Watch the video of the creators of the Lown Hospitals Index and an expert panel discussing cost efficiency findings, the methodology, and what’s coming up next.
The Lown Institute Hospitals Index is the first ranking to evaluate cost efficiency for more than 3,000 U.S. hospitals. The Cost Efficiency metric measures how well hospitals achieve great outcomes at a low cost to Medicare.
The Lown Institute analysis found wide variation in cost, even among hospitals of the same type, size, region, and with similar mortality rates. Overall, if all hospitals performed as well as the most cost-efficient hospitals, Medicare would save $8 billion each year. See the top hospitals for cost efficiency and other key findings from our results below. (press release | methodology)
These are the 50 most cost-efficient hospitals in the US on the Lown Index. These hospitals had the best 30-day and 90-day outcomes at the lowest per-patient cost to Medicare.
This table compares Medicare costs for large major teaching hospitals in the same city with similar mortality rates. For each pair of hospitals, we calculate Potential Medicare Savings: how much Medicare would save if the less efficient hospital had the same per-patient costs as its more efficient peer.
30 DAY MORTALITY
30-DAY PER-PATIENT COST
Johns Hopkins Bayview Medical Center
The Johns Hopkins Hospital
Mount Auburn Hospital
Brigham and Women’s Hospital
Advocate Illinois Masonic Medical Center
Rush University Medical Center
JFK Medical Center
St Mary’s Medical Center
Baylor St. Luke’s Medical Center
Memorial Hermann Texas Medical Center
Franciscan Health Indianapolis
Indiana University Health
Huntington Memorial Hospital
Loma Linda University Medical Center
UCSF Medical Center
Mercy Hospital St. Louis
Barnes Jewish Hospital
Howard University Hospital
Medstar Georgetown University Hospital
These are the best-ranked hospitals for cost efficiency in each state.
States sorted by average hospital ranking on cost efficiency.
Cost efficiency grades and rankings for the 20 top hospitals on the US News & World Report ranking.
The cost efficiency metric is a ratio of hospitals’ mortality rates compared to their Medicare costs. Hospitals with the lowest mortality and the lowest costs received the best scores in cost efficiency.
For mortality, we used hospitals’ risk-standardized 30- and 90-day mortality for Medicare patients hospitalized between 2016 and 2018. For cost, we used 30- and 90-day total risk-standardized Medicare payments for patients hospitalized in 2016 to 2018. Payments were standardized for hospital patient risk (the conditions that hospital patients have as well as the procedures they received), so that hospitals with sicker patients were not punished for spending more to treat them. Payments were also adjusted for patient survival, so that hospitals with low patient survival did not have artificially lower costs. Lastly, payments were adjusted for Medicare’s regional cost differences, so that hospitals that get paid more by Medicare because of regional differences did not appear to have higher costs.
For each hospitalization, we found the claim payment amount in all claims within 30 or 90 days from the admission date. These claims included: inpatient, outpatient, carrier, skilled nursing facility, home health agencies, durable medical equipment, and hospice claims. We excluded any claims where Medicare denied the payment. Transfers were excluded.
Medicare adjusts their payment amounts to hospitals and other providers based on various geographic factors. To account for this, we calculated standardized payments using the Virtual Research Data Center’s public use files of 2016 to 2018 Hospital Referral Regions (HRR) standardized ratio tables for patients over 65.
Our goal for the cost efficiency score was to reward hospitals with low mortality rates and low costs, and give the lowest scores to hospitals with high mortality rates and high costs. We also decided to bias our scores to give hospitals with high costs and low mortality a higher score than hospitals with low costs and high mortality. This is because we believe that if there is a trade-off between costs and mortality, we should favor better mortality rates compared to lower costs.
For a more detailed methodology, see our full methods paper.
Media inquiries should be directed to Aaron Toleos, vice president of communications for the Lown Institute, at email@example.com.