Geographic Variation in Health Care Spending in the United States: Insights From an Institute of Medicine Report

• Published in: JAMA : the journal of the American Medical Association 2013-09, Vol.310 (12), p.1227-1228
• Main Authors: Newhouse, Joseph P, Garber, Alan M
• Format: Article
• Language: English
• Subjects: Beneficiaries; Consumer spending; Financing, Personal; Geography; Health Care Costs - statistics & numerical data; Health care expenditures; Health Expenditures - statistics & numerical data; Health Policy; Humans; Medicare; Medicare - economics; National Academies of Science, Engineering, and Medicine (U.S.) Health and Medicine Division; Private Sector; Reimbursement, Incentive; United States
• ISSN: 0098-7484; 1538-3598
• DOI: 10.1001/jama.2013.278139

Geographic variation in per-beneficiary Medicare spending that cannot be explained by wages and the prices of other inputs to health care or by demographic and health characteristics, as described by Dartmouth researchers, has intrigued researchers and stimulated policy debates for years. Without evidence that Medicare beneficiaries in high-spending areas have better health outcomes than those in low-spending areas, policy makers have asked whether low-spending areas were being penalized while high-spending areas were being inappropriately rewarded. Here, Newhouse and Garber summarize that Medicare spending in an area reveals little about spending by private insurers in the same area, and neither Medicare spending nor spending by private insurers in an area is a good guide to total spending in that area.