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Spending Variation Among Physicians in the Same Hospital

By March 22, 2017Commentary

A lot of research has been done in the area of geographic variation in health spending.  It has become apparent, however, that a lot of variation exists at the level of the individual physician and a recent study reported in JAMA Internal Medicine focused on this type of variation.   (JAMA Int. Med. Article)   The researchers used fee-for-service Medicare data regarding non-elective hospitalizations during the period 2011-2014.  They looked at spending variation for the same kind of cases between both hospitalists and all general internist physicians.  In addition, they compared spending with quality outcomes to ascertain if more spending was associated with better performance.  The measures used were thirty days after admission mortality rates and thirty day hospital readmission rates.  A very large pool of data was available and adjustments were made to account for potential confounding factors.  Looking at total part B spending related to the hospitalization, variation in spending was greater between doctors in the same hospital than it was between hospitals.  For hospitalist physicians, the variation in spending was 8.4%, compared to 7% variation in spending for such doctors across hospitals.  For all general internists admitting patients, the variation was 10.5%, compared to 6.2% variation among such doctors across hospitals.

The results indicate that understanding why physicians in the same area, even in the same facility, adopt different practice patterns can be as valuable as understanding why there may be geographic differences in practice patterns that lead to variation in spending.  And in terms of interventions, ultimately they must occur at the individual physician level, and will be most effective if the reasons why a doctor practices in the manner they do is fully understand, and an alternative can be rationally explained to the physician.  Attacking the appropriateness of care in this manner is likely both more cost-effective and more acceptable to the medical community that the alternatives of extensive and intrusive care management programs operated by payers.

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