What About Hospital Patient Care Costs?

04/09/2013

About five years ago, a “think tank” and university published total Medicare costs per beneficiary in different regions of the country. They stated Texas had some of the highest health care costs in the nation. I contacted the people who conducted the study, reviewed their raw data and extracted only acute care hospital expenses. My analysis revealed acute care hospital costs in North Texas were lower than the national average. Other health care expenditures like medical durable equipment and home health care were driving the higher costs per Medicare beneficiary in this region.

In a state-by-state health care cost comparison in the April 9 edition of The Wall Street Journal, Texas ranked very low in hospital care costs. The 2009 spending per capita costs compiled from Medicare, Medicaid and census data reflected Texas hospital costs below the national average. Hospital care encompassed spending for services provided in hospitals, including outpatient care, operating room fees and services of resident physicians. Texas hospital care costs were lower than Delaware, Maine, Massachusetts, Missouri, North Dakota, South Dakota, Vermont, West Virginia and Washington, D.C.

This article validates my calculations from five years ago. It clearly shows Texas hospitals cost much less than other hospitals throughout the nation, even with a 28 percent uninsured population and one of the highest obesity rates in the nation. North Texas hospitals work conscientiously to reduce operating costs while delivering efficient health care. Obviously, we can strive to reduce patient care expenses even more, but we want to balance effective patient clinical outcomes and satisfactions.

Reimbursement reductions to hospital providers in the U.S. since 2010 have totaled $250 billion. President Barack Obama’s proposed budget tomorrow will likely include $200 billion of cuts to providers, not beneficiaries. Hospitals want to be part of the solution. We have given our fair share, but we cannot afford to reduce reimbursement in the coming months as operating margins and capital equipment investments have already been greatly reduced. North Texas hospital statistics clearly reflect we are focused on keeping hospital care costs below the national average and want to continue that trend as we bend the cost curve.