Sunday, February 14, 2010

Study shows how Medicare rewards MDs for overuse | Reuters

Study shows how Medicare rewards MDs for overuse | Reuters

CHICAGO (Reuters) -
Medicare's move in 2005 to pay doctors to do bladder cancer surgery in their offices rather than in hospitals dramatically raised the number of procedures and overall health costs, U.S. researchers said on Monday.

The findings reflect the complexity of cutting health costs in the United States, showing how in some cases Medicare -- the insurance program for the elderly and disabled -- gives doctors incentives to provide too much care, they said.
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"It's incredibly complicated," said Dr. Micah Hemani, a bladder cancer expert at the New York University Langone Medical Center, who studied changes in treatment patterns in his group practice before and after the pay hike.

"What we found based on our billing data was that the number of procedures dramatically increased without a decline in the number of hospital-based procedures," Hemani, whose study appears in the journal Cancer, said in a telephone interview.

"If you adjust for the growth of our practice and you are doing more of these procedures but your hospital-based ones don't decline, you are spending more money."

Bladder cancer is the most expensive of all cancers to treat, with an average cost from diagnosis to death ranging from $96,000 to $187,000, according to Hemani and colleagues.

In theory, the Centers for Medicare and Medicaid Services decision in 2005 to pay doctors extra to do the procedure in their offices would cost less than doing it in a hospital, he said.

Instead, the number of outpatient bladder cancer procedures in Hemani's group practice doubled after the Medicare pay hike and costs to Medicare rose 50 percent overall.

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