Stephanie Bouchard, Managing Editor
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RAND study finds doctors with less experience are costlier
BETHESDA, MD | November 5, 2012
A new study suggests doctors with less experience are costlier than those with more experience.
[See also: Massachusetts' physicians concerned with shortages, recruitment, working environment]
The RAND Corporation study, released Monday in the November issue of Health Affairs, found that physicians with less than 10 years of experience had 13.2 percent higher overall costs than physicians with 40 or more years of experience. Those with 10 to 19 years experience had 10 percent higher overall costs than those with 40 or more years experience; those with 20 to 29 years had 6.5 percent higher overall costs; and those with 30 to 39 years had 2.5 percent higher overall costs.
The authors used a sample of 12,116 Massachusetts physicians to explore the association between physician characteristics, such as board certification, and performance and cost profiles. The authors created a cost-profiling methodology that replicated cost-profiling methods commonly used by health plans.
[See also: IOM report outlines strategies to improve care, reduce costs]
The authors of the study volunteered two possible explanations for why physicians with less experience are costlier than physicians with more experience.
Less experienced physicians may have practice styles that are more expensive, the authors wrote. For instance, less experienced physicians may have been trained to use newer, more expensive technology as a matter of routine while more experienced physicians are not as familiar with the newer technologies and so don’t use them as much.
The authors also theorize that the cost profiling methodologies used by health plans may be weakened by measurement inadequacy. For instance, the authors noted in the study that risk-adjustment models may fail to account for patient factors that can’t be captured by health plan claims.
“In some sense, we’re trying to capture what might be underlying that variation in practice style – or (what’s) driving it,” said Ateev Mehrotra, MD, a RAND Corporation policy analyst and one of the study’s authors.
The results of the study were surprising, said Mehrotra, who is an associate professor of medicine at the University of Pittsburg’s School of Medicine. He expected to find higher costs associated with physicians with malpractice claims or disciplinary actions. No such association was found.
He said he also thought that larger practices, which, he noted, are being encouraged on the policy level as cost savers, would have lower costs, but no such association was found.
The study’s findings associating less experienced doctors with higher costs, Mehrotra said, are important on two fronts.
MGoodson say: RAND study finds doctors with less experience are costlier
There is no doubt that cost for treating specific conditions varies from one physician to another. In hospital facilities, opportunities to remove unnecessary cost such as lab or radiological exams, use of proprietary drugs when less expensive generic drugs are available and costly variations in clinical practice patterns that don’t add value to the desired clinical outcome can be identified – a formidable challenge for most provider facilities.
The information required to determine if high quality healthcare outcomes are being delivered efficiently and cost effectively resides in a number of healthcare information systems such as the materials management system, physician order entry, electronic medical records, finance, patient accounting and reimbursement. As a general rule, these systems do not exchange information so that the required data can be brought together to paint the necessary picture to make fact-based decisions.
As business intelligence systems are being configured to consolidate the information required to report on meaningful use, an opportunity is presented to additionally create the reports necessary to compare cost and labor associated with specific diagnosis related groups by physician. The consolidated data will provide the information necessary to examine variations in practice patterns that can lead to standardization of leading practices to remove unnecessary cost. Any unnecessary cost identified and removed goes directly to the improvement of operating margins with no need for additional revenues or layoffs of employees.