Same Disease, Different Care: C A L I FOR N I A H EALTH C ARE How Patient Health Coverage Drives Treatment Patterns in California F OU NDATION Introduction with different types of insurance coverage, to see As shown in The 2005 Dartmouth Atlas of Health whether the variations seen among traditional Care, end-of-life hospital use by chronically ill Medicare beneficiaries hold true for them as well. Medicare beneficiaries varies dramatically in The answer turns out to be yes, although the California, both by hospital and by region. patterns are slightly different and the degree of Issue Brief variation tends to be less pronounced. In one comparison of traditional Medicare beneficiaries with similar medical conditions, The analysis includes: patients at the state’s highest-use medical center n Medicare FFS for beneficiaries who were spent an average of 47 days in the hospital in their age 67 or older at the time of death; last two years of life, while patients at the lowest- n Patients with private FFS or PPO coverage use hospital spent only nine days. And Medicare who were between the ages of 55 and 64 at patients in Los Angeles received substantially more the time of death; hospital care than those in Northern California, averaging nearly 18 days in the hospital in the n Medicare HMO patients who were age 67 last six months of life, compared with those in or older at the time of death; and Sacramento (11 days), and San Francisco (13 days). n Private HMO enrollees who were between the ages of 55 and 64 at the time of death. However, this previous research has not explored In addition, the analysis includes a separate, whether these patterns of variation in care statewide comparison between HMO patients seen also occur among patients with other types of in Kaiser and non-Kaiser hospitals (see sidebar, pp. insurance coverage. 4-5). This analysis covers both Medicare (age 67 or older at time of death) and non-Medicare enrollees Do people with comparable medical conditions (between ages 55 and 64 at time of death) for both get different amounts of hospital care, depending Kaiser and non-Kaiser enrollees. on the type of insurance card they carry? Does the experience of HMO patients differ from those Both analyses took measure of similar patients in PPOs, or fee-for-service (FFS) plans? And who died, and who had one of 13 chronic can patients, regardless of insurance type, expect illnesses. The analyses tracked the number of divergent hospital care if they live in Los Angeles, hospital days patients incurred in the last two as opposed to Sacramento, or San Francisco? years of life, as a measure of the intensity of the treatment they received. This issue brief examines hospital use among patient groups in key regions across California, A pril 2008 This analysis builds on the work of the Dartmouth Atlas Patient Conditions for Survey Comparisons Project. The project began in 1993 as a study of health The study focused on patients with at least one of care markets in the United States, measuring variations in 13 key chronic illnesses. The conditions are: health care resources and their utilization by geographic n AIDS areas. More recently, the research agenda has expanded to n Cancer (solid tumors, leukemia and lymphomas) reporting on the resources and utilization among patients at n Congestive heart failure specific hospitals. For more information, see the Dartmouth n Coronary artery disease Atlas Web site at www.dartmouthatlas.org. n Dementia Diabetes with end-stage organ damage Findings n n Functional impairment To start, the analysis examined geographic variation n Liver disease (severe chronic) across five of California’s larger Hospital Referral Regions n Nutritional deficiencies (HRRs): Sacramento, San Francisco, Los Angeles, Orange n Peripheral vascular disease County, and San Diego. n Pulmonary disease (chronic) n Renal failure (chronic) As seen in previous research, there are substantial regional differences in hospital use among Medicare FFS patients, The experiences of these patients allowed for comparisons along a north-south axis (Figure 1). Patients in Los across California to evaluate the impact of a patient’s Angeles have the highest number of hospital days, insurance coverage and location on the amount and duration of their hospital care. Figure 1: Hospital Days in Last Two Years of Life, Five-Region Comparison 30 25 Hospital Days in Last Two Years of Life 20 15 10 5 0 Sacramento San Francisco Los Angeles Orange County San Diego Health Referral Region Medicare FFS Medicare HMO Private PPO/FFS Private HMO Source: Author analysis of Jan. 1, 1999 to Dec. 31, 2003 hospital discharge records from the California Office of Statewide Health Planning and Development.   |  California HealthCare Foundation Table 1: Health Referral Regions use. In both HMO groups, the ratio of highest to lowest intensity of hospital use was smaller than that of the FFS/ Number of Hospitals Included in Study, by Insurance Type PPO groups (between 1.1 and 1.2), and the north-south Hospital Referral variation was less pronounced. Medicare Medicare Private Private Region FFS HMO PPO/FFS HMO The analysis then broadened the review, adding seven Orange County* 22 19 4 8 other HRRs to the original five (Table 1). Bakersfield 13 7 3 3 Contra Costa County 8 6 2 3 In this review, as in the first comparison, Medicare FFS beneficiaries again showed the highest levels of regional Los Angeles* 95 67 15 26 variation in hospital use, and private PPO/FFS patients Modesto 10 3 2 2 closely tracked the Medicare FFS group. Alameda County 11 11 2 3 There was also regional variation among all four patient Sacramento* 25 16 6 9 groups, across the 12 HRRs, which confirmed previous findings among Medicare FFS patients exclusively (see San Bernardino 21 15 2 8 Table 4, p.6). San Diego* 25 22 6 8 Regional variation was most prominent for Medicare FFS San Francisco* 19 12 3 6 patients, but not always. The clearest variations were for San Jose 11 8 2 5 Medicare FFS patients, where there were large differences San Mateo County 7 6 3 3 between the highest and lowest utilization HRR. The amount of variation for the other three insurance types * Hospital Referral Regions for the study’s five-region analysis Source: Author analysis of Jan. 1, 1999 to Dec. 31, 2003 hospital discharge records from the tended to be smaller. However, when comparing the 90th California Office of Statewide Health Planning and Development. and 10th percentiles for all 12 regions, the amount of and patients in Sacramento the fewest. The ratio between variation was similar for all four insurance types. average use in the highest and lowest regions here is about 1.6. And again, hospital use among both the Medicare and private HMO patient groups was substantially different Patients in private FFS or PPO plans displayed similar from that of the FFS/PPO categories, and the usage hospital use patterns to the Medicare FFS group. patterns for both HMO groups were closely related to Again, patients in Los Angeles had the highest levels each other. of hospital use, and patients in Sacramento the lowest, though the ratio of highest to lowest was somewhat smaller (about 1.3). The Sacramento-Los Angeles divide is primarily a FFS/ PPO phenomenon. In contrast to the results for the FFS/PPO groups, both Medicare and private HMO patients showed much less regional variation in hospital Same Disease, Different Care: How Patient Health Coverage Drives Treatment Patterns in California   |  Kaiser Hospitals in California: Usage and Variation Kaiser Permanente has developed one of the country’s patient categories, Medicare HMO enrollees were age most tightly integrated and managed health care 67 at the time of death, and non-Medicare enrollees systems. In California, Kaiser cares for more than four were between the ages of 55 and 64 at the time million members. Its hospital capacity mirrors the of death. The analysis used a set of 13 key chronic distribution of its patients, who almost always receive illnesses. services in Kaiser hospitals, under care regimens that are The findings showed that while there was some rigorously managed by Kaiser physicians. variation among Kaiser hospitals in end-of-life hospital Previous research in The Dartmouth Atlas of Health Care use, the total variation was less, and in some measures has documented major variations in hospital use among far less, than that of non-Kaiser hospitals. California’s chronically ill Medicare beneficiaries, including The variation in hospital use by Kaiser Medicare HMO dramatically higher hospital use in Los Angeles than enrollees ranged from 12 days to 