From the emergency department to the general hospital: hospital ownership and market factors in the admission of the seriously mentally ill

Abstract

General hospitals are becoming the safety net provider for the seriously mentally ill (SMI) in the United States, but these patients are faced with a number of potential barriers when accessing these hospitals. Hospital ownership and market forces are two potential organizational and healthcare system barriers that may affect the SMI patient's access, because the psychiatric and medical services they need are unprofitable services. This study examines the relationship among hospital ownership, market forces, and admission of the SMI patient from the emergency department into the general hospital. This was a cross-sectional study of a large sample of SMI patients from the 2002 State Inpatient Datasets for five states. Multiple logistic regression was applied in the multivariable analysis. After controlling for patient, hospital, and county covariates and when compared with not-for-profit hospitals, public hospitals were more likely to admit while investor-owned hospitals were less likely to admit SMI patients. Hospitals in competitive markets were less likely to admit while hospitals with capitation revenues were slightly less likely to admit these patients. Policy options that can address this "market failure" include strengthening the public psychiatric inpatient care system, making private health insurance coverage of the SMI more equitable, revising Medicare prospective payment system to better reimburse the treatment of the SMI, and allowing not-for-profit hospitals to count care of the SMI as a community benefit. Results of this study will be useful to healthcare managers searching for ways to reduce unnecessary administrative costs while continuing to maintain the level of administrative activities required for the provision of safe, effective, and high-quality care.