NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Eric Barrette

Health Care Cost Institute
1100 G Street NW
Suite 600
Washington, DC 20005

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: Health Care Cost Institute

NBER Working Papers and Publications

February 2018Who Pays in Pay for Performance? Evidence from Hospital Pricing
with Michael Darden, Ian McCarthy: w24304
The Hospital Readmission Reduction Program (HRRP) and the Hospital Value Based Purchasing Program (HVBP), two components of the Affordable Care Act's cost containment measures, introduced potentially sizeable penalties to underperforming hospitals across a variety of metrics. To the extent that penalized hospitals subsequently changed their processes of care, such changes may translate into higher payments from commercial insurance patients. In this paper, we estimate the effects of these pay-for-performance programs on private hospital payments using data on commercial insurance payments from a large, multi-payer database. We find that nearly 70% of the costs of the HRRP and HVBP penalties are borne by private insurance patients in the form of higher private insurance payments to hospital...
 
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