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The Centers for Medicare & Medicaid Services have introduced the Medicare Spending per Beneficiary demonstration to bring more accountability to patient care by focusing hospitals on lowering spending across the continuum of care. This metric reflects consensus from policymakers and health care professionals that hospitals and health systems should be held accountable for spending and outcomes that occur after discharge.
From a health system’s perspective, the following 3 levers can reduce per capita spending on health care: decreasing the volume of services, lowering the price of each service, and/or substituting lower-cost treatments or services (eg, generic pharmaceuticals). In this issue of JAMA Internal Medicine, Das and colleagues1 note that only 3% of total Medicare spending per beneficiary relates to preadmission costs, leaving inpatient hospital and postacute care costs as the only vehicles for reducing costs. Because hospital reimbursement rates are based on prospective payments by diagnosis related group and because hospitals’ ability to decrease inpatient length of stay without increasing adverse outcomes is being reached, opportunities for inpatient savings are also limited.
Mor V, Rahman M, McHugh J. Accountability of Hospitals for Medicare Beneficiaries’ Postacute Care Discharge Disposition. JAMA Intern Med. 2016;176(1):119-121. doi:10.1001/jamainternmed.2015.6508