Reducing Regional Disparities in Health Spending: Framing the Debate

David Wennberg and FriendsMaine Medical Center

Center for the Evaluative Clinical Sciences

Regional disparities in health care spending

Part 1 -- Unwarranted variations in U.S. health care: findings from the ‘Is More Better?’ studies

Part 2 -- What can be done about it?

Elliott Fisher, MD, MPElliott Fisher, MD, MPHH Therese Therese Stukel, PhD Stukel, PhD

Dan Dan Gottlieb, MSGottlieb, MSF. L. F. L. Lucas, PhLucas, PhDD Etoile Etoile Pinder, MSPinder, MS

Unwarranted variations in medical practice: a framework for thinking about the delivery (or non-delivery)

of care…

Unwarranted? Variations that cannot be explained by:Illness or need --- and dictates of evidence based medicine

Patient Preferences

Categories of variationEffective care

Preference sensitive care

Supply-sensitive services

Causes and remedies differ for each category

Dartmouth Atlas of Health CareUnited States Hospital Referral Regions

Step 2: Group by regional spending level -- assigned based upon End-of-Life Expenditure Index

Step 1: Select Cohorts

Step 3: Validation(1) are patients the same at baseline?(2) does subsequent treatment differ?

Step 4: Assess outcomesFollow cohorts for up to five years.

Myocardial Infarction Colorectal Cancer

Hip FractureMedicare Population (MCBS)

Elderly (U.S. Medicare) Study Design

Q1 HRRs

Q2 HRRs

Q3 HRRs

Q4 HRRs

Q5HRRs

Low Spending High

Process / Quality of Care / Survival

$ 3,922$ 4,439$ 4,940$ 5,444$ 6,304

Spending

Regional Variations in the End-of-Life Expenditure Index (EOL-EI)

and average per-capita Medicare spending

$ 9,074$ 10,636$11,559$ 12,598$ 14,644

EOL-EI

EOL-EI highly correlated (r = 0.81) with average per-capita Medicare spending

Effective Care

Services of proven effectiveness….

It involves no significant tradeoffs--all with specific needs should receive them

Conflict between patients and providers is minimal

Effective Care: Ratio of Rates in Highest vs Lowest Spending Regions

1.00 1.5 2.00.5 25 3.0

1.00 1.5 2.00.5 25 3.0

Reperfusion in 12 hours for AMI

Beta Blockers at admissionAspirin at admission

Beta Blockers at dischargeAspirin at Discharge

Acute MI

Mammogram, Women 65-69

Flu shot during past yearPap Smear, Women 65+

Pneumococcal Immunization (ever)

General Population

Lower in High Spending Regions Higher in High Spending Regions

Exercise Test w/in 30 d

Preference-Sensitive Care

Involves tradeoffs among outcomes

Decision should reflect preferences of patient

Scientific uncertainty often substantial

Preference-Sensitive Care: Highest vs Lowest Spending Regions

1.00 1.5 2.00.5 25 3.0

1.00 1.5 2.00.5 25 3.0

Coronary Artery Bypass Surgery (CABG)

Coronary Angioplasty

Procedures after AMI

Cholecystectomy

Hernia RepairCataract Extraction

Total Hip Replacement

Major Surgery (all cohorts combined)

Total Knee ReplacementBack SurgeryCarotid Endarterectomy

Lower in High Spending Regions Higher in High Spending Regions

Angiography

Angiography among appropriate cases

Supply Sensitive Services

Care strongly correlated with supply

Generally provided in absence of strong clinical theory

Evidence weak or non-existent on benefits.

