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Obama Administration gets White Paper on Health Care Spending

Newswise — "Unwarranted geographic variations" in U.S. healthcare spending—driven partly by the local supply of medical resources—should be a key target for healthcare reform efforts under the Obama Administration, according to a new white paper by a Dartmouth College research group.

The report was written by James A. Weinstein, D.O., M.S., Editor in Chief of Spine, along with fellow members of The Dartmouth Institute for Health Policy and Clinical Practice (TDI).

Spine is published by Lippincott Williams & Wilkins, a part of Wolters Kluwer Health, a leading provider of information and business intelligence for students, professionals, and institutions in medicine, nursing, allied health, pharmacy and the pharmaceutical industry.

The TDI white paper identifies key priorities for the incoming administration's health care strategy, including a shift toward organized systems of care, an emphasis on informed patient choice and shared decision-making, a physician workforce strategy that meets the needs of organized care, and a federal science policy providing an evidence base for cost-effective care.

Differences in Spending Don’t Lead to Better Health Outcomes
For 20 years, Dartmouth Atlas Project at TDI has documented "remarkable differences" in Medicare spending across U.S. regions.

For example, a previous study led by Dr. Weinstein and published in Spine identified wide regional variations in the rate of lower back surgery—including 20-fold variation in an increasingly frequent procedure called lumbar fusion.

But, according to the white paper and Atlas research, the variations in spending are unrelated to the underlying health of the population and—most importantly—do not lead to any improvement in health outcomes.

Even though patients in some regions receive more intensive care, they do not receive higher-quality care, nor do they have improved survival or better quality of life, the Dartmouth team has found.

Ironically, because they are exposed to more risks during hospital care, patients receiving more care may actually be at higher risk of death.

"These insights therefore overturn the conventional views that more spending on health care translates automatically into better health outcomes," according to the white paper.

The report cites "supply-sensitive" medical care as a major cause of regional variation. Especially for progressive chronic diseases like cancer or diabetes—for which there are often no evidence-based guidelines for routine care—spending is largely driven by the local supply of health care resources.

Recommendations for the Obama Administration

The findings have important implications for health care strategy, the TDI group believes.

 They call for "a multi year plan to reduce overuse of supply-sensitive care, promote the growth of organized care, and move the nation toward cost-effective management of chronic illness."

In many if not most cases, efforts to improve the quality and efficiency of care would mean reducing capacity—eliminating overused health care resources.

The plan also includes a shift toward "preference-sensitive care," focusing on patient information and choice of treatments where legitimate options exist.

The authors also recommend a change in physician workforce policy, designed to increase the number of primary care doctors rather than hospital-based physicians or specialists.

They also call for a change in federal science policy, emphasizing rational, evidence-based approaches to care for chronic diseases.

"Success in this effort will not only improve the quality of care, it will make it possible to extend coverage to America's uninsured without inducing a major increase in health care spending," according to the white paper.

Dr. Weinstein and colleagues believe their recommendations will be an important step toward the goal of providing coverage to the uninsured.

With better organized, more efficient care, the overall cost impact of covering the uninsured should be much smaller than previously thought—as long as healthcare capacity is not increased.