18 days, a ratio of in Northern California, and substantial discrepancies in about 1.5. In non-Kaiser hospitals, that ratio was 3.4, usage among individual hospitals. more than double the Kaiser figures. A similar pattern This suggests an interesting comparison. Would an emerged with private HMO patients, in which the ratio analysis of Kaiser and non-Kaiser HMO enrollees show of the highest-use hospital to the lowest was about discrepancies in hospital use, and would Kaiser members 1.7 for Kaiser members, and about 2.6 for non-Kaiser statewide display the north-south divide found in non- patients. HMO Medicare beneficiaries? In examining regional variations among Kaiser hospitals, This statewide analysis compared variations in hospital the north-south differences seen elsewhere did not use in the last two years of life by chronically ill Kaiser show up as strongly as those of non-Kaiser hospitals patients, both Medicare and non-Medicare, with that of (see Table 3, p. 5). HMO patients in non-Kaiser hospitals (Table 2). In both Table 2: Variations in Hospital Use, Kaiser and Non-Kaiser Hospitals Percentiles Ratio Number of Mean Lowest Use Highest Use Highest- Ratio Hospitals Hospital Use Hospital Hospital Lowest 10th 90th 90/10 Medicare HMO Patients Age 67 and Older Kaiser Hospitals 28 15.0 11.8 18.1 1.54 13.0 17.2 1.32 Non-Kaiser Hospitals 199 14.9 7.9 27.0 3.41 11.2 19.0 1.70 Non-Medicare HMO Patients Age 55-64 Kaiser Hospitals 26 18.3 14.8 24.6 1.66 15.5 20.5 1.32 Non-Kaiser Hospitals 67 20.1 12.5 32.5 2.60 15.7 24.9 1.58 Source: Author analysis of Jan. 1, 1999 to Dec. 31, 2003 hospital discharge records from the California Office of Statewide Health Planning and Development. 4  |  California HealthCare Foundation Kaiser Hospitals in California: Usage and Variation (continued) Kaiser’s Northern and Southern California regions traditional Medicare beneficiaries from the highest-use displayed similar hospital utilization rates and usage California hospital to the lowest. In this study, the ratio variation across individual hospitals. These results held among non-Kaiser Medicare HMO patients was 1.7, for both Kaiser’s Medicare and non-Medicare enrollees. and among Kaiser members, about 1.3. The research also compared Kaiser hospitals in Los One possible interpretation of these results is that Angeles County (seven facilities) to those in the San greater care integration and hospital capacity play Francisco Bay Area (11 hospitals in San Francisco, important roles in reducing regional variations of San Mateo, Santa Clara, Alameda, and Contra Costa hospital use. It might be expected that care integration counties). While there was a slight tendency toward and capacity management would be somewhat higher more hospital use in Los Angeles, the differences in in HMOs overall than in traditional Medicare. Kaiser, utilization were not statistically significant. with its level of integration and capacity management, would appear to have further lowered—but not These results indicate that hospital capacity and care completely eliminated—the incidence of regional integration systems could play a role in hospital use variation in its system. patterns. Previous research has shown that there was nearly a two-fold difference in use rates among Table 3: Regional Variations in Hospital Use, Kaiser Hospitals Percentiles Number of Mean Lowest Use Highest Use Hospitals Hospital Use Hospital Hospital 10th 90th Medicare HMO Patients Age 67 and Older Northern CA Region 17 14.8 11.8 17.6 13.0 17.1 Southern CA Region 11 15.2 13.0 18.1 13.4 17.2 San Francisco Bay Area 10 15.5 13.8 17.6 13.9 17.3 Los Angeles 7 15.6 13.4 18.1 13.4 18.1 Non-Medicare HMO Patients Age 55-64 Northern CA Region 15 18.0 15.0 20.9 15.5 20.5 Southern CA Region 11 18.8 14.8 24.6 16.7 20.3 San Francisco Bay Area 8 18.4 15.5 20.9 15.5 20.9 Los Angeles 7 19.3 16.7 24.6 16.7 24.6 Note: San Francisco Bay Area includes San Francisco, San Mateo, Santa Clara, Alameda, Contra Costa counties. Los Angeles includes Los Angeles County. Source: Author analysis of Jan. 1, 1999 to Dec. 31, 2003 hospital discharge records from the California Office of Statewide Health Planning and Development. Same Disease, Different Care: How Patient Health Coverage Drives Treatment Patterns in Californias   |  5 Conclusions The Kaiser findings