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Making Sense of How Better Quality Can Be Achieved with Less Money

Janice Simmons, for HealthLeaders Media, June 4, 2009

An interesting study appeared online late last month in the journal Health Affairs on "Hospital Quality And Intensity Of Spending: Is There an Association?" Well, to break the suspense, the answer is yes—there is a connection: spending more money doesn't necessarily translate into better quality care. However, this is one issue that shouldn't be simplified too much as some reports of this study have done.

To put it in perspective, the study is significant because it is one of the first nationwide analyses ever of quality and spending at the level of the individual hospital. Followers of the Dartmouth Atlas of Health Care are familiar with studies into variations in costs and care among groups of hospitals across the country within certain regions. This makes the target even smaller.

The findings of this study could have an impact on the debate in Washington over healthcare reform legislation. The Dartmouth variation numbers have been cited frequently on Capitol Hill during health reform hearings.

Legislators and President Obama both have said that a reform plan must be able to control costs and expand access to high quality, affordable healthcare. In fact, on June 2, Obama said that he was going to discuss with key senators visiting the White House how to get "top notch quality, lower costs." This meant looking at organizations, for example, such as the Mayo Clinic in Rochester, MN, which is "able to provide some of the best health care services in the country at half or sometimes even less of the costs than some other areas where the quality is not as good," he said.

In the Health Affairs study, the data is drilled down into the hospitals themselves, which is called by the researchers "a more natural unit of analysis for reporting on and improving accountability."

The researchers, from Dartmouth and Harvard, used process of care quality measures [and not outcomes measures] from the Centers for Medicare and Medicaid Services Hospital Compare database. The measures focus on three major conditions: acute myocardial infarction (AMI), pneumonia, and congestive heart failure (CHF).

These measures are determined from the percentage of appropriate patients receiving "a specific, often low cost, evidence based therapy—depending on their conditions." Performances on these measures are compared to hospital level end of life spending based on spending for chronically ill patients age 65 years or older.

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