Should Hospitals Keep Their Patients Longer? The Role of Inpatient Care in Reducing Post-Discharge Mortality

The Centers for Medicare & Medicaid Services (CMS) and the National Quality Forum have endorsed 30-day mortality rates as important indicators of hospital quality. Concerns have been raised, however, as to whether post-discharge mortality rates are reasonable measures of hospital quality as they consider the frequency of an event that occurs after a patient is discharged and no longer under the watch and care of the hospital. Using a large dataset comprised of all hospital encounters of every Medicare patient from 2000 to 2011 and an instrumental variables methodology to address the potential endogeneity bias in hospital length-of-stay, we find evidence that 30-day mortality rates are appropriate measures of hospital quality. For patients with diagnoses of Pneumonia or Acute Myocardial Infarction, an additional day in the hospital could decrease 30-day mortality rates by up to 12.8%. Moreover, we find that, from a social planner's perspective, the gains achieved in reducing mortality rates far exceed the cost of keeping these patients in the hospital for an additional day.