Can costs be cut for high-cost Medicare patients?

In 2010, Medicare spending for acute care totaled $91.7 billion.  The majority of that spending — over 70 percent — went to pay for the care of only 10 percent of Medicare patients, known as the “high-cost cohort.”  There is a relatively small proportion of very sick, very resource-intensive, very expensive patients. 

In this study, the researchers took a look at quantifying how much cost cutting might be possible by substituting other types of outpatient care for inpatient hospitalizations and also by avoiding ED utilization.  The answer is, unfortunately, not much.  They found that the problems that bring these patients to the hospital are big catastrophic conditions — stroke and heart attack and cancer.  Things that you can’t easily substitute lower cost services for, or for which preventive measures would have a time frame measured in years.

They conclude that “only a small percentage of costs appeared to be related to preventable ED visits and hospitalizations.  The ability to lower costs for these patients through better outpatient care may be limited.”

Why do I like this article?  1.) Authoritative source — it’s out of Harvard School of Public Health, The Brigham and Women’s Hospital, and the Boston VA and includes Dr. Atul Gawande as one of the co-authors; 2.) Large scale study of Medicare data; 3.) Important subject that will interest policymakers.

Source: Joynt, K.E., and others.  Contribution of preventable acute care spending to total spending for high-cost Medicare patients.  JAMA, June 24, 2013.  Click here for access to full text: http://jama.jamanetwork.com/data/Journals/JAMA/0/jama.2013.7103.pdf  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org