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Geographic variation in Medicare spending has been extensively studied over the past 40 years, most notably by researchers at the Dartmouth Institute for Health Policy and Clinical Practice. Medicare spending varies substantially across hospital referral regions (HRRs), even after differences in patient case mix are adjusted for, and additional spending does not appear to improve health outcomes for beneficiaries, nor is it associated with higher care quality.1,2 These data collectively have led many to conclude that there is wasteful health care spending within Medicare that could be reduced through policy interventions aimed at reducing excessive practice variation in high-spending geographic areas.
Swisher-McClure S, Bekelman J. Diagnostic Imaging Use for Patients With Cancer: Opportunities to Enhance Value. JAMA Oncol. 2015;1(2):194–195. doi:10.1001/jamaoncol.2015.31
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