Medicare study underscores challenges of reducing health costs

A new study of Medicare’s effort to cut costs and reduced hospitalizations for older patients with chronic diseases found disappointing results (Source: “Medicare campaign falls short in attempt to cut costs,” Akron Beacon-Journal/AP, Feb. 11, 2009).

The results of the study, which appeared in last week’s edition of the Journal of the American Medical Association, shed some light on the challenges facing the Obama Administration and the states as they undertake health reform efforts aimed at reducing costs and improving quality.

The Medicare program was set up at 15 centers across the country and involved seniors who mostly had serious, but common, illnesses such as diabetes, heart disease and lung disease. Only two of the 15 centers reduced hospitalizations and none of the centers reduced costs.

''The only way you can really (reduce costs) is by changing patients' behavior and by changing physicians' behavior, and both things are really hard to do,'' said study author Randall Brown, a researcher at Mathematica Policy Research Inc., in Princeton, N.J., which was hired to evaluate the programs.