Is the Obama administration equipped to arbitrate the dispute over geographic disparities in Medicare spending?
Most people probably don’t think of health care reform and the cutbacks anticipated in Medicare as issues that require geographic mapping expertise. I didn’t, until I spoke to policy advisers about the Dartmouth Atlas of Health Care project.
More important, though, is whether the Obama administration really gets the connection.
The Dartmouth project has gained a reputation during the past two decades as the chief authority on geographic disparities in Medicare per-capita spending. In dozens of studies, its researchers have asserted the existence of large regional differences in such expenses. For example, they recently uncovered quadruple to tenfold variations in regional per-capita expenditures on joint replacements.
Dr. David Goodman, co-principal investigator for the Dartmouth atlas, said the researchers correct for differences based on age, income and other variables. “We strive to isolate just the health system factors,” Goodman told me. The project’s most influential research suggests that regions with proportionally more doctors and hospitals tend to have higher per-person expenditures for care.
In other words, it’s a supply-side view. Having an abundance of doctors and equipment in an area appears to push up expenditures. That research has won admiration from the White House, with Office of Management and Budget Director Peter Orszag saying that “supply appears to generate its own demand.”
To achieve savings, it’s a short hop from the Dartmouth atlas data to the idea of reducing Medicare payments to high-cost regions. And with the Obama administration promoting the model, the concept might form part of the anticipated wave of Medicare reductions, which are expected to reach $450 billion.
That possibility worries people like Gary Puckrein, president of the National Minority Quality Forum. The Dartmouth atlas' stance “is an orthodoxy that has not really been challenged,” Puckrein said. He said he suspects that the techniques for adjusting the data do not adequately account for differences among patients, thereby skewing the results.
With respect to the geographic aspect, some critics also question how Dartmouth atlas researchers use mapping data and define the regions. This is how Robert Goldberg, president of the Center for Medicine in the Public Interest, critiqued the Dartmouth atlas: “The regions are drawn to fit the conclusions and are only specific to Medicare hospital expenditures. They do not capture variations in severity of illness or utilization of population.”
Dr. Richard Cooper, a professor of medicine at the University of Pennsylvania, also believes that oversimplification occurs in studies that purport to find regional disparities in health spending. He wrote in a recent blog entry that data discrepancies commonly occur when adjusting for the effects of income in high-income ZIP codes.
Goodman defends the Dartmouth research as being peer-reviewed and using appropriate geographic measures.
I’m no expert in geographic data techniques or regional disparities in health care spending. But I was curious to know who at the Health and Human Services Department might address the arguments about such disparities in Medicare spending and their application to possible cutbacks.
It’s not as though HHS has no geographic expertise: the Centers for Disease Control and Prevention has exemplary maps of public health data; the National Cancer Institute has the huge cancer grid project; and the Health Resources and Services Administration has its online geospatial data warehouse. What HHS does not have is a central geospatial authority or coordinator. Does it need one?
The experts at the Management Association for Private Photogrammetric Surveyors, a geospatial industry group, think so. In a March 26 letter to HHS, the group recommended creation of a central geospatial office to carry out the 814 geography-related provisions of the health reform legislation. Spokesman Nick Palatiello goes further: “Without a central geospatial management office, there is tremendous duplication. Each agency uses geographic data for its own stovepipe.”
It seems appropriate that HHS ought to approach the issue of regional disparities in Medicare with some geographic and analytical expertise. “You would want to be comparing apples to apples,” Palatiello said. "A central geospatial management office at HHS would be the appropriate place to weigh in."
HHS officials declined to respond to several requests for comment.
With nearly $500 billion in Medicare costs at stake and recommendations that the White House take a regional view for trimming the Medicare budget, HHS might well need an objective mapping expert at the table with the other policy wonks.
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