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More Expensive Emergency Care Yields Better Results

MIT researcher finds significant return on additional health care spending

Because Americans spend more per capita on health care than do residents of any country, debate has continued for years about whether that investment yields sufficient results. Now a new study with a distinctive design, published in the Journal of Political Economy, shows that increased spending on emergency care does, in fact, produce better outcomes for patients.

“If the question is, ‘Do high-spending hospitals get better outcomes for emergency care?’ –– we think that they do,” said lead author Dr. Joseph Doyle, a health care scholar at the Massachusetts Institute of Technology (MIT). “We do find that if you go from a low-spending hospital to a high-spending hospital, you get significantly lower mortality rates.”

Analyzing patients covered by Medicare, Doyle and his colleagues found that increasing emergency-care spending by one standard deviation above the mean generates roughly a 10% reduction in mortality.

The study assessed ambulance-dispatch patterns in New York State over several years to examine how otherwise similar groups of patients fare when given varying levels of treatment; different hospitals tend to provide different levels of treatment, and thus expenses, in emergency care.

To those unfamiliar with health-care policy debates, the finding might seem predictable: you get what you pay for. But in recent years, some frequently cited studies have suggested that higher spending levels do not necessarily produce better results. Doyle, however, contends that this notion does not hold, at least when applied to emergency care.

“People have concluded from previous research that there must be huge waste in the [medical] system,” he said. “At a bare minimum, our research suggests more caution in that interpretation.”

The researchers used a pair of existing circumstances to conduct a study in which similar groups of people experienced different intensities of care. In some areas of New York State, multiple ambulance companies serve the same geographic areas but tend to deliver patients to different hospitals. In other areas, the researchers examined what happens when similar patients located on opposite sides of emergency-dispatch boundary lines wound up in different types of hospitals.

The study examined patients with 29 types of serious conditions in 40 communities, and used Medicare billing data to see what medical services were provided to them.

Studying these mechanisms provided the researchers with “a source of variation that we think is effectively random,” Doyle says, adding that it represents “hopefully a better apples-to-apples comparison” of patients than did prior studies that did not try to control for differences in which kinds of patients visit which hospitals.

Health care spending accounts for approximately 18% of U.S. gross domestic product, and Doyle refrains from asserting that there is no wasted spending in the entire industry. Part of his current research, he notes, concerns returns on spending in areas other than emergency care, to see whether higher expenses produce better outcomes regarding, say, chronic conditions. But for now, Doyle notes, an increasing body of evidence shows that emergency care is not riddled with excessive spending.

“If we’re trying to find out where the waste is, our research suggests it’s not in emergency care,” he says.

The research project received funding from the National Institutes of Health.

Source: MIT; February 4, 2015.


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