also may help reinforce this The analysis showed the clearest and largest regional explanation, given Kaiser’s focus on systemic integration variations among traditional Medicare beneficiaries. In and care management, and its development of hospital most of the analyses, the amount of variation for the capacity to reflect where its members live. other three insurance groups tended to be smaller. Some previous discussions have emphasized the role Because the patterns of variation differ for the HMO of system capacity in driving regional variations. The and non-HMO patient groups, the forces driving these variations seen in this analysis suggest that these kinds variations may be closely related to differing levels of care of influences may not be the only factors in play. integration. Regional capacity influences might be expected to affect an area’s entire health care system in the same way, and Patients seeing many different providers, and receiving create similar disparities among all types of insurance. more fragmented care, are likely to end up in the However, it would still be possible that different plan hospital more often, and for longer periods of time. types respond in alternate ways to the presence of large For example, previous research among Medicare FFS numbers of hospitals. beneficiaries found that Los Angeles has many more patients who see ten or more physicians in the last six months of life than either Sacramento or San Francisco. If this happens less frequently in HMOs than with other types of insurance, that could contribute to the variations in the regional patterns. Table 4: Hospital Use Variations, 12-Region Comparison Percentiles Mean Lowest Use Highest Use Ratio Hospital Use Hospital Hospital Highest-Lowest 10th 90th Ratio 90/10 Medicare FFS 19.7 16.5 26.6 1.61 18.2 22.1 1.22 Medicare HMO 15.3 12.8 17.0 1.33 14.1 16.5 1.17 Private PPO/FFS 22.8 20.0 26.8 1.34 20.6 24.5 1.19 Private HMO 19.7 16.6 22.4 1.35 18.6 21.6 1.16 Source: Author analysis of Jan. 1, 1999 to Dec. 31, 2003 hospital discharge records from the California Office of Statewide Health Planning and Development.   |  California HealthCare Foundation Methodology average number of total hospital days, and compared the The analysis used California Office of Statewide Health results. The study adjusted for demographics and related Planning and Development discharge abstracts, which patient characteristics. Only hospitals with at least 50 are linked to death records, to identify all patients in this deaths in a group were included in the analysis. study who died between Jan. 1, 1999, and Dec. 31, For the regional variation component of the study, 2003, and had at least one of 13 chronic illnesses. averages were taken of hospital-specific patient use Hospital stays for these patients were examined for measures for all hospitals in each of the study’s 12 two years before their deaths, to count the number of Hospital Referral Regions (HRRs). The analysis included hospital days in all hospitals. Chronically ill patients who only HRRs with at least two hospitals. die are reasonably comparable from one hospital to In the Kaiser analysis, Kaiser Permanente has a number another, and provide a useful basis for comparisons of of “affiliated” contract hospitals, some of which provide resource use. In addition, adjustments were made for only emergency services for Kaiser patients, and some demographics and related patient characteristics. of which provide other services as well. For the analysis, Patients were assigned to the hospital in which they those hospitals were listed as “non-Kaiser” hospitals. received most of their care during this period. The study Were those hospitals excluded from the analysis entirely, took all patients assigned to each hospital, computed the the results would not be affected. Authors: Author: Laurence Baker, associate professor of Health Research and Policy, Stanford University School of Medicine Editor: Stephen Robitaille, consultant f o r m o r e i n f o r m at i o n , c o n ta c t : California HealthCare Foundation 1438 Webster Street, Suite 400 Oakland, CA 94612 tel: 510.238.1040 fax:510.238.1388 www.chcf.org California HealthCare Foundation   |  1438 Webster Street, Suite 400, Oakland, CA 94612  |  tel: 510.238.1040   |  fax: 510.238.1388   |  www.chcf.org