Correspondence

Correction of Endnote in ProPAC Report

N Engl J Med 1997; 337:1778-1779December 11, 1997

Article

To the Editor:

The purpose of this letter is to clarify a misunderstanding in our editorial on hospitals' high administrative costs (March 13 issue).1 We quoted the 1996 report of the Prospective Payment Assessment Commission (ProPAC), which stated that the improved performance of for-profit hospitals “resulted primarily from proprietary hospitals having lower per-case costs after several years of slower cost growth.” 2 However, there was an endnote to this statement explaining that the conclusion was based on an unpublished study by ProPAC in which hospital costs per case were adjusted according to the teaching status of the hospitals. In fact, we have discovered that the endnote was erroneous.

On further research, we learned that the unpublished study found that unadjusted hospital costs per case at for-profit hospitals were lower than those at not-for-profit hospitals. When the data were adjusted for teaching status, the study found the reverse — that costs per case at for-profit hospitals were higher than those at not-for-profit hospitals. However, when the senior staff at ProPAC reviewed these findings, they concluded that the methods used to adjust for teaching status failed to take into account other possible confounding factors (such as location); hence, they rejected publication of the findings. Regardless of the above, it is true, as we stated, that the rate of increase in Medicare operating costs per case has been lowest at for-profit hospitals, as compared with hospitals with other types of ownership, in every year since 1991.

We regret any confusion caused by the erroneous endnote.

Stuart H. Altman, M.D.
David Shactman, M.P.A., M.B.A.
Brandeis University, Waltham, MA 02254-9110

2 References

1. 1

   Altman SH, Shactman D. Should we worry about hospitals' high administrative costs? N Engl J Med 1997;336:798-799
   Full Text | Web of Science | Medline

2. 2

   Medicare and the American healthcare system: a report to the Congress. Washington, D.C.: Prospective Payment Assessment Commission, June 1996.