Environmental Scan to Identify the Major Research Questions and Metrics for Monitoring the Effects of the Affordable Care Act on Safety Net Hospitals. F. Summary of Research Questions and Metrics


Consistent with the above discussion, Table 1 summarizes the main research questions for monitoring the effects of the ACA on safety net hospitals, as well as the “ideal” set of measures that would be needed to answer these questions. For the environmental scan, we do not consider the feasibility of obtaining each of the measures or the potential sources of data for a project that would monitor safety net hospitals—only what is ideally needed to monitor the effects of reform on safety net hospitals. A follow-up report to this environmental scan assesses the feasibility and potential sources of data for obtaining these measures.

To understand the impact of the ACA on safety net hospitals, it will be essential to understand how the ACA has affected the community that the hospital serves, especially in terms of changes in the number of people who are insured, the number of people who remain uninsured, and the characteristics of the remaining uninsured population. Changes in the number of people with insurance coverage in the community will directly affect changes in hospital utilization, uncompensated care, patient revenue, and hospital capacity.

It will also be important to determine how other provisions in the ACA—such as reductions in Medicare and Medicaid DSH subsidies, whether safety net hospitals are included as essential community providers in health plan networks, and benefit structures and cost-sharing levels in the Qualified Health Plans—affect both  utilization and revenue. Even if safety net hospitals see a net increase in revenues, it will be important to assess the costs of certain ACA provisions, such as increased regulation of community benefit, as well as the costs of upgrades to infrastructure, staffing, quality monitoring, and capacity in preparation of reform.

It will also be important to assess key aspects of the local delivery system, especially whether strained primary care capacity has spillover effects on safety net hospitals, such as increased use of hospital emergency departments. The extent and nature of competition between health care providers in the community could have implications for safety net hospitals’ ability to retain existing patients who gain insurance coverage, as well as their ability to attract new patients. It will also be important to assess the extent of payment and delivery system reforms in the community, which will have implications for changes in demand for specific types of services (for example, primary care versus specialty care or outpatient care versus inpatient care), quality of care, and the ability of safety net hospitals to compete for patients.

Finally, it will be important to understand how unique organizational attributes of safety net hospitals, such as their ownership, financial position before reform, and specific preparations made in anticipation of reform, affect their experiences with and responses to reform. Of particular importance are efforts by safety net hospitals to form or participate in integrated delivery systems such as ACOs. As these are viewed as key to improving quality of care and controlling costs, it will be important to assess the barriers to participation and the potential consequences to safety net hospitals of not participating in integrated delivery systems.

Table 1.  Research Questionsand Potential Measures for Assessingand Monitoring the Effect of Health Reform on Safety Net Hospitals.

Topic Research Questions Potential Measures
ACA Coverage Expansions—Effect on
Insurance Coverage in the Community

How will the ACA coverage expansions affect the number and proportion of people in the community with Medicaid, privately insured, and uninsured?

How many uninsured in the community will remain after ACA implementation, and what are their characteristics

How will coverage be affected by the state’s decision to expand or not expand Medicaid?

  • Insurance coverage of population in community prior to reform    
  • Change in percentage of people in community with different types of health
    insurance coverage 
  • Prevalence of immigrant population and other factors that affect eligibility for coverage expansion
ACA Coverage Expansions—Effect on Demand For Care at Safety Net Hospitals

What steps have safety net hospitals taken to improve enrollment
processes and systems to encourage and assist uninsured patients to enroll in coverage?

How will insurance coverage expansions affect utilization of safety
net hospitals?

From existing patients who gain coverage?

From existing patients who remain uninsured?

From new patients with coverage

From new patients who are uninsured?

Mix of inpatient, emergency department, other outpatient services?

How are safety net hospitals affected by “churning” (e.g., when patients switch back and forth from Medicaid to private insurance), and what steps have the hospitals taken to minimize the effects of churning?

  • Hospital enrollment systems and processes
  • Change in volume of visits, by payer source and type of service.
  • # of pre-ACA uninsured patients who continue to get care at safety net hospital after gaining coverage  
  • # of new patients (both insured and uninsured)
  • Rate of switching between private insurance and Medicaid
  • Perceived effects on patient utilization and quality of care
Effect of ACA coverage expansions on patient revenue

How will changes in the demand for care affect patient revenue?