Supply-Sensitive Care : Highest vs Lowest Spending Regions

1.00 1.5 2.00.5 25 3.0

1.00 1.5 2.00.5 25 3.0

Office Visits

Initial Inpatient Specialist ConsultationsInpatient Visits

Psychotherapy Visits% of Patients seeing 10 or more MDs

Physician Visits

Electrocardiogram

Ambulatory ECG (Holter)Echocardiogram

Diagnostic Cardiology Procedures

Lower in High Spending Regions Higher in High Spending Regions

Chest X-ray

Ventilation Perfusion ScanCT / MRI Brain

Imaging Tests

Supply-Sensitive Care : Highest vs Lowest Spending Regions

1.00 1.5 2.00.5 25 3.0

1.00 1.5 2.00.5 25 3.0

Discharges

Inpatient Days in ICU or CCUTotal Inpatient Days

Hospital Utilization

Inpatient Days

Feeding Tube PlacementICU or CCU days

Emergency Intubation

Care in Last Six Months of Life

Vena Cava Filter

Lower in High Spending Regions Higher in High Spending Regions

Upper GI Endoscopy

Pulmonary Function TestBronchoscopy

Electroencephelogram (EEG)

Specialist Procedures

FindingsMortality

Decreased Risk

Relative Risk of Death across Quintiles of Spending

1.00 1.05 1.100.95

1.00 1.05 1.100.95

ColorectalCancer

Q1Q2Q3Q4Q5

Hip Fracture Q1Q2Q3Q4Q5

MyocardialInfarction

Q1Q2Q3Q4Q5

Increased Risk

Decreased Risk

Change in relative risk of death per 10% increment in regional practice intensity: Acute Myocardial Infarction Cohort

1.00 1.02 1.040.98

1.00 1.02 1.040.98

Age < 80Age > 80

Increased Risk

FemaleMale

BlackNon-black

Other location

Non-Q MIAnterior MIInferior MI

Low risk (<15% 1yr)Moderate (15-30%)High Risk (> 30%)

Summary of Findings

Increased spending across regions is largely devoted to “supply-sensitive services”

Visit frequency, specialist services, tests, inpatient and ICU care.

Residents of higher spending regions:

Slightly worse basic access to care

Equal use of major (potentially beneficial) procedures

Quality measures generally somewhat worse

No gain in function, survival or satisfaction

Implications

Costs reflect the capacity of the system

Spending and capacity: the role of beds and medical specialists

Low MDHigh Bed

High MDLow Bed

Low MDLow Bed

High MDHigh Bed

1.19

1.34 1.35

1.18

1.59

Implications

Costs reflect the capacity of the system

Greater capacity is not necessarily better

Implications

Costs reflect the capacity of the system

Greater capacity is not necessarily better

We’re wasting 30% of current spending on supply sensitive

care alone…

Regional disparities in health care spending

Part 1 -- Unwarranted variations in U.S. health care: findings from the ‘Is More Better?’ studies

Part 2 -- What can be done about it?

Effective Care Poorly understood care processes

Failure to learn

Variation Cause

Develop systems of care capable of improvement

Reward those who provide high quality care

Construct benefits to ‘incent’ beneficiaries to become active consumers and to seek ‘high quality providers’

Remedy

Principles to Guide Interventions

Variation Cause

Effective Care and Patient Safety

Poorly understood care processes

Develop systems of care capable of improvement

MD-dominated decisions

Preference Sensitive Care

Shared Decision Making

Construct Benefits to ‘Steer’ insured to high quality providers AND ‘incent’ them to seek SDM information and coaching

Reward providers for participating in SDM

Remedy

Principles to Guide Interventions

Variation Cause

Supply Sensitive Care

Variations in supply Assumption that more is better

Micro: selective contracting with longitudinally efficient providers

Demand excellence in effective care and preference sensitive care

Macro: discourage continual increases in system capacity

Effective Careand Patient Safety

Poorly understood care processes

Develop systems of care capable of improvement

MD-dominated decisions

Preference Sensitive Care

Shared Decision making

Remedy

Principles to Guide Interventions

Regional disparities in health care spending

Part 1 -- Unwarranted variations in U.S. health care: findings from the ‘Is More Better?’ studies

Part 2 -- What can be done about it?