The Trade-Off between Costs and Outcomes: The Case of Acute Myocardial Infarction

OBJECTIVE: To investigate and to quantify the relationship between hospital costs and health outcomes for patients with acute myocardial infarction (AMI) in Veterans Health Administration (VHA) hospitals using individual-level data for costs and outcomes. DATA SOURCES: VHA administrative files for the fiscal years 2000–2006. STUDY DESIGN: Costs were defined as costs incurred during the index hospitalization for treatment of AMI. Mortality and readmission, assessed 1 year after the index hospitalization, were used as measures of clinical outcome. We examined health outcomes as a function of costs and other patient-level and hospital-level characteristics using a two-stage Cox proportional hazard model that accounted for competing risks within a multilevel framework. To control for patient comorbidities, we compiled a comprehensive list of comorbidities that have been found in other studies to affect mortality and readmissions. PRINCIPAL FINDINGS: We found that costs were negatively associated with mortality and readmissions. Every U.S.$100 less spent is associated with a 0.63 percent increase in the hazard of dying and a 1.24 percent increase in the hazard to be readmitted conditional on not dying. This main finding remained unchanged after a number of sensitivity checks. CONCLUSIONS: Our results suggest that there is a trade-off between costs and outcomes. The negative association between costs and mortality suggests that outcomes should be monitored closely when introducing cost-containment programs. Additional studies are needed to examine the cost–outcome relationship for conditions other than AMI to see whether our results are consistent.