Just What 'The Doctor' Ordered
Harvard Professor Regina Herzlinger - not an MD but a PHD - has often spoken/written about how consumers will figure out the best buys in health care; just give them information! I don't think Dr. Herzlinger could have ordered up a better course of information treatment than what is in the July Issue of Consumer Reports.
In an important article entitled "Too much treatment", we get a look at the 2008 Dartmouth Atlas of Health Care decades long study of millions of Medicare beneficiaries. Not surprisingly, "the local supply of doctors and hospitals has more influence on the amount and type of care that patients receive than their actual medical conditions." The kicker is, the more costly aggressive care does not yield better results!
This news on top of the United States Department of Health and Human Services Hospital Compare tool that has just recently received headlines, suggests that Dr. Herzlinger's 'prescription' for transparency of health care cost and quality is well on its way toward being filled.
And to further connect the dots; reporting of this kind will foster competition which lowers costs thus making health care more affordable for the under or uninsured.
Labels: Shopping for Health Care
posted by Jon Rauser @ 10:14 AM
1 Comments
As President & Owner of a successful health insurance brokerage in downtown Milwaukee - 
1 Comments:
After reading your commentary I read the entire Consumer Reports article. What I found most interesting was the map of Medicare spending per patient by state. I was surprised that Wisconsin was on the low end, and even more surprised that New York and California were so high.
I don't know if the prices were regionally adjusted. (Just in case anyone didn't know, there are different Medicare reimbursement rates for almost every state, and at least 3 different rates in New York state alone). Overall healthcare costs are higher here than in either New York (not Manhattan) or California. So it seems odd that Medicare spenidng is so out of line on a per patient basis in those states.
That caused me to think a little. The article suggested that specialists and the prevelance of "agressive" care drove increased costs. Certainly Wisconsin has no shortage of specialists or aggressive care; could that be the answer?
Then something dawned on me. Medicare rates are higher in New York for many procedures, and there are procedures that are available to Medicare patients in New York that are not approved here, but could that be enough to add up to the cost disparity the article mentioned, or was there something more? The article failed to mention payer practices.
New York and California are both states that have a greater prevallance of managed care payers. In that enviornment Medicare becomes a generous payer. Here in Wisconsin, comercial insurance pays at least Medicare rates usually 125% to 200% of Medicare rates, but in a managed care enviornment Medicare often pays as well or better than many commercial payers.
Here in Wisconsin, healthcare systems target populations with commercial insurance to offset shortfalls from government payers. Maybe systems in New York are targeting Medicare patients to cover shortfalls from managed care?
If the best paying patients are seniors then I can definitely imagine a situation where agressive geriatric care would become important to the finacials of a hospital.
In the end, I guess the article was right! If there are a lot of gerentologists, neurologists and orthopedists being recruited by hospitals to encorage utilization by Medicare covered seniors then, specialists agressively treating conditions probably is the reason for higher per patient costs. The fact that it pays the bills might be a factor too.
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