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Spending more on Medicare benefits seen

May 31, 2011 at 2:00 AM   |   Comments

WASHINGTON, May 31 (UPI) -- Reductions in U.S. Medicare spending in a geographic area or nationally could have harmful effects on beneficiaries' health, researchers say.

Jack Hadley, senior health services researcher at the George Mason University, and Urban Institute colleagues Timothy Waidmann, Stephen Zuckerman and Robert Berenson say greater spending on medical services means better overall health for Medicare participants.

Hadley says previous research showed Medicare spending varied greatly by geographic area, with little benefit to those who live in the higher-price areas. As a result, policymakers have considered limiting Medicare payments in high-cost areas.

The study, published in the journal Health Services Research, found spending more on Medicare medical expenses resulted in greater survival and a better overall health score -- using an index that measures perceived health and activity limitations.

The researchers used data from the Medicare Current Beneficiary Survey, which collects extensive information from Medicare participants over a three-year period.

"The surveys provide much richer information about the person's health condition than one can typically get from insurance claims data (used in the earlier research)," Hadley says in a statement.

The older research didn't look at individuals and the amount of medical care, Hadley says.

The statistical analysis indicates the individuals' health did vary with their medical care spending, Hadley says.

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