Indicators of Inpatient Care in Colorado Hospitals, 2001

Interpreting tables used on this site.

1. Risk Adjustment
2. Differences Between Hospital Observed Rates and Risk-Adjusted Rates
3. Expected Rates
4. Evaluation of Performance - Statistical Significance Testing
5. Symbols Used to Indicate Significant Differences in Reports

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Risk-Adjustment*

• Risk-adjusted rates are the estimated performance of hospitals if they had an ‘average’ casemix. The average casemix is estimated from the AHRQ national database (data from 28 states).
• Estimates of the average case mix reflect the distribution in age, sex, and APR-DRG categories among the hospitals in the national database.
• Most indicators are risk-adjusted for age, sex and APR-DRG’s.
• Mortality measures use the APR-DRG risk of mortality score and the utilization measures use the APR-DRG severity score.
• The measures Cesarean Section, Vaginal Birth After Cesarean Section (VBAC), and laparoscopic cholecystectomy rates are characterized by a single APR-DRG and are only risk-adjusted by age. Laparoscopic cholecystectomy is also adjusted by sex.
  
  *Risk Adjustment software developed by 3M Corp (http://www.3m.com/us/healthcare/his/products/coding/refined_drg.jhtml).
  

Differences Between Hospital Observed Rates and Risk-Adjusted Rates

Observed Rate > Risk-adjusted Rate

• Mortality indicators: The hospital’s patient population for the condition or procedure has a higher risk of mortality due to its casemix (for example, older or a greater proportion of a higher-risk APR-DRG).
• Utilization indicators: The hospital’s population has a higher risk of receiving the procedure due to its demographic composition (for example, older or a greater proportion of a higher-risk gender).

Observed Rate < Risk-adjusted Rate

• Mortality indicators: The hospital’s patient population for the condition or procedure has a lower risk of mortality due to its casemix (for example, younger or a greater proportion of a lower-risk APR-DRG).
• Utilization indicators: The hospital’s population has a lower risk of receiving the procedure due to its demographic composition (for example, younger or a greater proportion of a lower-risk gender).

Observed Rate = Risk-adjusted Rate

• Mortality indicators: The hospital’s patient casemix for the condition or procedure is similar to other hospitals’, suggesting that patient composition is not a contributing factor to the hospital’s performance for the mortality indicator.
• Utilization indicators: The hospital’s population is similar to other hospitals in demographic composition.

Expected Rates

Expected Rate represents a mathematical computation using the risk-adjusted rates. The formula used by AQHC is:
Hospital Expected Rate = (Hospital Observed Rate / Hospital Risk-Adjusted Rate) times the Comparative (State) Average Risk Adjusted Rate

The expected rate answers the question “What would the mortality rate be for this group of patients (the hospital’s patients) if the hospital had performed to the average standard of other hospitals in the state (expected rate) rather than how they actually performed (the hospital’s observed rate)?” It is the predicted outcome when applying the state average casemix to a specific hospital.

Observed rate < Expected Rate

• Mortality indicators: The hospital’s performance is good, better than average.

Observed rate > Expected Rate

• Mortality indicators: The hospital’s performance is poor, worse than average.

Observed rate = Expected Rate

• Mortality indicators: The hospital’s performance is average, consistent with the state average performance.
  

Evaluation of Performance - Statistical Significance Testing
Statistical Significance of Hospital Risk-Adjusted Rate

The test is whether a specific hospital’s risk-adjusted rate is significantly higher or lower than the state average (or other comparative average) risk-adjusted rate with a 95% confidence interval.

The risk-adjusted rate represents the likely outcome if a group of average patients (national average case mix) were cared for by the hospital. Or in other words, if the hospital’s case mix was adjusted to that of the national average how the hospital would be expected to perform compared to peers (state or other comparative group). This can be used to compare performance across hospitals. The formula uses the AHRQ national mean square of error (these reference data values are provided in the AHRQ software). The formula is: Hospital Risk-Adjusted Rate +/- (1.96) times the (square root of mean square of error/square root of number of cases in hospital denominator population).

Comparative RA Rate > Hospital RA Rate, Upper Confidence Interval Value

• Mortality Indicators: Hospital’s risk-adjusted mortality rate is statistically significantly lower than the comparative group, performance is better.

Comparative RA Rate < Hospital RA Rate, Lower Confidence Interval Value

• Mortality Indicators: Hospital’s risk-adjusted mortality rate is statistically significantly higher than the comparative group, performance is worse.

Comparative RA Rate = Hospital RA Rate, Within Values of Lower and Upper Confidence Intervals

• Mortality Indicators: Hospital’s risk-adjusted mortality rate is not different than the comparative group.
  

Symbols Used to Indicate Significant Differences in Reports

Comparative RA Rate > Hospital RA Rate, Upper Confidence Interval Value

• Mortality Indicators: Hospital’s risk-adjusted is statistically significantly lower than the comparative group, performance is better.
  • Performance is Better, Symbol used is
• Utilization Indicators: Hospital's risk-adjusted is statistically significantly lower than the comparative group. Utilization is lower.
  • Utilization is Lower, Symbol used is

Comparative RA Rate = Hospital RA Rate, Within Values of Lower and Upper Confidence Intervals

• Mortality Indicators: Hospital’s risk-adjusted rate is not different than the comparative group.
  • Performance is Not Different or Average, Symbol used is
• Utilization Indicators: Hospital's risk-adjusted is not different than the comparative group.
  • Utilization is Not Different or Average, Symbol used is

Comparative RA Rate < Hospital RA Rate, Lower Confidence Interval Value

• Mortality Indicators: Hospital’s risk-adjusted rate is statistically significantly higher than the comparative group, performance is worse.
  • Performance is Worse, Symbol used is -
• Utilization Indicators: Hospital's risk-adjusted rate is statistically significantly higher than the comparative group. Utilization is higher.
  • Utilization is Higher, Symbol used is