Research Reports from Pennsylvania State University (Penn State) Provide New Insights into Health Services Research (Discovering healthcare provider behavior patterns through the lens of Medicare excess charge)

Health Policy and Law Daily

2021 JAN 22 (NewsRx) -- By a News Reporter-Staff News Editor at Health Policy and Law Daily -- Data detailed on health services research have been presented. According to news reporting out of Pennsylvania State University (Penn State) by NewsRx editors, research stated, “The phenomenon of excess charge, where a healthcare service provider bills Medicare beyond the limit allowed for a medical procedure, is quite common in the United States public healthcare system. For example, in 2014, healthcare providers charged an average of 3.27 times (and up to 528 times) the allowable limit for cataract surgery.”

Our news journalists obtained a quote from the research from Pennsylvania State University (Penn State): “Previous research contends that such excess charges may be indicative of the actual amount that providers bill to non-Medicare patients and subsequent cost-shifting behavior, where a healthcare provider tries to recoup underpayment by Medicare from privately insured, self-pay, out-of-network, and uninsured patients. The objective of this study is to examine the drivers of a provider’s excess charge patterns, especially the extent to which the degree of excess charges may be associated with physician characteristics, Medicare reimbursement policy, or socioeconomic status and demographics of a provider’s patient base. Using data from the 2014 Medicare Provider Utilization files, we identify three procedures with the highest variation in Medicare reimbursements to study the excess charge phenomenon. We then employ a two-step cluster analysis within each procedure to identify distinct provider groups. Each procedure code yielded distinct healthcare provider segments with specific patient demographics and related behavior patterns. Cluster silhouette coefficients indicate that these segments are unique. Three random subsamples from each procedure establish the stability of the clusters.”

According to the news reporters, the research concluded: “For each of the three procedures investigated in this study, a sizeable number of healthcare providers serving poorer, riskier patients are often paid significantly lower than their peers, and subsequently have the highest excess charges. For some providers, excess charges reveal possible cost-shifting to private insurance. Patterns of excess charges also indicate an imbalance of market power, especially in areas with lower provider competition and access to health care, thus leading to urban-rural healthcare disparities. Our results reinforce the call for price transparency and an upper limit to overbilling.”

For more information on this research see: Discovering healthcare provider behavior patterns through the lens of Medicare excess charge. BMC Health Services Research, 2021,21(1):1-18. (BMC Health Services Research - http://bmchealthservres.biomedcentral.com). The publisher for BMC Health Services Research is BMC.

A free version of this journal article is available at https://doi.org/10.1186/s12913-020-05876-1.

Our news editors report that additional information may be obtained by contacting Sagnika Sen, School of Graduate Professional Studies, Pennsylvania State University. Additional authors for this research include Amit V. Deokar.