Variation in Practice -The Influence of Money

A recent study highlights the problem of bundling and shows how financial incentives distort care in some gastroenterology practices (Clin Gastroenterol Hepatol 2014; 12: 58-63).

Background: When needed, patients can undergo both colonoscopy and esophagogastroduodenoscopy (EGD) at the same time; when combined, the procedures are considered bundled.  It is more convenient for patients and less costly to do the two procedures during the same sedation.  However, Medicare reimbursement to physicians for bundled procedures is less than the sum of the two procedures when charged separately. This creates an incentive for physicians to unbundle these procedures.

Study design: The authors examined Medicare claims from 2007-2009 in a national, random sample (patients ≥66 years) –part of the Surveillance Epidemiology and End Results Program.

Results:

  • 12,982 had colonoscopy and EGD within 180 days.  ~35% of these were not bundled.  This included 2359 (18%) unbundled procedures which were performed within 30 days of each other.
  • Geographic differences were noted: bundling occurred less often in the Northeast (55%) and most often in the West (68%)

What does this study indicate about bundling (& human nature)?  This study indicates that physicians respond to underlying financial incentives to separate these procedures.  In our pediatric practice, we do not unbundle procedures.  The additional facility costs, use of anesthesia, costs to families from missing work, and convenience are compelling reasons to combine procedures if feasible.  However, this data indicates that unless physicians are paid the same value for each EGD and colonoscopy, there will continue to be many patients who have their procedures scheduled on separate dates.

Bottomline: Medicare and other insurance companies will save money by not paying less for combined procedures.

Another example of financial incentive influencing care with regard to ambulance and EMS care:  How Perverse Incentives Drive Up Health Care Costs / ideastream 

Life in the balance (book)

While a recent blog (“There is More to Life Than Death”) referred to the complexity of  population-based medical decisions when relying solely on mortality, clearly mortality matters a lot.  In the same NEJM issue, an article highlights the difference that expanded Medicaid coverage has on mortality in adults (NEJM 2012; 367: 1025).

Traditionally, Medicaid has covered only low-income children, parents, pregnant women, and disabled persons.  In the past decade, several states expanded coverage to include nondisabled adults without dependent children.  This study examined these efforts in three states (New York, Arizona & Maine).  Then, effects on mortality were examined from 1997-2007 in these states as well as bordering states who did not expand coverage.  This time period allowed data to be analyzed five years prior to change and five years afterwards.

Findings:

  • By broadening eligibility requirements, there was a 25% increase in Medicaid coverage.
  • States with Medicaid expansions reduced all-cause mortality by 19.6 deaths per 100,000 adults; this was a relative reduction of 6.1%.
  • Mortality reductions were greatest for older adults (35-64), nonwhites, and residents of poorer counties.
  • The authors note that these changes do not prove causality.  However, there are implications for the affordable care act which allows expansion of eligibility up to 138% of the federal poverty level.

Despite apparent improvement in mortality, the cost, logistics and politics of expanding medical coverage remain unclear. In Georgia, the decisions on expanding medical coverage are quite controversial (see links below). My view: I think everyone in this country needs at least basic medical coverage.  This saves lives.

Deal rejects expansion of Medicaid | www.ajc.com

Expand Medicaid? – Blogs – Atlanta Journal-Constitution