Paper Example on Variation in Local and Regional Healthcare Expenditure

Introduction

The scrutiny or audit of the expenditure of medical care is vital to the smooth running of these systems. The research presented covered this issue as expository as they could from the literature review to the methodology, results and findings and the conclusion and recommendation. The tittle local and regional healthcare spending is simple at its core but very rich with the precise area of interest. Definitions and abbreviations are well established with the researcher presenting the hospital service areas (HSAs) as the local facilities and the hospital referral regions (HRRs) as the regional facilities mostly dealing with referred patients requiring neurosurgery or cardiovascular surgical procedures (Zhang, Baik, Fendrick&Baicker, 2012). The study was prompted by the disturbing trend of increased geographical variations in hospital spending, not as a result of patient characteristics nor the quality of healthcare. The literature review was creatively drafted to contain the scope, population sample and the degree of related expenditure.

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The research assumed a method that didn't involve the consent of actual participation of the patients. They utilized enrollment records, medical claims and pharmacy claims from the CMS, Centers for Medicare and Medicaid Services. The study employed a random sampling technique of 5% of the healthcare beneficiaries, which reflected 3,060, 322 beneficiaries in two years, in 2007 and 2010. This population is reasonable and varied through the age brackets and race to the disabled. The reach encompasses discrete data in sampling out the patients, and the statistical methods involved include ranges, percentages, percentiles, dispersion, and coefficients (Zhang et al, 2012). The difference in population might have presented a challenge in the research and to counter this, the authors adjusted for clinical characteristics, demographic characteristics and insurance and income status. These adjustments no doubt guaranteed consistency but in another way decelerated the credibility of the data. The study first focused on the spending of HSAs and HRRs and then considered the dispersion between the expenditure of HSAs clustered within HRRs.

The results were tabulated and also presented in well-partitioned graphs to display the crude numerical findings of the researchers. The drug and non-medical spending in a median HAS were 53 prescription drugs annually, extrapolating to about 2,912 dollars annual gross drug expenditure. The drug and medical expenditures registered a coefficient variation of 0.15, probably due to severity in illnesses and other unaccounted patient characteristics. A null hypothesis constructed for this research was that there is no systematic HSA variation within HRRs. This hypothesis was rejected as the findings registered a 59% variation in HSA drug spending within HRRs (Zhang et al, 2012). There existed a substantial variation and difference between the HAS and HRR spending. The HRRs in Manhattan had the highest adjusted drug spending with Albuquerque having the lowest spending, but there were also variations of the HSA expenditure within these HRRs. Therefore, the research revealed a misalignment in the cost of the HSA and HRRs with a majority of HSAswith high expenditures located within the margins of low expenditure HRRs and vice versa.

Conclusion

This information, therefore, calls for the adjustments of policies and resource allocations to hospitals, not because of the regional occupation but further within its unique patient needs and characteristics. These policies include levers to rein in spending in high-cost regions by reasonably lowering the Medicare payments to the regional or area providers. The research defends the adjusted outcome patterns to be in correspondence with the unadjusted trend, but it is rather hard to focus the outcome of the levers application and implementation of the policy levers using these data.

References

Zhang, Y., Baik, S., Fendrick, A., &Baicker, K. (2012). Comparing Local and Regional Variation in Health Care Spending. The New England Journal of Medicine, 367(18), 1724-1731.