Now They Tell Us: Obama-Care Cost-Cutting Study From Formerly 'Wonderful' Group Now Seen As Dangerously Faulty
Another "now they tell us" moment from the Times on Obama-care appeared on Thursday's front page: "Study Cited for Health-Cost Cuts Overstated Its Upside, Critics Say" by health reporters Reed Abelson and Gardiner Harris. The study originated from the obscure Dartmouth Atlas of Health Care group and was heavily promoted on Capitol Hill by Congressional Budget Office director turned Obama budget director Peter Orszag.
Abelson has trod lightly over this ground before, in a December 23, 2009 story, pointing out flaws in the Dartmouth study, but this is the first Times story that challenges the findings root and branch. This after years of Times reporters and writers promoting the study, itself heavily promoted by Orszag.
In selling the health care overhaul to Congress, the Obama administration cited a once obscure research group at Dartmouth College to claim that it could not only cut billions in wasteful health care spending but make people healthier by doing so.
Wasteful spending - perhaps $700 billion a year - "does nothing to improve patient health but subjects you and me to tests and procedures that aren't necessary and are potentially harmful," the president's budget director, Peter Orszag, wrote in a blog post characteristic of the administration's argument.
Even Dartmouth's claims about which hospitals and regions are cheapest may be suspect. The principal argument behind Dartmouth's research is that doctors in the Upper Midwest offer consistently better and cheaper care than their counterparts in the South and in big cities, and if Southern and urban doctors would be less greedy and act more like ones in Minnesota, the country would be both healthier and wealthier.
But the real difference in costs between, say, Houston and Bismarck, N.D., may result less from how doctors work than from how patients live. Houstonians may simply be sicker and poorer than their Bismarck counterparts. Also, nurses in Houston tend to be paid more than those in North Dakota because the cost of living is higher in Houston. Neither patients' health nor differences in prices are fully considered by the Dartmouth Atlas.
The mistaken belief that the Dartmouth research proves that cheaper care is better care is widespread - and has been fed in part by Dartmouth researchers themselves.
The debate about the Dartmouth work is important because a growing number of health policy researchers are finding that overhauling the nation's health care system will be far harder and more painful than the Dartmouth work has long suggested. Cuts, if not made carefully, could cost lives.
But the atlas's hospital rankings do not take into account care that prolongs or improves lives. If one hospital spends a lot on five patients and manages to keep four of them alive, while another spends less on each but all five die, the hospital that saved patients could rank lower because Dartmouth compares only costs before death.
After some sorting of disparate views, Abelson and Harris suggest the Dartmouth team overreached in its cost-cutting rhetoric:
Because some regions spent nearly a third more than other regions without any apparent benefit, the Dartmouth team concluded that at least one dollar in three was wasted by Medicare. When applied generally to the nation's health care system, that meant about $700 billion could be saved.
But as it began publicly discussing its research, the Dartmouth team often extrapolated beyond this basic finding. Not only do high-spending regions fail to provide better care, the Dartmouth team began to argue, but those regions actually offer worse care.
In other words, there is little evidence to support the widely held view, shaped by the Dartmouth researchers, that the nation's best hospitals tend to be among the least expensive.
The Times uncovered similar problems with Dartmouth's regional data, such as ranking New Jersey last because of its high costs, when the federal government ranks New Jersey second in quality of care nationwide.
A June 6, 2007 column by economic writer David Leonhardt called the group behind the study "wonderful."
These numbers come from the wonderful Dartmouth Atlas of Health Care. The Dartmouth researchers adjust the numbers to take into account age, race and sex, which is another way of saying that there is no good explanation for the huge variations they find.
Times health care reporter Robert Pear has cited the Dartmouth study favorably on several occasions. From March 3, 2008:
Researchers at Dartmouth Medical School have found large variations in the amount of hospital care and other services that people with the same condition receive in different parts of the country. In some regions, where doctors favor more intensive treatments, Medicare spends much more without getting better results for patients.
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