Effect of present-on-admission (POA) reporting accuracy on hospital performance assessments using risk-adjusted mortality

Over the past decade, there has been a dramatic growth in the use of risk-adjusted hospital performance assessments to increase the transparency of hospital quality. Performance assessments of hospital mortality rates compare the “observed” death rate at the hospital for a given diagnosis such as AMI to what the “expected” death rate would be, accounting for the health status of patients with the diagnosis at that hospital. In theory, hospitals that provide higher quality care should have lower than expected death rates, and hospitals that provide lower quality care should have higher than expected death rates. The results of comparative evaluations are being tied to financial incentives as part of the Affordable Care Act. Stakeholders, such as the Centers for Medicare & Medicaid Services (CMS), are particularly interested in patient outcomes such as hospital mortality rates. These rates require risk-adjustment to account for differences in the health status of the patient population at different hospitals so that a more accurate estimate of hospital quality can be made. Theoretically, these “risk-adjusted” rates should account for medical conditions that reflect the health status of patients when they arrive at the hospital, and not for diagnoses that result from the hospitalization that could ensue from poor quality care (Hughes et al. 2006). Hospital outcome assessments often rely on administrative data that are generated for all hospitals, but traditionally there was no mechanism in administrative data to distinguish between patients' comorbidities and complications of hospital care. One strategy that has been suggested to improve the clinical utility of administrative data for risk-adjustment is to use present-on-admission (POA) indicators to distinguish between comorbidities and complications of care (Coffey, Milenkovic, and Andrews 2006; Glance et al. 2008a,b; Pronovost, Goeschel, and Wachter 2008; Wachter, Foster, and Dudley 2008). These POA indicator variables flag each diagnosis as to whether a given condition was present at the time of admission and thus, by default, not attributable to a complication of hospital care. Since 2008, the CMS has required hospitals to report POA indicator variables for every diagnosis on an inpatient acute care hospital claim (Centers for Medicare and Medicaid Services 2008). However, whether POA indicators would actually improve the clinical validity of hospital performance assessment depends on how accurate they are. Prior work has demonstrated that POA accuracy varies significantly by clinical condition and by the type of hospital where the patient is admitted (Goldman et al. 2011b). Of particular concern for performance reports is overreporting (as being POA) risk factors that are strongly predictive of death. Overreporting would inflate the expected risk of death among all of the eligible patients at a hospital and thereby mistakenly lower a hospital's risk-adjusted mortality rate. This is particularly true if hospitals tend to overreport important risk factors such as shock as being present on admission, when in fact the condition developed during the hospitalization. Conversely, hospitals that “underreport” risk factors associated with death risk may appear worse than they truly are. The degree of impact of POA misreporting on hospital mortality ranking remains unknown and unexplored. We evaluated the effect of inaccurate reporting of POA on a hospital's performance “rank” using California Patient Discharge Data (PDD). We chose to use California administrative data as California is one of two states that has been reporting POA for over 15 years, and it is the only state for which a large-scale evaluation of POA reporting accuracy compared to a gold standard chart review exists (Goldman et al. 2011a). Our study aimed to address the following questions: (1) does the addition of POA reporting to a risk-adjustment mortality model alter the assessments of hospital performance for AMI care and (2) to what extent are differences in the assessments of hospital performance for AMI care that incorporate POA reporting attributable to inaccuracy in the recording of this variable?