  •  From Medicaid?
  •  From private insurance?
  •  From Medicare, other coverage? 
  •  Uncompensated care?
  •  By type of service—inpatient, emergency department, other outpatient?
  • Changes in patient revenue, by payer source and type of service 
  • Changes in payer mix  
  • Changes in uncompensated care 
ACA provisions that reduce Medicaid and Medicare DSH subsidies

Will the decrease in subsidies from Medicaid and Medicare DSH and other sources be offset by increases in patient revenue from insured patients?

Do safety net hospitals in states that do not expand Medicaid or continue to see high numbers of uninsured patients experience smaller DSH reductions?

  • Changes in revenue from Medicare, Medicaid DSH
ACA provision on including safety net providers as essential community providers in marketplace health plans

Is the safety net hospital included in provider networks of marketplace
health plans?

How does exclusion of safety net hospitals in plan networks affect utilization, revenues, and financial performance?

  • Number of Qualified Health Plans in which hospital is included/ excluded from network 
  • Number of insured people in community in which safety net hospital is part of plan network.
Benefit structure and cost-sharing in Qualified Health Plans sold in the marketplaces How will cost-sharing (copayments, deductibles) in the marketplace
health plans affect revenues from privately insured patients?
  • Percentage of encounters by privately insured patients where full allowed amount was received. 
  • Trends in bad debt by privately insured patients
Other state and local subsidies to safety net hospitals Will safety net hospitals see changesin other subsidies received from states, local governments, or private sources?
  • Changes in revenue from other subsidies
State Medicaid policy

Have there been changes in the state’s level of reimbursement for
Medicaid that affect safety net hospitals?

  • Changes in overall level of reimbursement relative to Medicare, private payers
  • Changes in relative reimbursement for outpatient vs. inpatient services

Have there been changes in Medicaid benefits for services that are important for safety net hospitals?

  • Hospital reimbursement levels relative to Medicare, private payers 
  • Whether reimbursement for outpatient is more relatively generous than for inpatient
  • Changes in coverage of services
  • Changes in Medicaid revenue due to change in benefits
Effects of ACA on hospital costs?

How will the ACA affect hospital costs?

  • Due to upgrading systems for enrolling uninsured people in Medicaid, private coverage.
  • Due to capacity expansions, staffing, and other infrastructure improvements
  • Due to new regulations regarding community benefit and quality measurement.
  • Operating costs
  • Costs for capital expansions, infrastructure, and IT upgrades. 
  • Administrative staffing FTEs
  • Changes in hospital costs attributed to the ACA
Impact of managed care

How will differences in managed care across states affect safety net hospitals?

  • Type, structure of managed care arrangement?
  • Inclusion of safety net hospitals in networks
  • Inclusion of dual eligibles, blind, disabled? 
  • Medicaid managed care penetration in state, community
  • Type of managed care dominant in state (MCOs vs. PCCM)
  • Inclusion of dual eligibles, other aged, blind, and disabled in managed care
  • safety net hospital operates managed care plan
Local delivery system—competition

What is the extent of competition among hospitals for insured patients?

Will increases in the insured population increase competition for patients between health care providers?

Will increased competition affect demand for care (and patient revenue) at safety net hospitals?

Will increased competition for insured patients result in increased concentration of the remaining uninsured at safety net hospitals?

  • Changes in hospital competition
  • Changes in competition between safety net providers
  • Changes in the proportion of total hospital uncompensated care in the community provided at safety net hospitals.
Local delivery system—capacity

Is the capacity of the local delivery system sufficient to handle increased demand for care?

What have been the major capacity expansions in the community,
particularly for primary care? Have these been funded by ACA-related provisions?

How have expansions in primary care in the community affected demand for care at safety net hospitals?

How have shortages of primary care physicians and other providers affect demand for care at safety net hospitals, (e.g., use of hospital
emergency departments)

  • Physician/population ratios (separate for primary care and specialists)
  • Hospital beds/population ratios
  • FQHC expansions, ACA-funded expansions for health homes, nurse-managed health centers.
  • Changes in number of patients being treated by FQHCs
  • Trends in emergency department visits for non-urgent health problems
Local health system— delivery system integration

Are there care delivery and payment reform initiatives in the community sponsored by the federal, state, local govts., or the private sector?

