Health Affairs Study Finds Wide Variation in Medicaid Prices, Services
Some states are spending twice as much per Medicaid beneficiary as other similarly sized states, according to a study in the July issue of Health Affairs, CQ HealthBeat reports.
The study is based on data from 2001 to 2005 on individuals who were disabled, eligible only for Medicaid and received cash assistance (Attias, CQ HealthBeat, 7/7).
Researchers analyzed how the number of treatments beneficiaries received and the prices paid for services affected overall Medicaid spending in each state (McCarthy, National Journal, 7/7).
The mid-Atlantic region -- comprising New Jersey, New York and Pennsylvania -- had the most expensive care by region, resulting from high service volume and high health services prices. The South Central region -- comprising Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Oklahoma, Tennessee and Texas -- had the least costly care.
According to the study, in the 10 states with the highest spending, per-beneficiary spending was $1,650 above the national average. Seventy-two percent of that difference was related to the greater number of services that beneficiaries in those states received. Among the 10 states with the lowest spending, per-beneficiary spending was $1,161 below the national average (Zigmond, Modern Healthcare, 7/7).
According to the study, spending more per patient did not necessarily lead to better outcomes.
The study also showed that the more primary care physicians a region had, the lower the number of hospital admissions for patients with chronic conditions. According to the researchers, the federal health reform law's call for expanding PCPs could lead to a reduction in hospital admissions (National Journal, 7/7).
The researchers suggested that their findings would help Medicaid program directors and managed care organizations compare the price and volume of services in their state with other states.
The authors said, "By providing state-specific data on price and volume, we encourage decisionmakers to strive to better understand why price and volume are different in one state than another, and to make purposive decisions about whether the rates are right" (Modern Healthcare, 7/7).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.