1 Estimating non-VA Health Care Costs Todd H. Wagner

HERC2 Learning Objectives After this talk, you will After this talk, you will –Understand whether you need non-VA data –Know the strengths and weaknesses for different sources of non-VA data

HERC3 Do you need non-VA data? Many veterans have a choice in where they get care Many veterans have a choice in where they get care Many veterans who get care from VA facilities also get care from non-VA providers (e.g., Medicare, Medicaid) Many veterans who get care from VA facilities also get care from non-VA providers (e.g., Medicare, Medicaid) Perspective and objectives: these should dictate your data needs Perspective and objectives: these should dictate your data needs

HERC4 Example Any examples of studies that require non- VA data? Any examples of studies that require non- VA data?

HERC5 Sources of non-VA data Medicare data Medicare data Fee Basis Fee Basis Bills from providers Bills from providers Self-report Self-report All sources have strengths and weaknesses All sources have strengths and weaknesses

6 Medicare Data

HERC7 Medicare Data for Veterans Medicare is health insurance for people over age 65 or those with a disability Medicare is health insurance for people over age 65 or those with a disability VIReC maintains VIReC maintains –Medicare Data for all VA enrollees from 1999 through 2003 Note the delay; this may be critical for clinical trials. Note the delay; this may be critical for clinical trials.

HERC8 Medicare Institutional Claims AKA Part A (except outpatient) AKA Part A (except outpatient)  Inpatient (short/long)  Outpatient (Part B)  Home Health (Part A & B)  Hospice  Skilled Nursing Facilities –One file for each type of claim

HERC9 Medicare Non-Institutional Claims AKA Part B: AKA Part B: –Physician/supplier file  Physician, NPs, and other professionals  Clinical Laboratories  Ambulance services  Ambulatory Surgery Centers –Durable Medical Equipment (DME) file

HERC10 Medicare File Types Research Identifiable Files (RIFs) Research Identifiable Files (RIFs) Beneficiary Encrypted Files (BEFs) Beneficiary Encrypted Files (BEFs) Limited Data Set (LDS) Limited Data Set (LDS) Downloadable files (PUFs) Downloadable files (PUFs)

HERC11 Charges in Medicare Data Charges: reflect billed amount. Charges: reflect billed amount. Charges > Costs. Charges > Costs. Adjust charges using cost-to-charge ratio (CCR). Adjust charges using cost-to-charge ratio (CCR). –Cost to charge ratio is calculated from Medicare Hospital Cost Report

HERC12 Medicare Payments Payments: reflect amount paid by Medicare. This reflects: Payments: reflect amount paid by Medicare. This reflects: –Co-payments, deductibles, coinsurance –Benefit limitations –Wages, disproportionate share, IME –Direct medical education –Outlier payment Reimbursement Amount = DRG Price + Outlier Payment – Individual Payment – Other Insurance Payment Reimbursement Amount = DRG Price + Outlier Payment – Individual Payment – Other Insurance Payment

13 Fee Basis

HERC14 Overview of Fee Basis Program Pays for care at non-VA facilities when Pays for care at non-VA facilities when –it is the only source available, or –VA could save money Full range of services covered Full range of services covered Mostly pre-arranged; limited emergent care Mostly pre-arranged; limited emergent care

HERC15 Fee Basis files Subset of all VA contract care Subset of all VA contract care –Non-VA PTF has detail on hospital stays; some overlap with Fee Basis files –Substantial utilization unaccounted for SAS format at Austin SAS format at Austin

HERC16 Highlights of Financial Data Amount claimed Amount claimed Amount paid Amount paid  often much less than amount claimed Many variables relating to FMS record-keeping: invoice date, processing date, check number, check date, cancel code, etc. Many variables relating to FMS record-keeping: invoice date, processing date, check number, check date, cancel code, etc.

HERC17 User Notes Each paid invoice has a separate record. Each paid invoice has a separate record. Invoices may be sent LONG after services are rendered Invoices may be sent LONG after services are rendered Search for records in many years Search for records in many years

HERC18 Using Fee Basis Files: Cautions Beware of missing decimal places Beware of missing decimal places –ICD diagnosis codes –Payment amounts Care in community nursing homes, state veterans homes, and some non-VA hospitals may also be recorded in other files Care in community nursing homes, state veterans homes, and some non-VA hospitals may also be recorded in other files –e.g., contract nursing home care appears in DSS outpatient files

19 Bills from Providers

HERC20 Collecting Billing Data With consent, you can attempt to collect hospital bills With consent, you can attempt to collect hospital bills We are doing this for a few clinical trials We are doing this for a few clinical trials Mixed success; typically only done for inpatient costs Mixed success; typically only done for inpatient costs

HERC21 Method 1. Use self-report to identify utilization 2. Ask patient for name of hospital and approximate date 3. Have patient sign HIPAA release 4. Contact hospital for UB92 5. Cost adjust the charges reported on the bill

22 Self-Report

HERC23 Limits with Administrative Data Obtaining and analyzing claims data can be costly and time consuming Obtaining and analyzing claims data can be costly and time consuming Administrative data can be incomplete or inaccurate Administrative data can be incomplete or inaccurate –Limited benefits –Out-of-plan or out-of-pocket utilization –Capitated health plans

HERC24 What is Self Report? Cognitive process of recalling information Cognitive process of recalling information Ample opportunity for distortion and error (Khilstrom et. al 2000) Ample opportunity for distortion and error (Khilstrom et. al 2000) Self-report not valid when people lack the cognitive capabilities Self-report not valid when people lack the cognitive capabilities

HERC25 Modifiable Components 1. Recall timeframe 2. Type of utilization 3. Utilization frequency 4. Questionnaire design 5. Mode of data collection

HERC26 Questionnaire Design No standards exist No standards exist Pretest: Dillman (2000) Pretest: Dillman (2000) Use counts for responses (not categories) Use counts for responses (not categories)

HERC27 Self-Reported Costs Self-reported costs are assumed poor Self-reported costs are assumed poor Imputing costs from self-reported utilization can introduce biases Imputing costs from self-reported utilization can introduce biases

HERC28 Additional Readings Fee Basis Technical Report #18 Fee Basis Technical Report #18 Bhandari and Wagner. Self-Reported Utilization of Health Care Services: Improving Measurement and Accuracy (2006, MCRR). Available upon request. Bhandari and Wagner. Self-Reported Utilization of Health Care Services: Improving Measurement and Accuracy (2006, MCRR). Available upon request.

HERC29 Additional Links VIReC– Manages the VA Medicare Data VIReC– Manages the VA Medicare Data ResDAC (Research Data Assistance Center) for Medicare data ResDAC (Research Data Assistance Center) for Medicare data Medicare and Medicaid Medicare and Medicaid

HERC30 Additional Viewings 2005 HERC Courses 2005 HERC Courses –Talk on Medicare Data (Yu) –Talk on the Fee Basis (Smith) rces/training_course_archives.asp rces/training_course_archives.asp