Abstract 6: What Proportion of High-Cost Patients’ Inpatient Spending is Preventable?

Objective: A small proportion of patients accounts for a substantial proportion of healthcare spending in the U.S., and the majority of costs in this group are due to inpatient hospitalizations. Many interventions targeting high-cost patients have aimed to prevent hospitalizations for common medical conditions. However, there is surprisingly little data on the proportion of inpatient hospitalizations among high-cost patients that are potentially preventable. We sought to determine the proportion and dollar value of preventable hospitalizations among the high-cost Medicare population, and if these patterns differ for non-high-cost beneficiaries. Methods: We assigned standardized costs to each inpatient and outpatient service contained in standard 5% Medicare files from 2009. Patients under the age of 65, those with any Medicare Advantage enrollment, and those who died during in 2009 were excluded. Costs were summed across the year and across settings for each patient in our sample. We defined those in the top decile of cost as “high-cost” patients. We then used the Agency for Healthcare Research and Quality (AHRQ) Prevention Quality Indicators (PQIs) to identify potentially preventable hospitalizations. These include conditions such as heart failure, diabetes, hypertension, and asthma, for which good outpatient care can potentially prevent the need for hospitalization. We calculated the proportion of short-stay acute-care hospital costs that were accounted for by these preventable hospitalizations for the high-cost and non-high-cost patient groups. All costs are projected to the total Medicare sample. Results: There were 1,710,989 patients in our sample. High-cost patients were older (median age 75 versus 73), more often male (43.2% versus 39.3%), and more often black (12% versus 9%) than non-high-cost patients, and had a higher burden of comorbid illnesses. Inpatient spending, projected to the total Medicare population, was $90.3 billion. The 10% of Medicare patients that made up the “high-cost” cohort accounted for 72% ($65 billion) of all inpatient spending. However, within the high-cost group, only 9.7% of the spending ($6.3 billion) was due to preventable hospitalizations, while the remaining 90.3% ($58.9 billion) was spent on other causes of hospitalization. Within the non-high-cost group, though their overall spending was lower, a slightly higher proportion of hospitalizations were potentially preventable (14.7%, or $3.7 billion). Conclusions: Though high-cost patients account for the majority of inpatient spending, fewer than one in ten of their hospitalizations are potentially preventable through better outpatient care. Thus, focusing on outpatient interventions such as case management may not be optimally targeted. We also need strategies that make hospital care more efficient so that each episode of inpatient care is less expensive regardless of its cause.