Thursday, February 18, 2010

A Map to Bad Policy — Hospital Efficiency Measures in the Dartmouth Atlas | Health Care Reform Center - NEJM

by Peter B. Bach, M.D., M.A.P.P.

In showing that regional spending variations do not correlate with differences in disease burden or outcome, the Dartmouth Atlas of Health Care has felled the notion that higher health care spending necessarily leads to improved health outcomes. Policymakers have seized on two possible ways to wring savings out of this information. The health care reform bill passed by the House of Representatives contains provisions for identifying regions where Medicare spending appears disproportionately high and adjusting payment rates accordingly. And some policymakers, including President Barack Obama, have proposed that the features of high-performing, “efficient” health care systems should be identified and their lower-cost practices emulated.

Dartmouth Atlas researchers have also begun attempting to convert their observations into cost-saving policies. By analyzing Medicare claims for people who have been treated in hospitals and have died, they aim to identify and rank high- and low-efficiency hospitals.1 Because the Atlas is so influential, their rankings could have broad effects on policy. They could affect hospitals’ payments and prestige, and Consumer Reports is already publicizing them to consumers ( Given their potentially far-reaching implications, it is concerning that the rankings are unsound, both conceptually and methodologically.

The conceptual problem lies in the fact that in Atlas analyses all health care costs that are incurred by patients over the 2 years before their death are attributed to the hospital where they were admitted most frequently during that period. This method assumes that the hospital controls all, or at least most, patient care, even if it occurs outside the hospital or in another hospital. It thus seems to presuppose a system in which hospitals are accountable for all care — perhaps a noble long-term objective, but not a current reality.
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