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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

Interim Report
of the Committee on
Geographic Variation
in Health Care Spending
and Promotion of
High-Value Care

PRELIMINARY COMMITTEE OBSERVATIONS

Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care

Board on Health Care Services

Joseph P. Newhouse, Alan M. Garber, Robin P. Graham,
Margaret A. McCoy, Michelle Mancher, and Ashna Kibria, Editors

INSTITUTE OF MEDICINE
OF THE NATIONAL ACADEMIES

THE NATIONAL ACADEMIES PRESS

Washington, D.C.

www.nap.edu

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

THE NATIONAL ACADEMIES PRESS    500 Fifth Street, NW    Washington, DC 20001

NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance.

This study was supported by Contract No. HHSP23320042509XI between the National Academy of Sciences and the Department of Health & Human Services. Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the organizations or agencies that provided support for the project.

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International Standard Book Number 10     0-309-28282-9

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Copyright 2013 by the National Academy of Sciences. All rights reserved.

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The serpent has been a symbol of long life, healing, and knowledge among almost all cultures and religions since the beginning of recorded history. The serpent adopted as a logotype by the Institute of Medicine is a relief carving from ancient Greece, now held by the Staatliche Museen in Berlin.

Suggested citation: IOM (Institute of Medicine). 2013. Interim report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary committee observations. Washington, DC: The National Academies Press.

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

Knowing is not enough; we must apply.
Willing is not enough; we must do.

—Goethe

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INSTITITE OF MEDICINE
OF THE NATIONAL ACADEMIES

Advising the Nation. Improving Health.

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

THE NATIONAL ACADEMIES

Advisers to the Nation on Science, Engineering and Medicine

The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Ralph J. Cicerone is president of the National Academy of Sciences.

The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Dr. Charles M. Vest is president of the National Academy of Engineering.

The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Harvey V. Fineberg is president of the Institute of Medicine.

The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy’s purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles M. Vest are chair and vice chair, respectively, of the National Research Council.

www.national-academies.org

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

 

COMMITTEE ON GEOGRAPHIC VARIATION IN HEALTH CARE SPENDING AND PROMOTION OF HIGH-VALUE CARE

JOSEPH P. NEWHOUSE (Chair), John D. MacArthur Professor of Health Policy and Management, Department of Health Policy and Management, Harvard School of Public Health and Harvard Kennedy School, Boston, MA

ALAN M. GARBER (Vice-Chair), Provost, Harvard University; Mallinckrodt Professor of Health Care Policy, Harvard Medical School, Boston, MA

PETER BACH, Director of the Center for Health Policy and Outcomes, Department of Epidemiology & Biostatistics, Memorial Sloan-Kettering Cancer Center, New York, NY

JOSEPH BAKER, President, Medicare Rights Center, New York, NY

AMBER E. BARNATO, Associate Professor of Medicine, Clinical and Translational Science, and Health Policy and Management and Director of the Clinical Scientist Training Program and the Doris Duke Clinical Research Fellowship, University of Pittsburgh, PA

ROBERT BELL, Statistics Research Department, AT&T Labs-Research, Florham Park, NJ

KAREN DAVIS, Eugene and Mildred Lipitz Professor and Director, Roger C. Lipitz Center for Integrated Health Care, Department of Health Policy and Management, Johns Hopkins Bloomberg School of Public Health, Washington, DC

A. MARK FENDRICK, Professor, Departments of Internal Medicine and Health Management & Policy, University of Michigan; Director, University of Michigan Center for Value-Based Insurance Design, Ann Arbor

PAUL B. GINSBURG, President, Center for Studying Health System Change, Washington, DC

DOUGLAS HASTINGS, Chair of the Board of Directors, Epstein Becker & Green, P.C., Washington, DC

BRENT C. JAMES, Chief Quality Officer and Executive Director, Institute for Health Care Delivery Research, Intermountain Health Care, Salt Lake City, UT

KIMBERLY S. JOHNSON, Assistant Professor, Department of Medicine, Division of Geriatrics, Duke University, Durham, NC

EMMETT B. KEELER, Senior Mathematician, RAND Corporation, Santa Monica, CA

THOMAS H. LEE, Professor of Medicine, Harvard Medical School and Harvard School of Public Health; CEO, Partners Community HealthCare, Inc., Boston, MA

MARK B. MCCLELLAN, Director, Engelberg Center for Health Care Reform; Leonard D. Schaeffer Chair in Health Policy Studies, Brookings Institution, Washington, DC

SALLY C. MORTON, Professor and Chair, Department of Biostatistics, Graduate School of Public Health, University of Pittsburgh, PA

ROBERT D. REISCHAUER, Distinguished Institute Fellow and President Emeritus, The Urban Institute, Washington, DC

ALAN WEIL, Executive Director, National Academy for State Health Policy, Washington, DC

GAIL R. WILENSKY, Senior Fellow, Project HOPE, Bethesda, MD

Study Staff

ROBIN P. GRAHAM, Study Director

DIANNE WOLMAN, Senior Program Officer (through December 2010)

MARGARET A. MCCOY, Program Officer

MEG F. BARRY, Associate Program Officer (through December 2012)

