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The Implications of Regional Variations in Medicare Spending: Health Outcomes and Satisfaction with Care
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What is the problem and what is known about it so far?
Medicare is the public health insurance program for Americans over age 65. Medicare spending in different parts of the United States varies widely. For example, in 1996, the average spending for each Medicare patient was $8414 in Miami and $3441 in Minneapolis. Reasons for this variation include differences in prices, the general health of residents, and the tendency of doctors and patients to use health care services in the various parts of the country. If higher health care spending in a region led to healthier and more satisfied patients, we might think that the money was well spent. If higher spending did not result in these benefits, we would worry about waste.
Why did the researchers do this particular study?
The researchers wanted to see whether Medicare patients who live in places that spend more on Medicare have better health outcomes or higher satisfaction with health care than those who live in places that spend less.
Who was studied?
Using national Medicare data, the researchers studied 614,503 patients hospitalized for hip fracture, 195,429 patients hospitalized for colon cancer, and 159,393 patients hospitalized for heart attacks during 1993–1995. In addition, the authors studied 18,190 typical Medicare patients who had completed a survey. Thus, they studied four different groups of patients.
How was the study done?
The researchers divided the United States into 306 regions based on where people go for hospital care. They then calculated how much the Medicare program spent during the last 6 months of life for people who died in each region during July 1994–December 1997. Next, they divided the 306 regions into five groups according to the spending levels. The researchers used end-of-life spending as a measure of general Medicare spending. The researchers then looked at the 5-year death rates for the hip fracture, colon cancer, and heart attack patients. They also looked at patient reports about functional status and satisfaction with care for the patients who completed the survey.
What did the researchers find?
Patients' health status was similar across the five different spending levels, but those who lived in high-spending regions had more frequent doctor visits, tests, and minor procedures and more specialist and hospital care. However, the researchers found no evidence of lower death rates, better functional status, or consistently better satisfaction with care for patients in the high-spending regions.
What were the limitations of the study?
The researchers looked at a limited number of patient groups and a limited number of measures of functional status and satisfaction with care. It is possible that the results would be different for patients with other conditions or in studies that used other measures of functional status and satisfaction.
What are the implications of the study?
For Medicare patients, living in a region with high Medicare spending is not necessarily associated with lower death rates, better functional status, or higher satisfaction with care.
Article and Author Information
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The summary below is from the full report titled “The Implications of Regional Variations in Medicare Spending. Part 2: Health Outcomes and Satisfaction with Care.” It is in the 18 February 2003 issue of Annals of Internal Medicine (volume 138, pages 288-298). The authors are ES Fisher, DE Wennberg, TA Stukel, DJ Gottlieb, FL Lucas, and ÉL Pinder.
- Copyright ©2004 by the American College of Physicians
