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AHRQ Technical Reviews and Summaries
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Chapter  7:  Determinants of Increases in Medicare Expenditures for Physicians' Services

A18419

Prepared for:

Agency for Healthcare Research and Quality

Department of Health and Human Services

540 Gaither Road

Rockville, MD 20850

www.ahrq.gov

Contract No. 290-97-0001

Prepared by:

Southern California-RAND Evidence-Based Practice Center, Santa Monica, CA

Paul Shekelle, M.D., Ph.D.

Program Director

Sally Morton, Ph.D.

Program Co-Director

Task Order DirectorPaul Shekelle, M.D., Ph.D.
Task Order Co-DirectorMelinda Beeuwkes Buntin, Ph.D.
Research AnalystMiriam Laugesen, Ph.D.
Senior EconomistDana Goldman, Ph.D.
Data AnalystHongjan Kan, M.A.
Health Economics ExpertJose Escarce, M.D., Ph.D.
Staff AssistantsEileen McKinnon
Shannon Rhodes

AHRQ Publication No. 04-0008

October 2003

This document is in the public domain and may be used and reprinted without permission except those copyrighted materials noted for which further reproduction is prohibited without the specific permission of copyright holders.

Suggested Citation:

Buntin MB, Escarce J, Goldman D, et al. Determinants of Increases in Medicare Expenditures for Physicians' Services. Technical Review 7 (Prepared by Southern California-RAND Evidence-based Practice Center, under Contract No 290-97-0001). AHRQ Publication No. 04-0008. Rockville, MD: Agency for Healthcare Research and Quality. October 2003.

This report may be used, in whole or in part, as the basis for development of clinical practice guidelines and other quality enhancement tools, or a basis for reimbursement and coverage policies. AHRQ or U.S. Department of Health and Human Services endorsement of such derivative products may not be stated or implied.

AHRQ is the lead Federal agency charged with supporting research designed to improve the quality of health care, reduce its cost, address patient safety and medical errors, and broaden access to essential services. AHRQ sponsors and conducts research that provides evidence-based information on health care outcomes; quality; and cost, use, and access. The information helps health care decisionmakers—patients and clinicians, health system leaders, and policymakers—make more informed decisions and improve the quality of health care services.

The authors of this report are responsible for its content. Statements in the report should not be construed as endorsement by the Agency for Healthcare Research and Quality or the U.S. Department of Health and Human Services of a particular drug, device, test, treatment, or other clinical service.

Prepared for:

Agency for Healthcare Research and Quality

Department of Health and Human Services

540 Gaither Road

Rockville, MD 20850

www.ahrq.gov

Contract No. 290-97-0001

Prepared by:

Southern California-RAND Evidence-Based Practice Center, Santa Monica, CA

Paul Shekelle, M.D., Ph.D.

Program Director

Sally Morton, Ph.D.

Program Co-Director

Task Order DirectorPaul Shekelle, M.D., Ph.D.
Task Order Co-DirectorMelinda Beeuwkes Buntin, Ph.D.
Research AnalystMiriam Laugesen, Ph.D.
Senior EconomistDana Goldman, Ph.D.
Data AnalystHongjan Kan, M.A.
Health Economics ExpertJose Escarce, M.D., Ph.D.
Staff AssistantsEileen McKinnon
Shannon Rhodes

AHRQ Publication No. 04-0008

October 2003

This document is in the public domain and may be used and reprinted without permission except those copyrighted materials noted for which further reproduction is prohibited without the specific permission of copyright holders.

Suggested Citation:

Buntin MB, Escarce J, Goldman D, et al. Determinants of Increases in Medicare Expenditures for Physicians' Services. Technical Review 7 (Prepared by Southern California-RAND Evidence-based Practice Center, under Contract No 290-97-0001). AHRQ Publication No. 04-0008. Rockville, MD: Agency for Healthcare Research and Quality. October 2003.

This report may be used, in whole or in part, as the basis for development of clinical practice guidelines and other quality enhancement tools, or a basis for reimbursement and coverage policies. AHRQ or U.S. Department of Health and Human Services endorsement of such derivative products may not be stated or implied.

AHRQ is the lead Federal agency charged with supporting research designed to improve the quality of health care, reduce its cost, address patient safety and medical errors, and broaden access to essential services. AHRQ sponsors and conducts research that provides evidence-based information on health care outcomes; quality; and cost, use, and access. The information helps health care decisionmakers—patients and clinicians, health system leaders, and policymakers—make more informed decisions and improve the quality of health care services.

The authors of this report are responsible for its content. Statements in the report should not be construed as endorsement by the Agency for Healthcare Research and Quality or the U.S. Department of Health and Human Services of a particular drug, device, test, treatment, or other clinical service.

Contents

Preface

Summary

Chapter 1. Introduction

Chapter 2. Historical Trends in Medicare Expenditure Growth

Chapter 3: Decomposing the Change in Medicare Expenditures for Physicians' Services

Chapter 4. Limitations

Chapter 5. Conclusions

Appendix A. Payment for Physicians' Services Under the Resource Based Relative Value Scale

Appendix B. 1993 OLS Model Estimation Results

Appendix C. 1993 Two-part Model Estimation Results

Appendix D. Actual Characteristics of the 1993 FFS, 1993 HMO, 1998 FFS, and 1998 HMO Samples

Appendix E. Total Actual RVU Use by Beneficiary Age/Gender Categories, 1993 and 1998

Appendix F. Legislative Changes to Prices and Coverage, 1994-1998

Exhibit A

References

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