MICHELLE MANCHER, Associate Program Officer

ASHNA KIBRIA, Research Associate (from July 2012)

CASSANDRA CACACE, Research Associate (October 2011 through April 2012)

REBECCA MARKSAMER, Research Associate (from February 2013)

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

NINA SURESH, Research Assistant (through August 2012)

JILLIAN LAFFREY, Assistant, Board on Health Care Services

KATERINA HORSKA, Presidential Management Fellow (December 2011 through May 2012)

MARGARET L. SCHWARZE, IOM Anniversary Fellow

SETH GLICKMAN, IOM Anniversary Fellow

ROGER HERDMAN, Director, Board on Health Care Services

Consultants

GARY ALLEN, Truven Health Analytics

ABBY ALPERT, RAND Corporation

DAVID AUERBACH, RAND Corporation

ANITA AU-YEUNG, Acumen LLC

SARAH AXEEN, Precision Health Economics

KATHERINE BAICKER, Harvard University

SEO HYON BAIK, University of Pittsburgh

JOHN BAILAR, University of Chicago (Emeritus)

ERIC BARRETTE, The Lewin Group

HANI BASHOUR, Acumen LLC

JAY BHATTACHARYA, Acumen LLC

AMITABH CHANDRA, Harvard Kennedy School of Government

MICHAEL CHERNEW, Department of Health Care Policy, Harvard Medical School

CAMILLE CHICKLIS, Acumen LLC

KENNAN CRONEN, Acumen LLC

BRYAN DOWD, University of Minnesota

EMILY EHRLICH, Truven Health Analytics

AMANDA FARR, Truven Health Analytics

ELLIOTT S. FISHER, Dartmouth Institute for Health Policy and Clinical Practice

CAROL FORHAN, Truven Health Analytics

JESSELYN FRILEY, Acumen LLC

PROJESH GHOSH, The Lewin Group

TERESA GIBSON, Department of Health Care Policy, Harvard Medical School; Truven Health Analytics

IAN GLENN, The Lewin Group

DANA GOLDMAN, Precision Health Economics

CLIFFORD GOODMAN, The Lewin Group

DANIEL GOTTLIEB, Dartmouth Institute for Health Policy and Clinical Practice

THOMAS HOERGER, RTI International

PAUL HOGAN, The Lewin Group

PETER HUCKFELDT, RAND Corporation

MARCO D. HUESCH, University of Southern California

PETER HUSSEY, RAND Corporation

JOSIE IDOKO, The Lewin Group

MELINA IMSHAUG, Truven Health Analytics

CAMERON KAPLAN, University of Pittsburgh

DARIUS LAKDAWALLA, Precision Health Economics

BRUCE LANDON, Department of Health Care Policy, Harvard Medical School; Division of Primary Care and General Internal Medicine, Department of Medicine, Beth Israel Deaconess Medical Center

MARY BETH LANDRUM, Department of Health Care Policy, Harvard Medical School

CHRISTOPHER LAU, RAND Corporation

BRANDY LIPTON, Acumen LLC

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

HANGSHENG LIU, RAND Corporation

THOMAS MACURDY, Acumen LLC

WILLARD G. MANNING, University of Chicago

JACLYN MARSHALL, The Lewin Group

MICHAEL MCKELLAR, Department of Health Care Policy, Harvard Medical School

ELLEN MEARA, Dartmouth Institute for Health Policy and Clinical Practice

ATEEV MEHROTRA, RAND Corporation

COURT MELIN, The Lewin Group

KAY MILLER, Truven Health Analytics

BRIAN MOORE, Truven Health Analytics

CAITLIN MORRIS, The Lewin Group

SIVIA NAIMER, Department of Health Care Policy, Harvard Medical School

SEBASTIAN NEGRUSA, The Lewin Group

SIMON NEUWAHL, RTI International

EDWARD C. NORTON, University of Michigan

MICHAEL K. ONG, University of California, Los Angeles

DANIELLA PERLROTH, Acumen LLC

TOMAS PHILIPSON, Precision Health Economics

BRADY POST, The Lewin Group

DANIEL ROGERS, Acumen LLC

JOHN ROMLEY, Precision Health Economics

SHAHIN SANEINEJAD, Acumen LLC

JASON SHAFRIN, Acumen LLC

VICTORIA SHIER, RAND Corporation

ELEN SHRESTHA, Acumen LLC

JONATHAN SKINNER, Dartmouth Institute for Health Policy and Clinical Practice

MARK TOTTEN, RAND Corporation

JASON WAHLMAN, The Lewin Group

NANCY WALCZAK, The Lewin Group

JOHN WARNER, The Lewin Group

ADAM S. WILK, University of Michigan

BENJAMIN YARNOFF, RTI International

SAJID ZAIDI, Acumen LLC

YUTING ZHANG, University of Pittsburgh

WEIPING ZHOU, Dartmouth Institute for Health Policy and Clinical Practice

Page viii Cite
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

 

