Prices don't drive regional Medicare spending variations


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Publication Topics

Prices don't drive regional Medicare spending variations

Publication TypeJournal Article
Year of Publication2010
AuthorsGottlieb DJ, Zhou W, Song Y, Andrews KG, Skinner JS, Sutherland JM
JournalHealth affairs (Project Hope)Health.Aff.(Millwood)
Pages537 - 543
Date Published2010
KeywordsAdult, Diagnosis-Related Groups/statistics & numerical data, Geography/statistics & numerical data, Health Expenditures/statistics & numerical data/trends, Health Services Accessibility/economics, Hospitals/utilization, Humans, Inpatients, Insurance, Health, Reimbursement, Medicare Part B/economics, Medicare/economics, Outpatients, Referral and Consultation/economics/utilization, Regional Medical Programs/economics, United States, Utilization Review
AbstractPer capita Medicare spending is more than twice as high in New York City and Miami than in places like Salem, Oregon. How much of these differences can be explained by Medicare's paying more to compensate for the higher cost of goods and services in such areas? To answer this question, we analyzed Medicare spending after adjusting for local price differences in 306 Hospital Referral Regions. The price-adjustment analysis resulted in less variation in what Medicare pays regionally, but not much. The findings suggest that utilization-not local price differences-drives Medicare regional payment variations, along with special payments for medical education and care for the poor.
Citation Key357