An Early-Stage Evaluation of Maryland's Hospital Care Quality Initiative

Abstract

This dissertations focuses upon two pay-for-performance initiatives implemented by Maryland'sHealth Services Cost Review Commission in 2008 and in 2009, respectively. The Commission designed these initiatives to improve the quality of hospital care in Maryland. Maryland retains its uniqueness among American states by maintaining a hospital rate-setting structure. This structure provides the State of Maryland with the ability to more directly impact hospital finances than is the case in other states.Using a logit model with a standard error correction for clustering, this dissertations finds that Maryland'spay-for-performance programs generated immediate and positive results in terms of improving the quality of hospital care in Maryland relative to three control states, Massachusetts, New York, and Florida. While results were mixed across seven quality indicators, the balance of the evidence indicates reduced mortality (especially with respect to pneumonia) and fewer safety lapses. This stands for the proposition that centralized and powerful regulatory structures may be better able to support improved quality than more decentralized frameworks. This finding is of particular salience as the nation continues to wrestle with the possibility of Medicare for all.