Estimating non-VA Health Care Costs

1. Estimating non-VA Health Care Costs Todd H. Wagner

2. Learning Objectives • After this talk, you will • Understand whether you need non-VA data • Know the strengths and weaknesses for different sources of non-VA data HERC

3. Do you need non-VA data? • Many veterans have a choice in where they get care • Many veterans who get care from VA facilities also get care from non-VA providers (e.g., Medicare, Medicaid) • Perspective and objectives: these should dictate your data needs HERC

4. Example • Any examples of studies that require non-VA data? HERC

5. Sources of non-VA data • Medicare data • Fee Basis • Bills from providers • Self-report • All sources have strengths and weaknesses HERC

6. Medicare Data

7. Medicare Data for Veterans • Medicare is health insurance for people over age 65 or those with a disability • VIReC maintains • Medicare Data for all VA enrollees from 1999 through 2003 • Note the delay; this may be critical for clinical trials. HERC

8. Medicare Institutional Claims • AKA Part A (except outpatient) • Inpatient (short/long) • Outpatient (Part B) • Home Health (Part A & B) • Hospice • Skilled Nursing Facilities • One file for each type of claim HERC

9. Medicare Non-Institutional Claims • AKA Part B: • Physician/supplier file • Physician, NPs, and other professionals • Clinical Laboratories • Ambulance services • Ambulatory Surgery Centers • Durable Medical Equipment (DME) file HERC

10. Medicare File Types • Research Identifiable Files (RIFs) • Beneficiary Encrypted Files (BEFs) • Limited Data Set (LDS) • Downloadable files (PUFs) HERC

11. Charges in Medicare Data • Charges: reflect billed amount. • Charges > Costs. • Adjust charges using cost-to-charge ratio (CCR). • Cost to charge ratio is calculated from Medicare Hospital Cost Report HERC

12. Medicare Payments • Payments: reflect amount paid by Medicare. This reflects: • Co-payments, deductibles, coinsurance • Benefit limitations • Wages, disproportionate share, IME • Direct medical education • Outlier payment • Reimbursement Amount = DRG Price + Outlier Payment – Individual Payment – Other Insurance Payment HERC

13. Fee Basis

14. Overview of Fee Basis Program • Pays for care at non-VA facilities when • it is the only source available, or • VA could save money • Full range of services covered • Mostly pre-arranged; limited emergent care HERC

15. Fee Basis files • Subset of all VA contract care • Non-VA PTF has detail on hospital stays; some overlap with Fee Basis files • Substantial utilization unaccounted for • SAS format at Austin HERC

16. Highlights of Financial Data • Amount claimed • Amount paid • often much less than amount claimed • Many variables relating to FMS record-keeping: invoice date, processing date, check number, check date, cancel code, etc. HERC

17. User Notes • Each paid invoice has a separate record. • Invoices may be sent LONG after services are rendered • Search for records in many years HERC

18. Using Fee Basis Files: Cautions • Beware of missing decimal places • ICD diagnosis codes • Payment amounts • Care in community nursing homes, state veterans homes, and some non-VA hospitals may also be recorded in other files • e.g., contract nursing home care appears in DSS outpatient files HERC

19. Bills from Providers

20. Collecting Billing Data • With consent, you can attempt to collect hospital bills • We are doing this for a few clinical trials • Mixed success; typically only done for inpatient costs HERC

21. Method • Use self-report to identify utilization • Ask patient for name of hospital and approximate date • Have patient sign HIPAA release • Contact hospital for UB92 • Cost adjust the charges reported on the bill HERC

22. Self-Report

23. Limits with Administrative Data • Obtaining and analyzing claims data can be costly and time consuming • Administrative data can be incomplete or inaccurate • Limited benefits • Out-of-plan or out-of-pocket utilization • Capitated health plans HERC

24. What is Self Report? • Cognitive process of recalling information • Ample opportunity for distortion and error (Khilstrom et. al 2000) • Self-report not valid when people lack the cognitive capabilities HERC

25. Modifiable Components • Recall timeframe • Type of utilization • Utilization frequency • Questionnaire design • Mode of data collection HERC

26. Questionnaire Design • No standards exist • Pretest: Dillman (2000) • Use counts for responses (not categories) HERC

27. Self-Reported Costs • Self-reported costs are assumed poor • Imputing costs from self-reported utilization can introduce biases HERC

28. Additional Readings • Fee Basis Technical Report #18 • Bhandari and Wagner. Self-Reported Utilization of Health Care Services: Improving Measurement and Accuracy (2006, MCRR). Available upon request. HERC

29. Additional Links • VIReC– Manages the VA Medicare Data www.virec.research.med.va.gov • ResDAC (Research Data Assistance Center) for Medicare data www.resdac.umn.edu • Medicare and Medicaid www.cms.hhs.gov HERC

30. Additional Viewings • 2005 HERC Courses • Talk on Medicare Data (Yu) • Talk on the Fee Basis (Smith) http://www.herc.research.med.va.gov/resources/training_course_archives.asp HERC