With the advent of bundled payment programs and accountable care organizations, hospitals are forming tighter bonds with skilled nursing facilities across the country. But are these “preferred providers” of hospitals actually providing higher quality care than their “non-preferred” peers?

That was the question that researchers with the University of Minnesota, and two other California schools, set out to answer in a new study. Scouring over Medicare provider and claims data, they found that hospitals are choosing to work more closely with SNFs with lower use of resources, shorter lengths of stay, and that perform better on quality measures.

“To the extent that these networks are becoming more prevalent, these could be potential factors for being selected as a preferred SNF,” lead author Peter Huckfeldt, Ph.D., assistant professor at the University of Minnesota in the Division of Health Policy and Management said in an email.

Researchers studied six hospital systems that have formed preferred provider networks with SNFs between 2013 and 2016 as part of Medicare ACOs. They found that preferred SNFs were all in urban areas, were more likely to be nonprofit, housed more Medicare-certified beds, and delivered care to a lower proportion of Medicaid enrollees, compared to non-preferred SNFs.

They also noted that preferred facilities were more likely to receive five stars on each of the composite quality measures from Nursing Home Compare. Plus, they were more likely to provide seasonal flu vaccines, and less likely to initiate antipsychotic medications. Preferred SNFs across the sample size also exhibited shorter lengths of stay, lower Medicare spending per post-discharge episode ($20,900 for preferred SNFs, versus $22,900 for non-preferred facilities), and lower readmission rates, just to name a few.

More study is needed, Huckfeldt said: “We need to understand the effects of the formation of preferred SNF networks. Do these networks lead to improvements in patient outcomes and lower costs?”