GAO: More federal spending doesn't mean better care

Spending more federal money doesn't necessarily guarantee good care, according to a Government Accountability Office (GAO) report released yesterday.

National health expenditures soared from 7 percent of gross domestic product ($308 billion) in 1970 to 16 percent ($2.2 trillion) in 2008, according to the GAO report. During the same period, the portion of the federal budget devoted to healthcare rose from 10.5 to 32.6 percent.

The GAO report encourages policymakers to support the initiatives that healthcare organizations have already taken on to improve care quality and cut costs, such as implementing checklists to reduce bloodstream infections and to coordinate care after discharge, engaging patients in their own care, and even restructuring physician compensation to be tied to outcomes.

GAO reviewed related literature and surveyed study authors about the effects of these sorts of interventions on quality and costs. Most of the respondents said such healthcare interventions did improve care, but only half reported that they affected cost savings.

There are varying reports on where to spend the dollars. For example, a study in Health Affairs last week indicated that more public spending reduces preventable deaths by 1 to 7 percent for every increase of 10 percent in local spending. However, when it comes to institution dollars, the more money that hospitals spend doesn't necessarily mean greater patient satisfaction, according to another study by Penn State researchers.

According to the GAO report, institutions were more likely to implement a particular change if it had leadership support, an amicable organizational culture, and staff resources. Interestingly enough, most respondents said financial incentives did not factor into whether they implemented a change, specifically regarding health IT.

For more:
- see the highlights summary (.pdf)
- check out the full report (.pdf)

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