Report on heath costs relies on skewed data (pdf)
by Bill Broydrick
After noting the media coverage surrounding the recent Government Accountability Office (GAO) report on health care costs in Wisconsin, I decided to read it for myself. The data it uses left me scratching my head.
All I can say is that this study has as much to do with health care as astrology does with predicting the future. I have listed some problems:
· This study does not reflect the total universe of health care. It’s population was made up only of federal employees. There simply aren’t that many federal employees here in Wisconsin, which would skew the results.
· The study did not use data from all 331 metropolitan areas. For instance, it only used 319 areas when looking at physician prices, and only 232 when looking at hospital stay prices. The GAO excluded some metro areas because, for instance, “there was an insufficient number of hospital stays to support our price analyses.” So some cities with even lower numbers of federal employees were excluded but Wisconsin’s cities were left in. This skews the numbers against Wisconsin even more.
· Other data was left out, mainly because some of the numbers were too complex for useful analysis. For instance, the report excluded hospital stays that involved multiple providers. It also excluded some physician visits that could not be “uniformly classified.” This further takes away from the full story on health care costs across the country. The report, using this skewed, and, I might add, years-old data, concludes that health care costs in Wisconsin are high because physician and hospitalstay prices are high.
Contradictory Findings
However, the report then contradicts itself. It finds that total costs, or spending per enrollee in the system, is actually much lower compared to other metro areas. Here is how this breaks down:
When looking at hospital prices, two Wisconsin cities are in the top 10.
When you look at physician prices, 11 Wisconsin cities are in the top 20.
But, when looking at total spending per enrollee, only two Wisconsin cities are in the top 35. In fact,
the other nine cities drop off the list entirely. This shows another problem with the how data was
collected. Did those nine other cities disappear off the map?
I was disappointed by this study. The high cost of health care is an important issue for the business
community here in Wisconsin and nationwide. There are many reasons for it that need to be looked at,
but I think the GAO report sent some people down the wrong path.
In the meantime, our health care providers in Wisconsin need to continue their efforts to move towards
greater transparency, allowing consumers to make informed choices about their health care. This is the
best way to reduce costs in Wisconsin.