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The Dartmouth
July 17, 2025 | Latest Issue
The Dartmouth

Study calls for medicare reevaluation

More medical care does not result in better outcomes for chronically ill patients, according to Dartmouth Medical School researchers. Dr. John Wennberg and his co-author, Dr. Elliott Fisher, published a study calling for a complete reevaluation of how the nation manages chronic illness.

Using data from 4.7 million chronically ill Medicare enrollees, they found that Medicare spends an unnecessary $40 billion on hospital bills during patients' last two years of life. This revelation comes just after Medicare trustees released a report predicting the Medicare trust fund will be bankrupt by 2018.

The team created an interactive public database that will for the first time allow policy makers to compare the efficient use of Medicare dollars by region, state and even hospital. The report is expected to revolutionize the way the government thinks about Medicare spending.

"My hunch was that better research on the relationship between spending and health outcomes would identify potential savings that could be reallocated," Fisher said, citing the funding needs of uninsured patients as a possibility.

Using their database, the researchers determined which regions across the United States had the highest quality of care as well as which ones used the most resources such as intensive care unit beds, acute care hospital stays and specialist visits. They found that those who used fewer resources provided as high if not higher quality of care than their high spending counterparts.

Medical care can actually result in lower quality care mostly due to medical mistakes, according to the study.

"Although higher-spending regions spend more, use more resources, and have higher hospitalization rates, patients with the same disease have higher mortality rates, very likely because of medical errors associated with the increased use of acute care hospitals," the study said.

Another problem in the health care crisis is that hospitals have become the primary health care providers for chronically ill patients. If the patients were taken care of outside of a hospital setting they would receive better managed, safer and less expensive care, according to the study.

To solve this problem the report recommends developing a model which integrates home healthcare and hospice care.

In New Jersey, the state with the highest healthcare costs nationwide, patients had an average of 41.5 physician visits in the last six months of life while patients in low-cost, high quality regions like Utah had only 17 visits.

"Healthcare organizations serving these low-cost regions aren't withholding needed care," Fisher said.

According to the Valley News, the Upper Valley was not cited as one of the high spending areas.

The study suggests that part of the problem is the Medicare reimbursement program, which does not reward efficiency. Doctors and hospitals are reimbursed for every office visit and the cost of every test run, whether or not such care was necessary. The study calls for a Medicare reimbursement structure which does not penalize hospitals that reduce excessive use of services.

Another part of the problem is a lack of standardized guidelines for when to admit patients, when to perform diagnostic tests and when to refer them to specialists. The lack of guidelines is a contributing factor to the nationwide variation in resource utilization, the study said.

Wennberg said the variations also result from falsely optimistic assumptions that more aggressive treatment will help patients who "are severely ill with medical conditions that must be managed but can't be cured."

The report was made possible through the Robert Wood Johnson Foundation and the Dartmouth Atlas project, which was founded in 1993 to measure variation in healthcare resource utilization by region.The report has already received national attention and is being lauded as one of the premier research studies of the year.

"I think this is one of the most important studies to come about this year," said Nancy Chockley, president of a health care think tank in Washington D.C. "Shame on all of us if we don't act on this."