Dramatic regional differences exist in the way in which severely chronically ill patients, who consume 75% of Medicare's budget, are treated in their last 2 years of life, according to a report based on data from nearly 5 million Medicare enrollees.
The authors compared Medicare's regional spending and concluded that the program will “reimburse about $50,000 more for health care services during the lifetime of a 65-year-old in Miami” than it will reimburse for a person of the same age in Minneapolis.
The report, “Care of Patients with Severe Chronic Illness,” is the latest from the Dartmouth Atlas of Health Care, which has measured variations in health care resource utilization by geographic area, cost, and quality since 1993. In particular, the current report is based on the records of 4.7 million Medicare enrollees who died between 2000 and 2003, and who had at least 1 of 12 chronic illnesses. It includes data from more than 4,300 hospitals in 306 regions.
Patients living in high-spending cities such as Manhattan, Los Angeles, and Miami have more doctor visits, hospitalizations, ICU stays, diagnostic tests, and procedures than do such patients in efficient areas such as Salt Lake City and Rochester, Minn. Medicare could save $34.3 billion on hospitalizations and $5.8 billion on physician visits annually (30% and 34%, respectively), if all providers followed the organized care models practiced in lower-spending regions, according to the report.
“High-spending states have many more physicians and acute care hospital beds on a per capita basis than do low-spending states, and the current payment system ensures that they stay busy,” said Dr. Elliott Fisher, professor of medicine and community and family medicine at Dartmouth Medical School, Hanover, N.H. The differences in cost and utilization between efficient and resource-rich areas for severe chronic illness are most dramatic in the last 6 months of life: 6.5 hospital days in Colorado, compared with 19.4 days in New York City; a 74% variation in Medicare spending of $21,599 for lowest utilization areas, compared with $37,622 for highest.
And, according to the report, higher utilization does not buy longer life or better quality of life. Those with chronic illnesses in high-rate regions have slightly shorter life expectancies and less satisfaction with their care than those in lower-spending regions.
Dr. David Wennberg, chief science and products officer of Boston-based Health Dialog, noted that “Medicare fee for service pays doctors and hospitals to do tests and procedures.” He argued that waste and overuse stem from supply and demand. “Where there is greater capacity, more care is delivered—whether or not it is warranted.”
The report indicated that the overuse of acute care hospitals and medical specialists in managing chronic illness is worsening.
A troubling note for physicians caring for the frail elderly is the report's statement that “the country has a current surplus of physicians and is likely to have enough physicians to meet U.S. needs through 2020. Because of the evidence that more intensive care may worsen outcomes, we believe that policy makers should respond to the current calls for increasing the supply of physicians by 15% to 30% with caution.”
The report's focus on an ever-increasing level of care intensity for the severely chronically ill could be reversed if Medicare changes its payment incentives. Or, as Dr Wennberg puts it: If Medicare's current model “moves beyond fee for service and hears the clarion call for change, billions of dollars a year can be saved and quality improved.”
'Where there is greater capacity, more care is delivered—whether or not it is warranted.' DR. WENNBERG