common functioning measures for all levels of care.³⁹ Instead, dissimilar performance measures were adopted at each level, patently unrelated with each other, creating potential incentives for fragmented focus of care. Therefore, the question remains whether improvements could have been realized in a more than coordinated program. Finally, vertical integration was expected to reduce readmissions, but there were many reasons for vertical integration, which aimed to increment efficiency, effectiveness, and population-level outcomes.^fifteen–21 Adding to the fact that the consequences of such a circuitous intervention cannot be reduced to a binary answer (works/does not work), this study's results do not provide an evaluation of the overall success of the vertical integration experience. Such an evaluation would also crave considering other outcomes and the price-effectiveness of the intervention.

The study'southward findings must be borne in low-cal of several limitations. Readmissions are focused on the hospitals' perspective, so the viewpoint of main care was out of the scope of this report. Considering patients' experiences and emergency section use would provide a complementary perspective on the outcomes of vertical integration. Patients' experiences of coordination issues⁶ are relevant, and reasons why patients return after discharge are still not clearly understood or addressed.⁴² Emergency department visits have a considerable bear on on health care use and are disruptive for patients and their families.⁴³ Some other limitation resides in the fact that our results cannot be extrapolated to the two integrated units nosotros were non able to include in the study. The limitations of administrative information we used for risk adjustment are well described elsewhere.⁴⁴ Despite having deemed for the major take a chance factors for readmission and considering that readmissions from the control group followed the land's evolution tendency, the take chances of unmeasured differences remains a weakness of any observational enquiry. Randomized control trials offer promising insights into health services research, just that written report pattern was not feasible in this instance.

In summary, our results signal that merging acute and primary intendance providers into LHUs was associated with reduced risk of readmission, even though improvements were non institute for all institutions or condition-specific groups. These findings suggest that vertical integration tin can take a positive impact, but there are withal challenges to be addressed regarding the success of vertical integration in reducing 30-solar day hospital readmissions.

Acknowledgment

The authors give thanks the deputy editor and reviewers for their helpful comments.

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Keywords:

integrated intendance; delivery of health care; readmissions; quality improvement; international health

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