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Eugen Tarnow

 

    Analytical Thoughts

    Having a heart attack? Medicare total payments to a hospital does not guarantee a better outcome.

    Eugen G Tarnow  May 11 2015 09:40:58 AM
    By Eugen Tarnow, Ph.D.
    Avalon Business Systems, Inc.
    http://AvalonAnalytics.com

    Thanks to a FOIA by the Wall Street Journal, Medicare now releases datasets that describe what the tax payer gets for the yearly 0.5 trillion dollar payments.  

    For example, do we pay more for better quality treatments?  When it comes to heart attacks the data shows that Medicare payments hardly correlate with quality.  Below I show you the hospital total charges related to heart attack care and the corresponding "score" (% complications - lower is better).  Medicare payments represents only about 7% of the variance and even then you need a $10 million payment to lower the rate of complications from say 15% to 14%.

    Image:Having a heart attack? Medicare total payments to a hospital does not guarantee a better outcome.

    Do hospitals that charge more per heart attack do a better job?  Here the correlation is even smaller - only 1.5% of the score is associated with price.  Medicare should probably cut the payments which range from $17,000 to $27,000 to the bottom of the range.  

    Image:Having a heart attack? Medicare total payments to a hospital does not guarantee a better outcome.
    In other words, if you are having a heart attack, you might as well save the money in your wallet and go to a hospital that charges Medicare (and you) less for the treatment.