Skip to main content

A Couple More Health Research Summaries

By May 2, 2022Commentary

A return to those boring times of yesteryear, when three people read my commentary on health research, policy and business.

Geographic variation in health spending in the United States has a long research history, with people puzzling over why it exists and what might address it.  This research in Health Affairs (stacked up in my pile from early in the epidemic) finds that in regard to Medicare spending per beneficiary, the variation between regions actually declined in the decade from 2007 to 2017.  During this period the difference between the top 10% spending regions and the lowest 10% spending regions declined by 14%.  The previous fastest spending growth regions became the slowest ones, and vice versa, suggesting some regression to the mean.  More use of post-acute care providers appeared to help reduce the variation.   (HA Article)

This is yet another piece of research that indicates how much hospital outpatient clinics mark up the cost of infused specialty drugs, for no reason other than making a huge profit.  It comes from the Blue Cross plans and finds that prices paid for those drugs in an outpatient department were twice as high as if the same drug were given in a physicians office.  Across the country this practice leads to billions of dollars in extra spending a year, which could be simply remedied at least in Medicare and Medicaid by refusing to pay a different amount depending on the infustion setting.  The authors worry about the impact on patient cost-sharing, but a properly designed reimbursement method would actually reduce patient spending as well as payer costs.  (HA Article)

And from the government really is stupid department, Medicare is constantly trying to adjust reimbursement rules to prevent provider game-playing to maximize payments, but usually does so in a manner that only opens a new route for providers to try to get paid more.  This study looked at the rule change that required that for inpatient payment, a patient had to be in the hospital for at least two midnights.  Any other stay would be reimbursed at a lower “observation” stay level, and a hospital had to “guess” in advance which one a particular patient would be.  It imposes an administrative cost on a hospital to decide which level a stay is.  There was a pretty quick shift of a small percent of stays from inpatient to observation, but that leveled off.  And it isn’t clear that total spending was any lower, or that the rule substantially changed a trend that was taking place anyway.  And one way or another consumers and taxpayers pick up the added administrative cost of attempting to comply with the new policy.  (HA Article)

Leave a comment