# The Effect of Hospital-Physician Vertical Integration on Costs, Quality, and Utilization for Insured Patients with Multiple Chronic Conditions

> **NIH AHRQ R36** · NORTHWESTERN UNIVERSITY · 2024 · $44,514

## Abstract

Project Summary
Improving the quality of care for patients with multiple chronic conditions (MCCs) continues to
be a national priority. Concurrently, hospital-physician vertical integration – namely, hospitals
acquiring independent physician practices, directly employing physicians, or having significant
financial ties to physician practices – has become commonplace. Prior research has largely
shown hospital-physician integration to be associated with higher healthcare costs with mixed
effects on quality and utilization outcomes. However, no known study has examined the effect of
hospital-physician vertical integration on outcomes for patients with MCCs, who tend to be
costly, high utilizers of health care. To address this gap and inform future policymaking, we will
examine the association between hospital-physician vertical integration and costs, quality, and
health services utilization for patients with MCCs. To meet the objectives, Aim 1 will evaluate
the association between hospital-physician vertical integration and health services utilization for
an insured panel of patients with MCCs, while Aims 2 and 3 will evaluate the effect of this type
of vertical integration on costs and quality, respectively. We will use data from four sources: 1)
the Virginia All-Payer Claims Database (VA APCD), a longitudinally linked state-level database
consisting of de-identified patient-level medical and pharmacy claims for millions of Virginia
residents with commercial, Medicaid, and/or Medicare coverage 2) the Medicare Data on
Provider Practice and Specialty (MD-PPAS) file, a data repository of specialties, practice
affiliation, demographics, and geography for more than 1 million providers 3) the American
Hospital Association Annual Survey, a nationally representative survey of more than 6,000
hospitals and 400 health systems that will be used to define hospital-level covariates, and 4) the
American Community Survey (ACS), a publicly-available survey database that includes 5-digit
zip code-level data related to neighborhood-level socioeconomic status, such as median
household income, educational attainment, and poverty status. The study aligns with AHRQ’s
mission and strategy by addressing two priority areas: 1) research that advances whole-person,
360-degree care for those with MCCs and/or socioeconomic disadvantage, and 2) harnessing
data to contribute novel information about the accessibility and affordability of health care by
examining how hospital-physician vertical integration (an innovative market approach) is
impacting care delivery and financing.

## Key facts

- **NIH application ID:** 10895028
- **Project number:** 1R36HS029643-01A1
- **Recipient organization:** NORTHWESTERN UNIVERSITY
- **Principal Investigator:** Alexandra Harris
- **Activity code:** R36 (R01, R21, SBIR, etc.)
- **Funding institute:** AHRQ
- **Fiscal year:** 2024
- **Award amount:** $44,514
- **Award type:** 1
- **Project period:** 2024-09-01 → 2025-06-13

## Primary source

NIH RePORTER: https://reporter.nih.gov/project-details/10895028

## Citation

> US National Institutes of Health, RePORTER application 10895028, The Effect of Hospital-Physician Vertical Integration on Costs, Quality, and Utilization for Insured Patients with Multiple Chronic Conditions (1R36HS029643-01A1). Retrieved via AI Analytics 2026-05-26 from https://api.ai-analytics.org/grant/nih/10895028. Licensed CC0.

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