Medicare Spending on Patients Varies Widely by State, Region

New map reveals regional differences; more treatment doesn't necessarily mean better health.

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There's no good explanation for why Medicare spent more than $9,500 per patient on healthcare in New York in 2006 but just over $5,300 per patient in Hawaii. Long winters may take a toll on people, but seniors in New York are just not that much sicklier than those in Hawaii. (You can click here to check out how Medicare spending in you area stacks up.) For more than 20 years, the Dartmouth Atlas Project has been documenting such regional variations, and their new analysis of Medicare spending between 1992 and 2006, published this week in the New England Journal of Medicine, once again illustrates the point, for anyone who still needs convincing, that more healthcare doesn't necessarily result in better health.

The authors make the case that differences in spending growth exist largely because doctors' treatment decisions are influenced by such local conditions as the availability of hospital beds, imaging centers, and the like. So, for example, a patient suffering from mild pneumonia might be admitted to the hospital in a city where there are lots of available beds, whereas he might be sent home to recuperate if he lives somewhere where hospitals beds are scarce. Another contributor: The healthcare system rewards doctors more for seeing patients and for performing procedures than for actually improving patients' health.

"We believe that these discretionary decisions, judgment calls on the part of physicians, are strongly related to local capacity," says Elliott Fisher, a professor of medicine at the Dartmouth Institute for Health Policy and Clinical Practice and the lead author of the study.

This research should embolden patients to question doctors closely about the treatment they recommend, says Fisher. "A healthy skepticism is the most powerful tool a patient has in the current healthcare economy," he says. And since you're probably paying more out of pocket for medical care than you have in the past, you have a strong financial incentive to keep costs under control. Take the example of a patient with well-controlled blood pressure and no other medical problems. How often should this patient visit the doctor? In focus groups, Miami doctors said they'd see that patient every month. In Oregon, the answer was quite different: Physicians wouldn't expect to see that patient more often than every six to 12 months.

Obviously, it's not easy for a nonmedical person to judge when care is necessary. But if your doctor suggests a course of treatment, having a conversation about it may be helpful for both patient and doctor. Here are a few questions you might ask:

  • Is this visit necessary? Could we do this by phone?
  • Do we need to get this CT scan/lab work/procedure done now, or could we do it later?
  • Is there a generic equivalent for this drug that might be just as effective?
  • Just remember: You literally don't need to take medical advice lying down.

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