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VOLUME 53 | NUMBER 2 | APRIL 2018


Persistent Variation in Medicare Payment Authorization for Home Hemodialysis Treatments

Objective: To analyze variation in medical care use attributable to Medicare's decentralized claims adjudication process as exemplified in home hemodialysis (HHD) therapy.

Data Sources/Study Setting: Secondary data analysis using 2009–2012 paid Medicare claims for HHD and incenter hemodialysis (IHD).

Study Design: We compared variation across Medicare administrative contractors (MACs) in predicted paid treatments per standardized patientmonth for HHD and IHD patients. We used ordinary leastsquares regression to determine whether higher paid HHD treatment counts expanded HHD programs’ presence among dialysis facilities.

Data Collection: We identified HHD and IHD treatments using procedure, revenue center, and claim condition codes on type 72x claims.

Principal Findings: MACs varied persistently in predicted HHD treatments per patientmonth, ranging from 14.3 to 21.9 treatments versus 10.9 to 12.4 IHD treatments. The presence of facilities’ HHD programs was uncorrelated with average HHD payment counts.

Conclusions: Medicare's claims adjudication process promotes variation in medical care use, as we observe among HHD patients. MACs’ discretionary decision making, while potentially facilitating innovation, may admit inefficiency in care practice as well as inequitable access to health care services. Regulators should weigh the benefits of flexibility in local coverage decisions against those of national standards for medical necessity.

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