Slashing Medicare Reimbursements Curbs Treatment Overuse
For purposes of the research, patients were categorized based on the characteristics of their condition and whether the treatment they received was considered as appropriate, discretionary or potentially inappropriate. Given the high number of "inappropriate" cases identified, questions regarding the financial benefits for placing a patient on ADT arose.
Prior to the cuts, Medicare reimbursement for ADT was set at 95 percent of the average wholesale price of the drug with the average practice securing the drug for 82 percent of the average wholesale price, creating significant margins for many providers. At its peak, 500,000 men were receiving the therapy, which accounted for more than $1 billion in Medicare expenditures.
"There is very good evidence that a lot of practices profited very well from the use of ADT, Gilbert explained. "Almost 40 percent of income in some cases came from the use of this drug."
The study's authors believe there is a larger message in the research of how healthcare policy can address overutilization of healthcare services. "A reduction in very lucrative reimbursement practices for services that have mixed applications can reduce unnecessary use without reducing effective use in cases that are warranted," said Gilbert.
He noted that with even cuts in reimbursement, there was no substantial reduction in the number of cases in which the drug was given in appropriate cases. "But there was a substantial reduction—approximately 30 percent—in cases where there was concern that the drug might be overused." Gilbert said.
- CFO Exchange: Smartphones Poised to Disrupt Healthcare, Says Topol
- Consumerism Drives Healthcare Branding, Rebranding Efforts
- PA Ranks See 'Phenomenal Growth,' Lack of Diversity
- 3 Traits Personality Assessments Can't Reveal
- CNO on Hospital Redesign: 'You Can't Over-Communicate'
- How Digital Strategy Shapes Patient Engagement at Boston Children's Hospital
- Antibiotic Overuse a 'Huge Threat' to Patient Safety, Says CDC
- Carondelet to Pay $35M to Settle Fraud Allegations
- Half of All Primary Care, Internal Medicine Jobs Unfilled in 2013
- CHS Hacked, 4.5M Patient Records Compromised