Hospital performance trends reveal inequities in the system

The Lown Institute recently released their ranking of America’s most socially responsible hospitals for 2022. Hospitals at the top of the ranking prove that it’s possible to provide excellent patient outcomes, prioritize equity, and avoid overuse all at the same time. But just because it’s possible does not mean it’s easy.

Only 66 hospitals out of more than 3600 ranked received all “A” grades on equity, value, and outcomes — just 2% of the total. Why do so few hospitals get top grades across the board? The answer has to do with systemic inequities within our healthcare system and how they drive hospital behavior.

Outcomes vs Equity

Since we started the Lown Hospitals Index in 2020, we’ve noted an inverse relationship between outcomes and equity — hospitals with the best grades on outcomes tend to do worse on equity, and vice versa.

This year is no different. Only 114 hospitals (3% of all hospitals ranked) received A grades on both equity and outcomes. Hospitals with “A”s on equity tend to have worse performance on outcomes metrics than hospitals with “C”s or “D”s (see table below). This pattern is especially acute comparing average rank on clinical outcomes, which includes mortality and readmissions. Hospitals with better outcomes grades have worse performance on equity metrics on average, particularly when it comes to pay equity (how much hospitals pay their CEO compared to other workers) and patient inclusivity.

Table: Comparison of average rankings on the Lown Hospitals Index for hospitals by Outcomes and Equity

Number of hospitalsEquity rank (average)Pay equity rankCommunity benefit rankInclusivity rank
Hospitals with “A”s in Outcomes10382219233319761916
Hospitals with “C”s or “D”s in Outcomes9131752148118551529
Number of hospitalsOutcomes rank (average)Clinical outcomes rankPatient safety rankPatient satisfaction rank
Hospitals with “A”s in Equity7542112215411941986
Hospitals with “C”s or “D”s in Equity16231645158810761674

The same pattern occurs when looking at the top hospitals for outcomes and equity. Among the top 10 hospitals for outcomes on the Index, none received an “A” in equity. And among the top 10 for equity, none received an “A” in outcomes (see tables below).

Outcomes rankHospitalStateCityEquity grade
1Mayo ClinicFLJacksonvilleD
2Mayo Clinic Hospital RochesterMNRochesterC
3Avera Sacred Heart HospitalSDYanktonC
4Virginia Mason Medical CenterWASeattleC
5Mayo Clinic Health System Eau ClaireWIEau ClaireC
6Ascension St. Vincent CarmelINCarmelC
7Pali Momi Medical CenterHIAieaC
8University of Utah Hospitals and ClinicsUTSalt Lake CityC
9Legacy Salmon Creek Medical CenterWAVancouverB
10Presbyterian St. Luke’s Medical CenterCODenverB
Equity rankHospitalStateCityOutcomes grade
1Metropolitan Hospital CenterNYNew YorkB
2Woodhull Medical and Mental Health CenterNYBrooklynB
3University HospitalNJNewarkC
4Harlem Hospital CenterNYNew YorkB
5St. Charles MadrasORMadrasB
6Brownfield Regional Medical CenterTXBrownfieldC
7Temple University HospitalPAPhiladelphiaB
8Prosser Memorial HospitalWAProsserB
9Mercy Hospital Logan CountyOKGuthrieB
10Medina Regional HospitalTXHondoC

Separate and unequal

The inverse relationship between outcomes and equity on the Lown Hospitals Index reflects our 2-tiered healthcare system: Those with private insurance have greater access to prestigious, well-resourced hospitals, while those with public insurance or no insurance often go to safety net hospitals that struggle to reach the same quality standards.

The divide stems from the backwards way in which we pay hospitals. Hospitals get paid the most to perform high-tech elective surgeries for patients with private insurance, but barely break even on preventive or routine care for patients with Medicare or Medicaid. This means hospitals have to attract a certain number of privately-insured patients to succeed financially, which leads to them to things like expand their practices to the suburbs despite greater need in the city; invest in unproven but attractive technologies like proton beam machines; and turn their campuses into glittering cities to draw patients from around the world.

“My husband calls [the Cleveland Clinic] the Emerald City because at night it lights up down there with the glass and the structures of the buildings. As you can see, they’re building all around us … they’re making their own world.”

Nora Brown, Cleveland resident, WKSU

At the same time, safety net hospitals that currently care for a disproportionate number of uninsured and publicly insured patients get paid less to care for these patients and as a result run on much lower margins compared to other hospitals.

Our separate and unequal hospital system creates disparities in access and quality of care. For example, Black and Indigenous individuals are deeply underrepresented in clinical trials of new cancer drugs, in part because they have less access to the hospitals that run these studies. Lower-quality care at some safety net hospitals also contributes to higher rates of COVID-19 mortality and life-threatening birth complications

How the system must change

For more hospitals to succeed on both outcomes and equity, we need a healthcare system that rewards hospitals for taking care of everyone in their community and financially supports the hospitals that are already doing so.

Our 2-tiered reimbursement system is a legacy of racism. People of color make up about 60% of those covered by Medicaid*, but only 35% of those with employer-sponsored private insurance. If we want everyone to have equal access to hospital care, there should be no difference in the reimbursement rates for those with public versus commercial insurance. If that sounds radical, consider that Maryland has had an “All-payer” rate system since the 1970s, in which hospitals are paid similar rates for each patient regardless of insurance status.

We have to not only make high-quality hospitals more accessible, but improve the quality of hospitals taking care of the most medically complex patients. Unfortunately, many of the “pay-for-performance” models that have been implemented are further penalizing safety net hospitals financially, which may make it even harder for them to catch up. Policymakers should target America’s most equitable hospitals for investment and assistance, so that the patients they serve can get the best care possible.

We need many other hospitals to join those at the top who are providing excellent patient outcomes for all in their community. While holding hospitals accountable for their performance on equity is essential, we also need substantive policy changes around payment models and hospital incentives to transform the system.

*This blog was edited to correct an error. People of color make up about 60% of Medicaid patients, not 85%.