Graduation Semester and Year




Document Type


Degree Name

Doctor of Philosophy in Industrial Engineering


Industrial and Manufacturing Systems Engineering

First Advisor

Erick C Jones


The Patient Protect and Affordable Care Act of 2010 became a law on March 23, 2010. This healthcare act, according to the authors, is designed to improve health services by targeting various facets of the industry: hospitals, private physicians, insurance companies and the drug industry - to name a few. It impacts many people, both directly and indirectly. The effects of this new law will most likely not immediately be recognized, although is it possible for "pockets: of success stories.The administration of Medicare is an area of interest primarily because of the finances involved. Today, there are many waste streams tied to Medicare and it has become an annual billion dollar problem. Medicare was instituted to take care of the elderly of this nation and a few others with special illnesses; however, the systems that are currently in place to drive this program are performing as they should. About $18 billion dollars is poured in the Medicare system every year to pay for services related to hospital readmissions. This has really become an issue, and hospitals and the federal government alike, are trying to understand what's happening and why it's happening, the end goal of fixing the problems and reducing readmission rates.A part of the healthcare Act is focused on reducing costs related to readmissions. A penalty program was established and implemented beginning October 2012, and each October moving forward, up to three rounds of penalties (2015), hospitals with high hospital readmission rates will receive these penalties. The 2012 -2013 fiscal year had a maximum penalty of 1%, but that amount will increase up to 3% in the 2015-2016 fiscal year. The state of Texas was the second highest state, in terms of number of hospitals receiving penalties - California was top on the list. There were 315 hospitals slated for Medicare review, but some hospitals were fortunate enough to be eliminated from the penalty list.The goal of this study was to determine if a model could be constructed to predict if a Texas hospital would be penalized. The access to actual data is very limited in the healthcare industry, so the data collection plan consisted of obtaining data from reputable sources such as the Center for Medicare and Medicaid Services (CMS).The data collected was analyzed using a binary logistic regression, with following responses (Penalized, Not Penalized). The predictor variables were taken from three key process steps: (1) Input to Hospital, (2) Operations within hospital, and (3) Output (discharge processes). From a count of 42 initial predictors, a model with a discrimination value of AUC = 0.75 and 6 predictors was constructed. The model is statistically sound and has merit, and hospitals, in the state of Texas, can utilize this model, recognizing its limitations, to predict whether or not they will be penalized.


Engineering | Operations Research, Systems Engineering and Industrial Engineering


Degree granted by The University of Texas at Arlington