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June 16, 2010

Payment Policy Based on Measurement of Health Care Spending and Outcomes

JAMA. 2010;303(23):2405-2406. doi:10.1001/jama.2010.817

Measuring variation in spending and outcomes is a critical component of reforming physician and hospital payment policy. Analysis of area and hospital variations has a storied history1 and is increasingly common in media reports.2 If higher spending does not lead to better outcomes, health care could be delivered far more cost-effectively. But if approaches to measuring costs and outcomes are flawed, reductions in spending might yield worse outcomes.

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