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Published April 19, 2004; Category: ARTS & SCIENCES
Glut of specialists drives up costs
Katherine Baicker
(photo by Joseph Mehling '69)
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States with higher Medicare spending often provide lower quality, less effective care to Medicare beneficiaries, according to a new study by Dartmouth economists Katherine Baicker and Amitabh Chandra. The study, published in the current issue of Health Affairs, shows that spending more money does not necessarily translate into better care for the elderly.
States spending more money per Medicare beneficiary are likely spending those dollars on intensive, expensive care instead of more effective care, the study's authors said. High-spending states also are likely to have a greater concentration of specialists.
The study examined state-level differences in spending per Medicare beneficiary and the quality of care provided. Higher spending did not reflect higher quality care for patients. For example, New Hampshire, which spent about $5,000 per Medicare beneficiary, had the highest overall quality ranking, while Louisiana, which spent the most per Medicare beneficiary at $8,000 per person, had the lowest overall quality ranking.
Amitabh Chandra
(photo by Joseph Mehling '69)
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"Health-care leaders should not make the mistake of thinking that we can only improve the quality of health care delivered to elderly Americans by spending more money," said Baicker, Assistant Professor of Economics. "Instead, we could simply use existing dollars much more effectively."
Baicker and colleague Amitabh Chandra, Assistant Professor of Economics, said that higher spending is unlikely to cause lower quality care, but is an indicator of a particular style of health-care provision and resources. In fact, the composition of the physician workforce - the mix of specialists and general practice physicians in a given area - play a critical role in determining the use of highly effective care.
By TAMARA STEINERT
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