Medicare AMI Spending Up Over Past 10 Years

September 23, 2013

ANN ARBOR, MI — The inflation-adjusted cost of treating a Medicare patient with acute myocardial infarction (AMI) has risen nearly 17%, or more than $6000, over a recent 10-year period, according to a new analysis[1].

In terms of how the money is spent, investigators report that 25.6% of the risk-adjusted spending increase occurred within the first 30 days, while the remaining 74.4% of the increase in expenditures occurred between 31 days and one year after the index AMI.

"Our findings suggest that although Medicare's current bundled payments may include expenditures for patients with AMI within 30 days of the event, they do not contain spending beyond 30 days, which accounted for most of the expenditure growth for such patients from 1998–1999 to 2008," write lead investigator Dr Donald Likosky (University of Michigan, Ann Arbor) and colleagues. "This growth in the use of healthcare services 31 to 365 days after an AMI challenges efforts to control costs."

In their report, published online September 23, 2013 in JAMA Internal Medicine, the researchers state that the first 30 days after admission is the focus of bundled payment initiatives. This reimbursement structure pays hospitals for entire episodes of care rather than each individual test or procedure. However, treatment after the initial admission often remains "fee for service." Given that previous studies have also shown that Medicare expenditures per enrollee have increased in the past decade, the researchers set out to analyze expenditures from 1998–1999 to 2008 for patients hospitalized with AMI.

Declines in AMI Incidence, Rising Spending

During the decade, there was a 19.1% decline in the incidence of AMI. Patients hospitalized in 2008 tended to be older and sicker than earlier-treated patients and had more comorbid conditions. Overall, the one-year AMI fatality rate declined from 36.0% in 1998–1999 to 31.7% in 2008.

The inflation-adjusted one-year expenditure per patient increased 16.5%, an absolute per-patient difference of $6094, from 1998–1998 to 2008. Spending per Medicare patient increased 7.5%, or $1560, in the first 30 days, whereas spending per patient increased 28.0%, or $4535, in the period from day 31 to one year.

In the period from 31 days to one year, which accounted for 74.4% of the overall spending increase, spending on health agencies, hospice, or durable medical equipment, as well as skilled nursing facilities, accounted for the increase. In addition, spending on inpatient and outpatient care and physician payments accounted for the remaining increase in AMI expenditures. Overall, spending on inpatient care and skilled nursing accounted for the greatest absolute change from 1998–1999 to 2008, accounting for nearly 50% of the cost increase, or $3033.

"Increased expenditures were not largely the result of price increases (diagnosis-related-group reimbursement stayed constant or even declined in real terms) or changes in the use of technology during the index admission," report the investigators. "Instead, expenditures 31 to 365 days after the index admission rose by 28.0% because of increased use of home health agencies, hospices, durable medical equipment, skilled nursing facilities, and inpatient services."

Wake-up Call for Policy Makers

In an editorial accompanying the study[2], Dr Ashish Jha (Harvard School of Public Health, Boston, MA) asks the important question: was the additional spending worth it? The answer, he says, depends where one looks. "If we focus on the initial AMI and examine what happened during the hospitalization and the time immediately following, it appears that Medicare and its beneficiaries got a good deal," states Jha.

In this postacute period, spending is up $1560 but mortality is down 18%. The benefit in outcomes is likely the result of an emphasis on quality improvement and better available treatments, such implantable cardioverter defibrillators, which were not widely available in 1998–1999.

In contrast, the outlook regarding the late postacute period is not as positive. Spending is up in this phase by nearly 75%, yet the gains here account for smaller proportions in the improvement of clinical outcomes. He notes that readmission rates in this period are stable, but the spending per readmission is up with little evidence of patient benefit.

Overall, Jha says the study should be a "wake-up call for federal policy makers," because most of Medicare's efforts to slash spending focus only on the first 30 days, and these data suggest greater opportunities are elsewhere.

"As cost pressures have squeezed payments within 30 days of an index admission, the intensity and cost of services in this late postacute period have skyrocketed," writes Jha. "Policy makers might respond by extending the time for bundled payments well beyond 30 days (or even beyond 90 days). Reexamining the payment policies for durable medical equipment and home healthcare may be another important step."

The authors report no conflicts of interest.

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