In Medi­care, states are far from equal

Modern Healthcare - - NEWS - By El­iz­a­beth Whit­man

In 2015, Hawaii spent $6,608 per tra­di­tional Medi­care ben­e­fi­ciary, but Mis­sis­sippi spent $10,700. Na­tion­wide, Medi­care per capita costs amounted to $9,582, CMS data re­leased last week show. So, why the dif­fer­ence?

Medi­care spend­ing, uti­liza­tion and qual­ity vary widely across states, a phe­nom­e­non that is long-stand­ing but re­mains poorly un­der­stood. These fluc­tu­a­tions by ge­og­ra­phy do not seem to re­flect ben­e­fi­cia­ries’ health, the CMS noted in its method­ol­ogy doc­u­ment for the data, which are re­leased an­nu­ally in what is for­mally known as the Geo­graphic Pub­lic Use File.

This lat­est up­date in­cludes data for 2007 to 2015 in seven cat­e­gories, in­clud­ing geo­graphic vari­ables, uti­liza­tion, qual­ity and study pop­u­la­tion.

The data re­vealed sig­nif­i­cant vari­a­tion in many ar­eas of how much Medi­care spends, how the ser­vices are used and the level of qual­ity, such as within Medi­care Part B, which pays for drugs. The ac­tual (non-ad­justed, non-stan­dard­ized) costs per user of Part B drugs in 2015 ranged from $381.20 in Ver­mont to $978.75 in Florida. Maine had the low­est pro­por­tion of ben­e­fi­cia­ries us­ing Part B drugs—33.52%— whereas Ten­nessee had the high­est pro­por­tion at 60.78%.

Qual­ity varies sub­stan­tially, too, at least as gauged by hospi­tal read­mis­sions. Utah’s 30-day in­pa­tient read­mis­sion rate of 12.74% ranked it the low­est; Wash­ing­ton, D.C.’s read­mis­sion rate of 21.39% made it the high­est, fol­lowed by Florida at 19.43%.

The CMS re­leased the data to make it eas­ier to an­a­lyze dif­fer­ences in health­care spend­ing and uti­liza­tion. The data are grouped into three types of geo­graphic units: hospi­tal re­fer­ral re­gions, which de­lin­eate re­gional U.S. mar­kets, states and coun­ties. The data in­clude Wash­ing­ton, D.C., Puerto Rico and the Vir­gin Islands.

Medi­care spend­ing, uti­liza­tion and qual­ity vary widely across states, a phe­nom­e­non that is long-stand­ing but re­mains poorly un­der­stood.

In or­der to fa­cil­i­tate the most mean­ing­ful com­par­isons pos­si­ble, the data ex­clude some Medi­care ben­e­fi­cia­ries, in­clud­ing those in Medi­care Ad­van­tage and those en­rolled only in Part A or Part B. The study pop­u­la­tion in­cluded 34.1 mil­lion out of 58.3 mil­lion to­tal Medi­care ben­e­fi­cia­ries.

To mea­sure uti­liza­tion, it looked at met­rics such as the num­ber of stays and days of care in health­care fa­cil­i­ties, home health episodes and vis­its, and num­bers of tests. It also cal­cu­lated all-cause hospi­tal read­mis­sions, emer­gency room use, and ad­mis­sion rates for med­i­cal issues in­clud­ing di­a­betes, hy­per­ten­sion and con­ges­tive

“A siz­able lit­er­a­ture doc­u­ments that dol­lars spent per Medi­care ben­e­fi­ciary vary greatly” among re­gional mar­kets, noted Joseph Ne­w­house and Dr. Alan Gar­ber in an ed­i­to­rial in the New Eng­land Jour­nal of Medicine in 2013.

heart fail­ure, to mea­sure qual­ity. These mea­sures can be used to an­a­lyze the re­la­tion­ship be­tween health­care uti­liza­tion and qual­ity of care in Medi­care, the CMS said.

Ex­perts and pol­i­cy­mak­ers dis­agree over what ac­counts for this vari­a­tion and how to im­ple­ment pay­ment re­form ac­cord­ingly.

“A siz­able lit­er­a­ture doc­u­ments that dol­lars spent per Medi­care ben­e­fi­ciary vary greatly” among re­gional mar­kets, noted Joseph Ne­w­house and Dr. Alan Gar­ber in an ed­i­to­rial in the New Eng­land Jour­nal of Medicine in 2013. “How­ever, the con­sen­sus ends there. There is con­tro­versy about the vari­a­tion’s causes, its ef­fects on qual­ity and out­comes, and what, if any­thing should be done about it.” They noted that a com­mit­tee con­vened by the In­sti­tute of Medicine at­trib­uted most of the vari­a­tion to dif­fer­ences in the use of post-acute care and in­pa­tient ser­vices.

Ex­perts and pol­i­cy­mak­ers have been grap­pling with this is­sue for decades, to lit­tle avail. Data anal­y­sis pub­lished in a 1999 ar­ti­cle in Health Care Fi­nanc­ing Re­view showed vari­a­tions in per capita spend­ing mea­sures that were no­table for their par­al­lels to to­day, two decades later. Hawaii spent $2,289 per Medi­care en­rollee in 1995, the least of all states. Louisiana—as op­posed to Mis­sis­sippi in 2015—was the top spender with nearly twice the per capita ex­pen­di­tures of Hawaii, at $5,481 per fee-for-ser­vice ben­e­fi­ciary, in 1995.

Medi­care Part B drug costs per user (ac­tual, non-ad­justed costs) in 2015

Medi­care costs per per­son, 2015 Risk-ad­justed to ac­count for dif­fer­ences in ben­e­fi­cia­ries’ health and stan­dard­ized to ac­count for geo­graphic dif­fer­ences in pay­ment rates

Hospi­tal 30-day read­mis­sion rates, 2015

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