MNCM News

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New report seeks to better understand the cost of care at Minnesota medical groups

New report seeks to better understand the cost of care at Minnesota medical groups

A new report from MN Community Measurement (MNCM) highlights the significant variation of costs across medical groups in Minnesota and examines the drivers that impact and influence health care costs.

“The continued rise of health care costs and the burden this places on families, businesses and the community makes it critical for medical groups and the community to work together,” said Jim Chase, MNCM President. “This is our endeavor in this new report.”

The 2016 Cost & Utilization Report features analysis and comparative data on medical group performance in Total Cost of Care (TCOC), which includes all costs associated with treating commercially-insured patients, including professional, facility inpatient and outpatient, pharmacy, lab, radiology, behavioral health and ancillary costs. MNCM posted total cost results in the fall on MNHealthScores.org. New in this report is information that breaks out the total cost into price and utilization.

This report shows the variation or difference in total cost by medical group. Further, the report shows how much of the variation was due to the amount medical groups were paid relative to others and how much was due to the utilization or use of services. The report also contains more detailed utilization measures such as the rate of admissions, emergency room visits, office visits and pharmacy use, using the same patients and time period as TCOC.

For example, the 2016 Cost & Utilization Report shows that depending on where you go for care:

  • A strep test can range from $8 to $101
  • Total Cost of Care can range from $365 to $914 per month on a risk adjusted basis
  • Amount of resource use for a patient ranges from 22 percent below average to 33percent above average, after accounting for patient risk
  • Emergency room use (utilization of ER as a health care service) ranges from 37 percent less than expected to 104 percent more than expected, after accounting for patient illness

A goal of the 2016 Cost & Utilization Report is to help medical groups better identify opportunities to reduce costs for their patients. The report helps evaluate the categories of care that are driving the majority of providers’ costs and the medical groups can then take actions to reduce their costs and provide more efficient care. The report helps consumers make informed decisions on where to receive care. Further, the report can be used by health plans, employers, and policy makers, all of whom have a stake in addressing the challenges of rising health care costs.

The 2016 Cost & Utilization Report includes a suite of measures which encompasses 119 separate measures of cost and utilization to give a comprehensive view of the drivers of health care costs.

The 2016 Cost & Utilization Report provides insight into individual procedure costs (Average Cost per Procedure chapter), statewide and regional views into total cost of care (TCOC chapter), along with newly published perspective on the resources used (Resource Use and Price Index chapter) and the utilization of health care (Utilization Ratios chapter). When possible, this report displays information on these measures statewide, regionally, and by medical group for ease of analysis.

Reviewed and considered as a whole or individually by chapter, these measures provide unique insight into tracking, comparing and taking actions to manage and reduce health care costs.

The results of these measures are based on 2015 health insurance claims of more than 1.5 million commercially-insured patients enrolled with four Minnesota health plans: Blue Cross and Blue Shield of Minnesota, HealthPartners, Medica and PreferredOne.

View the current, and previous MNCM cost of care reports here.