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Miami leads nation in Medicare spending
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Photo: from Dartmotuh Atlas Project
At a time when the administration has made healthcare reform a priority, much of the focus has been on costs, particularly the wide disparity between how much is spent per person in different regions of the country. Because Medicare is a national program with an available database of claims information, researchers can study these differences with respect to those over 65.
In fact, that’s exactly what a team of Dartmouth scientists has been doing for the past two decades. What they learned is that Medicare spends a staggering $16,351 a year per Miami patient which is far more than anywhere else in the country and about twice the 2006 national average of $8,304.
According to a report in the St. Petersburg Times , the typical senior in Miami sees his or her physician 106 times, “receiving an astonishing array of lab tests, MRIs and medical procedures and spends a month in hospital beds.” On the other hand, only thirty miles to the north in Ft, Lauderdale, Medicare spends $9816 per senior while Sarasota on the west coast of the state spends $7,467, which is below the national average.
Despite the impulse to assume that seniors in Miami are sicker or that they are healthier because they get more care, neither is true. In fact, there is little evidence, according to the Dartmouth group that patients actually benefit from these wild differences in Medicare spending. Based on this data, the White House budget director Peter Orszag contends in one of his blog posts that “an estimated $700 billion a year spent on health care that does nothing to improve patient health, but subjects you and me to tests and procedures that aren't necessary and are potentially harmful -- not to mention wasteful."
Holly Benson, secretary of the Florida Agency for Health Care Administration blames the high Medicare expenditures in Miami to the fact that there are more health care providers, hospitals and outpatient facilities there which invites more consumption of health care. Her conclusion has been validated by the Dartmouth group nationally.
What is most disturbing is that the data also shows that in some instances, more is not only not better, it may actually be much worse. Quality of care is sometimes lower in high-spending areas, the Dartmouth researchers say. Excessive procedures and tests can expose patients to more risk of hospital infection and medical error.
In 2009, health spending in the United States is expected to total $2.5 trillion. At the current rate of growth, this will consume one out of every $5 Americans earn in the next decade.
Dr. Gawande wrote a well-researched article in the New Yorker about a small town in Texas where Medicare spending costs per individual in 2006 was $15,000, almost as high as Miami. President Obama has apparently used this as at least part of the basis for his recommendation to slash an additional $313 billion in Medicare, Medicaid and other healthcare programs from the federal budget.
Many providers acknowledge the need to cut costs, but worry that across the board reductions in reimbursement is not addressing optimal care management. Senator Nelson, Florida’s senior senator, agrees that the system needs to be more efficient, but like many healthcare providers, opposes across the board cuts without defining what is the best way to manage a particular medical condition. Kathy Castor, a U.S. representative from Tampa, also acknowledges the complexity of cutting costs and care. She favors oversight groups, led by medical professionals, as a way to bring spending under control.
Below is an example of spending costs taken from the Dartmouth Atlas Project:
Per person health care spending, measured by 2006 Medicare reimbursements:
FLORIDA
Statewide average $9,379
Miami $16,351
Fort Lauderdale $9,816
St. Petersburg$9,103
Tampa $8,991
Clearwater $8,697
Orlando$8,588
Sarasota$7,467
UNITED STATES
National average $8,304
McAllen, Texas$14,946
Manhattan$12,114
Boston $9,526
San Francisco $8,331
Charlotte $7,742
Atlanta$7,363
Green Bay, Wis. $6,810
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