A new understanding of higher Medicare spending

Kaiser Health News, March 10, 2011
Some regions of the country that have been lambasted for high levels of Medicare spending actually are below the national average once the severity of patient sickness and special local expenses are taken into account, according to data from a new government analysis. Manhattan, Contra Costa County, CA, and Newark, NJ — areas suspected as places where doctors and hospitals may be performing too many procedures — actually have Medicare spending below the national average, given their patients' medical needs, according to the new calculations from the federal Centers for Medicare & Medicaid Services, or CMS. In CMS's analysis, 27 of the country's 306 hospital markets switched from higher than average to lower than average spenders after patient health and geographic cost factors were considered. Conversely, 60 regions that appeared to be low spenders in raw dollars actually were above the national average once the adjustments were made, the data show. Those areas include Ocala, FL, Mobile, AL, Tulsa, OK, and Wichita, KS.— nearly one out of every five regions.

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