The PTOM measures a hospital's ability to generate revenue while controlling for expense.
Due to RAC denials, where expense is incurred from an admission but not revenue, RAC is expected to have a greater negative impact on PTOM than Medicare Advantage.
A mixed-effects model was used to capture the effect over time (11 years) of the repeated measurements for each hospital, containing both fixed and random effects, to estimate the association between PTOM and the independent variables described above.
PTOM did not significantly change over the 11-year period.
Figure 1 illustrates changes in average PTOM at FP and NFP hospitals over the study period.
The FP hospitals start this study period at a much higher and positive PTOM position than the NFPs, as evidenced in the intercept and the effect of NFP ownership status.
PTOM had the same association with payer types regardless of hospital ownership type, with the exception of Other Payers, which is a relatively small group of unidentified payers.
Larger bed size was positively associated with PTOM.
Medicare Advantage was not associated with PTOM at FP or NFP hospitals, using Commercial insurance as the reference group.
In contrast, the RAC variable was associated with a significant decrease in PTOM at FP hospitals, but not at NFP hospitals.