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Dartmouth Study on Health Care Costs

 

New York Times

Jun. 3, 2010: In selling the health care overhaul to Congress, the Obama administration cited a once obscure research group at Dartmouth College to claim that it could not only cut billions in wasteful health care spending but make people healthier by doing so.

Wasteful spending perhaps $700 billion a year does nothing to improve patient health but subjects you and me to tests and procedures that aren’t necessary and are potentially harmful, the president’s budget director, Peter Orszag, wrote in a blog post characteristic of the administrations argument.

Mr. Orszag even displayed maps produced by Dartmouth researchers that appeared to show where the waste in the system could be found. Beige meant hospitals and regions that offered good, efficient care; chocolate meant bad and inefficient.

The maps made reform seem relatively easy to many in Congress, some of whom demanded the administration simply trim the money Medicare pays to hospitals and doctors in the brown zones. The administration promised to seriously consider doing just that.

But while the research compiled in the Dartmouth Atlas of Health Care has been widely interpreted as showing the country’s best and worst care, the Dartmouth researchers themselves acknowledged in interviews that in fact it mainly shows the varying costs of care in the government’s Medicare program.

Measures of the quality of care are not part of the formula. For all anyone knows, patients could be dying in far greater numbers in hospitals in the beige regions than hospitals in the brown ones, and Dartmouth’s maps would not pick up that difference. As any shopper knows, cheaper does not always mean better.

Even Dartmouth’s claims about which hospitals and regions are cheapest may be suspect. The principal argument behind Dartmouth’s research is that doctors in the Upper Midwest offer consistently better and cheaper care than their counterparts in the South and in big cities, and if Southern and urban doctors would be less greedy and act more like ones in Minnesota, the country would be both healthier and wealthier.

But the real difference in costs between, say, Houston and Bismarck, N.D., may result less from how doctors work than from how patients live.

Houstonians may simply be sicker and poorer than their Bismarck counterparts.

Also, nurses in Houston tend to be paid more than those in North Dakota because the cost of living is higher in Houston. Neither patients health nor differences in prices are fully considered by the Dartmouth Atlas.

The mistaken belief that the Dartmouth research proves that cheaper care is better care is widespread and has been fed in part by Dartmouth researchers themselves.

The debate about the Dartmouth work is important because a growing number of health policy researchers are finding that overhauling the nations health care system will be far harder and more painful than the Dartmouth work has long suggested. Cuts, if not made carefully, could cost lives.

Looking in detail at Dartmouth’s evidence helps show why.

Criticisms on Spending

A main focus of the Dartmouth Atlas is comparing spending among the nations hospitals. To do that, Dartmouth researchers use data on how much hospitals have billed Medicare for patients with a chronic illness who were in their last six months or two years of life.

We show where the waste is in medicine, said Dr. Elliott Fisher, a physician who is one of the principal authors of the Dartmouth work and was a frequent visitor to Washington during the long legislative debate. If everyone could operate like Oregon, Seattle or the Upper Midwest, there’s huge savings.

But the atlas’s hospital rankings do not take into account care that prolongs or improves lives. If one hospital spends a lot on five patients and manages to keep four of them alive, while another spends less on each but all five die, the hospital that saved patients could rank lower because Dartmouth compares only costs before death.

It may be that some places that are spending more are actually getting better results, said Dr. Harlan M. Krumholz, a professor of medicine and health policy expert at Yale.

Failing to receive credit for better care enrages some hospital administrators. But for the Dartmouth researchers, making these administrators uncomfortable is the point of the rankings.

When you name names, people start paying more attention, Dr. Fisher said. We never asserted and never claimed that we judged the quality of care at a hospital only the cost.

In interviews, administration officials acknowledged that the Dartmouth Atlas was far from perfect. Mr. Orszag says he does not rely on the atlas alone to prove that huge savings are possible.

"What I have repeatedly said is that a wide variety of evidence suggests there is substantial opportunity for savings, and the challenge is in capturing that opportunity," he said.

Still, the Dartmouth work remains influential in Washington.

Dr. Donald Berwick, nominated by President Obama to run Medicare, called it the most important research of its kind in the last quarter-century. In March, in response to the Congressional Democrats who would have otherwise withheld their support for the health legislation, the administration made a promise. It said it would ask the Institute of Medicine, a non-government advisory group, to consider ways of putting the Dartmouth findings into action by setting payment rates that would punish inefficient hospitals and reward efficient ones.

But if that system penalizes big city hospitals like those at the Ronald Reagan UCLA Medical Center and NYU Langone Medical Center which look profligate by Dartmouth’s measure but may rank much higher by other quality indicators a battle over the validity of the Dartmouth work is almost certain in Congress.

In fact, among health policy analysts, that battle has already begun.

Critiques have been published in prominent medical journals, and more are on the way.

 

 

 

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