The Wennberg Dartmouth Group Admits Defeat

Oct. 5 (LPAC)--Leading staff from the Dartmouth Institute for Health Policy and Clinical Practice, the source of the fraud circulated for the past six months by President Obama that one third of Medicare expenditures is unnecessary medical care, have admitted defeat. The New England Journal of Medicine published an article on Sept. 24, 2009, entitled ``Getting Past Denial: The High Cost of Health Care in the United States,'' authored by Dartmouth researchers including Elliott Fisher, MD, which concludes that unjustified regional variations in health care spending total 9.5% of total costs, not the 33% as previously claimed.

The data used in this article is individual data from the Medicare Current Beneficiary Survey, which includes individual health status by self-assessment, income, health care utilization, and Medicare spending. This data is in stark contrast to the data in the Dartmouth Atlas, which ignores socioeconomic indicators such as income, and is also in contrast with prior studies by the Dartmouth group which used zip code geographic area aggregated data, such as zip code area median income, and which therefore hid between one third and one half of existing poverty.

True to their reputation for fraud and lying, this Dartmouth Institute study nowhere states the 9.5% total variation, nor does it give any overall percent total variation, which is remarkable in view of the obsession that Dartmouth has had for years regarding calculating the supposedly exact total amount of what they regard as wasted health care. The article is full of partial statistics, such as the supposedly small role of poverty and disease severity in accounting for regional variation in Medicare expenditures. It is only by visually inspecting their total cost bar graph that the truth pops out. The key figure in the article is a bar graph showing cost per individual Medicare patient per year. The United States is divided into regions, presumably the same 306 regions used in the Dartmouth Atlas, but not specified in the article, and the regions are arranged by average cost per patient per year in ascending order. These regions are then grouped into five equal population quintiles, going from lowest to highest cost. The average cost for each quintile is represented in the graph.

The bar graph shows that the highest quintile cost is much higher than the lowest, and is quite dramatic in appearance. However, on closer examination, there are only four bars in the graph, not five. The text description of the graph explains this: the bars are the amounts of each of the second through fifth quintile that exceed the lowest quintile, which is not shown. And the height of the highest bar is noted to be 50% of the height of the first, not shown, quintile.

Now you can do the calculation, by looking at the bar heights. The four bars shown are approximately $500, $800, $1500, and $3300. If the highest bar is 50% of the height of the first quintile (which is not shown), then the first quintile must be $6600. Thus the actual heights of the five quintiles are $6600, $7100, $7400, $8100, and $9900, and the total of the five bars, to be used in the calculation below, is $39,100. Each of the four bars shown in the figure is subdivided into the portion of the cost due to race, health factors, income, and a leftover segment termed regional factors. It is the regional factors that the article calls unnecessary health care. By visual inspection, the regional factors portions of the bars are at most $100, $500, $800 and $2300, totaling $3700. These numbers can be used to find the overall proportion of total costs that the study authors think is unnecessary medical care. Thus, the study finds that $3700 out of a total of $39,100 is regional variation that is not accounted for by disease severity or patient income. This is 9.5% of the total cost.

The main financial support for the Dartmouth Institute is from the Robert Wood Johnson Foundation, and health insurance giants such as Aetna and Wellpoint. The RWJ website proudly recounts the crucial support that RWJ has given to managed care and HMOs, starting from the time that the Nixon administration approved HMO legislation in 1973, and saving HMOs numerous times from oblivion by direct grants and other support. The next time your physician tells you that your insurance company denied a service that you and your physician felt is necessary, you can thank the Robert Wood Johnson Foundation. And the next time you see a Dartmouth Institute study showing unnecessary health care, you can thank the moneybags listed above. By the way, speaking of conflicts of interest as Dartmouth Institute founder John Wennberg is wont to do, the stocks of the major health insurance companies have gone up 30% in the past few months, as Obama has promised to force 40 million uninsured Americans to buy private insurance policies, with government bailout support.