  •  Medicaid PCMH initiatives
  •  CMS Innovation grants
  •  Initiatives by private payers

How does the extent of care integration/ fragmentation in a local health system affect safety net hospitals?

  •  Competition for patients and revenue
  •  Ability to join or form integrated delivery system
  • Medicaid PCMH demonstration in state
  • CMS Innovation grant in state/community that includes or excludes safety net hospital
  • Other state, local initiatives
  • Initiatives by private health plans
  • # hospitals, physicians in community part of integrated delivery system
  • # safety net hospitals, FQHCs, free clinics part of integrated delivery system
Safety net hospital attributes—financial condition How does the financial condition of the hospital pre-ACA affect experiences with health reform?
  • Total and operating margins of safety net hospital pre-ACA, and recent trends in margins prior to ACA implementation
Safety net hospital attributes—capacity

Will safety net hospitals have sufficient capacity to handle increased demand?

  •  How will this differ by inpatient, emergency department, other outpatient, or other service type?
  •  What steps are safety net hospitals taking to increase capacity?
  • Number of inpatient beds, and occupancy rates
  • emergency department beds, waiting times, frequency of ambulance diversions, availability of on-call staff
  • Availability of primary care, and waiting times for primary care
  • Nurse to patient staffing ratios
Safety net hospital attributes—preparations for reform

What other preparations did hospitals make to prepare for reform,
and how do these preparations affect their experiences with reform?

Has the hospital received funding from the HITECH Act or is it part of a Regional Extension Network? What has been the effect of these initiatives on the hospital’s readiness for health reform?

  • IT, other infrastructure
  • Staffing
  • Streamlining of operations
  • Seeking partnerships with other providers in the community 
Safety net hospital attributes—collaborations with other providers

Is the hospital part of a community collaboration of safety net
organizations for the purposes of increasing access to care and/or
care coordination of uninsured patients?

How will the ACA change these collaborative arrangements? (e.g., are they still viable, will they expand to include Medicaid patients, will they evolve into an ACO or other integrated delivery system?)

Have safety net hospitals formed or are participating in any relevant ACOs or other integrated delivery systems?

  • Safety net hospital part of ACO or other integrated delivery system (IDS)
  • Details on composition of
  • providers in ACO, types of patients included, incentives, penalties, quality reporting, etc.
What are the advantages/ disadvantages of ACOs for safety net hospitals and their patients?
  • Financial
  • Competitive position of hospital
  • Quality of care to patients, by payer source
What are the barriers that safety net hospitals face in forming or
participating in ACOs?
  • Mission and governance
  • Financial
  • Risk profile of patients
  • Medicaid reimbursement levels
What are the consequences for safety net hospitals of not participating in ACOs?
  • Competing for insured patients
  • Financial viability
Hospital financial outcomes—viability How will the combined effects of changes in patient revenue, direct subsidies (including Medicare and Medicaid DSH), and hospital costs affect the financial performance of safety net hospitals?
  • Changes in total and operating margins
  • Reasons for changes in margins
Hospital outcomes—safety net mission To what extent will payment and delivery reforms—and the potential for increased competition for patients—affect the “mission” of safety net hospitals to care for uninsured and other vulnerable populations?
  • Amount of uncompensated care relative to other safety net hospitals in community
  • Changes in eligibility criteria that make it harder to qualify for free or reduced-fee care
  • Expansion activities targeting more lucrative services and patients
  • Changes in service lines
Hospitalof care outcomes—quality

What steps are safety net hospitals taking to measure, monitor, and improve quality of care?

How have safety net hospitals performed on CMS quality-of-care
metrics compared to other safety net hospitals in the community?

Are CMS requirements for quality reporting (e.g., 30-day readmission rates) appropriate measures for safety net hospitals?

  • Upgrades to health IT systems
  • Increase staffing, and staff training
  • Implementing patient satisfaction surveys
  • Quality measures as reported in Hospital Compare
  • Views of safety net hospital executives
Is there evidence of improved access to primary care and care
coordination between PCPs and hospitals?
  • # inpatient stays for patients with ambulatory care sensitive conditions
  • Volume of emergency department visits for non-urgent problems
  • Changes in number of emergency department patients with high emergency department use


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