1. Variation Across Payers
IOM Findings: Geographic Variations in Medicare and Private Health Care Spending
Variation Across Payers
Spending per person in Medicare and private payers are not correlated across local regions
However, utilization of services is correlated
Geographic variation in Medicare and private $ only partially explained by health and demographic factors
Variation Within Payers
Medicare: Spending varies by 50% across the country
Post-acute services costs explain disproportionate share of geographic variation
Private health insurance: Variation mainly (70%) a result of differences in prices paid to providers, not use patterns
Consistency Over Time High-cost areas remain high
Source: Institute of Medicine. Variation in Health Care Spending: Target Decision Making, Not Geography (Washington D.C.: National Academies Press, July 2013).