As such, we are surprised and dismayed at how policymakers are using the findings as the map for healthcare reform in Washington, D.C. We are also frankly appalled at how The New Yorker article by Dr. Atul Gawande has seemingly become the guidepost of reform for policymakers. The reason is that the conclusions that The White House and much of Congress have drawn from The New Yorker article are, at best, suspect and, at worst, completely wrong. Reengineering 20% of the economy is a large task, in our view, and getting the facts straight is important.
At first blush, McAllen and El Paso are quite similar:
Based on these similarities, McAllen is in many ways a more desirable option for hospital care.
So, what about the real differences between McAllen and El Paso?
Overall, and not just for the Medicare and Medicaid population data (which were central to the Atlas and The New Yorkerperspective), McAllen’s average cost per case is $315.00 less than in El Paso, representing in total $23.6 million in incremental costs that could be saved if all of the El Paso cases had been treated in McAllen hospitals. For policymakers who are concerned about the price paid by the uninsured, the average charge per case is $7,841 more in El Paso than in McAllen.
Importantly, the “excessive” costs attributed to McAllen do not occur in McAllen, or even in Hidalgo County. A full 6% of McAllen residents left McAllen for care to other markets such as Brownsville, Houston, San Antonio, Corpus Christi and Dallas! A total of $283 million in charges migrated away from McAllen, yet those costs are attributed to the population and demographics of the beneficiaries living there. As a result, the Dartmouth Atlas analysis overestimates the costs attributed to McAllen. As a comparison, $63 million of charges out-migrated from El Paso to other Texas hospitals during the same period (the all-payer analysis does not reveal out-migration to any other states; El Paso is closer to Phoenix than Dallas).
What about the important things, like quality? The March 2009 release of the Hospital Value Index™ reports McAllen’s average index score at 42.76 with El Paso’s being 43.83, just over one basis point difference. This indicates that the markets are nominally different on quality, core process measures, mortality, patient safety and patient satisfaction and experience. Shorter lengths of stay, lower costs, and lower mark-ups for charges on patient bills make for a more desirable profile of McAllen hospitals than El Paso.
In summary, the most current all-payer data (2007) simply does not support The New Yorker piece, which was partially based on 2005 Medicare data from The Dartmouth Atlas. For both McAllen and El Paso, the cost per beneficiary would decrease if the beneficiaries did not leave the market.
These markets have a great deal in common, but critical differences not discussed in The New Yorker. We are reminded how important it is to “follow the money”, yet without the anecdotes about what is going on in McAllen, the empirical data report that the hospitals in McAllen aren’t the problem.
We think that there are several important questions that arise:
Heaven help us if we do…
Hospital Inpatient Care | ||||
McAllen Residents | Cases | Patient Days | Patient Charges | Hospital Costs |
Stayed In County for Care | 85,417 | 349,215 | $2,315,742,163 | $467,429,802 |
Left County For Care | 6,069 | 53,153 | $282,687,694 | $101,905,182 |
Total | 91,486 | 402,368 | $2,598,429,858 | $569,334,984 |
McAllen Residents | Avg. Charge/Case | Avg. Charge/Day | Avg. Cost/Case | Avg. Cost/Day |
Stayed In County for Care | $27,111 | $6,631 | $5,472 | $1,339 |
Left County For Care | $46,579 | $5,318 | $16,791 | $1,917 |
All | $28,402 | $6,458 | $6,223 | $1,415 |
El Paso Residents | Cases | Patient Days | Patient Charges | Hospital Costs |
Stayed In County for Care | 74,895 | 351,704 | $2,617,700,997 | $433,484,831 |
Left County For Care | 888 | 13,748 | $63,441,348 | $20,851,930 |
Total | 75,783 | 365,452 | $2,681,142,346 | $454,336,761 |
El Paso Residents | Avg. Charge/Case | Avg. Charge/Day | Avg. Cost/Case | Avg. Cost/Day |
Stayed In County for Care | $34,952 | $7,443 | $5,788 | $1,233 |
Left County For Care | $71,443 | $4,615 | $23,482 | $1,517 |
All | $35,379 | $7,337 | $5,995 | $1,243 |
(Source: Texas Health Care Information Collection, TX Public Use Data File, State Hospital Data, Calendar Year 2007)