REVIEWERS

This report has been reviewed in draft form by individuals chosen for their diverse perspectives and technical expertise, in accordance with procedures approved by the National Research Council’s Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published report as sound as possible and to ensure that the report meets institutional standards for objectivity, evidence, and responsiveness to the study charge. The review comments and draft manuscript remain confidential to protect the integrity of the deliberative process. We wish to thank the following individuals for their review of this report:

HENRY AARON, Brookings Institution

STUART ALTMAN, Brandeis University

GERARD F. ANDERSON, Johns Hopkins University

DAVID A. ASCH, Professor of Medicine and Health Care Management; Executive Director, Penn Medicine Center for Innovation, University of Pennsylvania

DAVID BLUMENTHAL, The Commonwealth Fund

ELLIOT FISHER, Dartmouth Institute of Health Policy and Clinical Practice

ELIZABETH A. MCGLYNN, Kaiser Permanente

MARILYN MOON, American Institutes for Research

ROBERT PHILLIPS, American Academy of Family Physicians

JOHN ROTHER, National Coalition on Health Care

ALAN M. ZASLAVSKY, Harvard Medical School

STEVE ZUCKERMAN, The Urban Institute

Although the reviewers listed above have provided many constructive comments and suggestions, they were not asked to endorse the observations nor did they see the final draft of the report before its release. The review of this report was overseen by DONALD M. STEINWACHS, Johns Hopkins Institute for Policy Studies, and CHARLES E. PHELPS, University of Rochester (Emeritus). Appointed by the National Research Council and Institute of Medicine, they were responsible for making certain that an independent examination of this report was carried out in accordance with institutional procedures and that all review comments were carefully considered. Responsibility for the final content of this report rests entirely with the authoring committee and the institution.

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

This page is blank

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

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Page xiii Cite
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

BOXES, FIGURES, AND TABLES

Boxes

1          Commissioned Analyses

2          Definitions of Geographic Units Frequently Used in Health Services Research

Figures

1          Map of the United States with hospital referral region boundaries

2          Top 20 percent of hospital referral regions and hospital service areas in drug spending

3          Bottom 20 percent of hospital referral regions and hospital service areas in drug spending

4          Variation in price- and risk-adjusted Medicare spending for stroke in a hospital referral region

5          Variation in price- and risk-adjusted Medicare spending for hip fracture in a hospital referral region

6          Variation in price- and risk-adjusted Medicare spending for heart attack in a hospital referral region

7          Use of upper GI endoscopy among gastroenterologists treating gastroesophageal reflux disease

8          Number of beneficiaries in HRRs categorized into 22 bins of monthly per capita spending, with input-price adjustment alone (top) and with input price adjustment, plus age, sex, and healthstatus adjustment (bottom)

9          Growth rates of spending among quintiles of HRRs based on expenditure levels in 1992

10a-h   Medicare service category utilization (monthly cost residual) by HRR

11        Variation in total all-services per capita Medicare spending explained by categories of post-acute care spending and all other spending (2007-2009)

Tables

1          Pearson Correlation Coefficients for Medicare Beneficiary Utilization (Risk-Adjusted Per-Member-Per-Month Cost) Across Cohorts

2          90th:10th Percentile Ratios of Input-Price-Adjusted Spending Across Payers, When Adjusted for Selected Predictors

3          Pearson Correlations of Condition-Specific Medicare Quality and Condition-Specific Utilization

4          Reduction in Variation in Post-Acute Care Spending and Total, All-Service Medicare Spending from Holding Each Component of Post-Acute Care at Its National Mean

5          Wide Variation in Spending for Durable Medical Equipment and Home Health in Contiguous Florida Countries

Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×

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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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PageR6
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
PageR7
Page viii Cite
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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PageR8
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
PageR9
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
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PageR10
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
PageR11
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
PageR12
Page xiii Cite
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
PageR13
Suggested Citation:"Front Matter." Institute of Medicine. 2013. Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Care: Preliminary Committee Observations. Washington, DC: The National Academies Press. doi: 10.17226/18308.
×
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Interim Report of the Committee on Geographic Variation in Health Care Spending and Promotion of High-Value Health Care: Preliminary Committee Observations is designed to provide the committee's preliminary observations for the 113th Congress as it considers further Medicare reform. This report contains only key preliminary observations related primarily to the committee's commissioned analyses of Medicare Parts A (Hospital Insurance program), B (Supplementary Medical Insurance program) and D (outpatient prescription drug benefit), complemented by other empirical investigations. It does not contain any observations related to the committee's commissioned analyses of the commercial insurer population, Medicare Advantage, or Medicaid, which will be presented in the committee's final report after completion of quality-control activities.

This interim report excludes conclusions or recommendations related to the committee's consideration of the geographic value index or other payment reforms designed to promote highvalue care. Additional analyses are forthcoming, which will influence the committee's deliberations. These analyses include an exploration of how Medicare Part C (Medicare Advantage) and commercial spending, utilization, and quality vary compared with, and possibly are influenced by, Medicare Parts A and B spending, utilization, and quality. The committee also is assessing potential biases that may be inherent to Medicare and commercial claims-based measures of health status. Based on this new evidence and continued review of the literature, the committee will confirm the accuracy of the observations presented in this interim report and develop final conclusions and recommendations, which will be published in the committee's final report.

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