The Flex Monitoring Team has released a new policy brief, Impact of CAH Participation in Flex Financial and Operations Improvement Activities on Hospital Financial Indicators.
Under the Medicare Rural Hospital Flexibility (Flex) Program, states with Critical Access Hospitals (CAHs) are eligible to receive federal funds to support hospital improvement. In this brief, the Flex Monitoring Team explores the impact of participation in financial and operational improvement activities on key hospital financial indicators. Key findings include:
- Compared to CAHs with no participation, CAHs with two years of participation and three years of participation showed increases in total margin of 1.60 and 3.95 percentage points, respectively.
- Compared to CAHs with no participation, CAHs with three years of participation showed a 3.16 percentage point increase in operating margin.
- We found no evidence that one year of participation improved profitability indicators, suggesting that continued participation may be necessary to see changes in financial indicators.
- Because interventions were not randomly assigned, we were unable to determine whether there was a causal relationship between participation and financial performance. Results were sensitive to model specification and should be interpreted with caution.
This paper may be accessed via the link below or on the Flex Monitoring Team website.