February 24, 2010

Issue Brief 2: Low Consumption & Higher Medicare Cost: Consumption Clusters in a Medicare Fee-for-Service Population

The National Minority Quality Forum released the study by researchers Gary Puckrein, Ph.D., Sean D. Clearly, Ph.D., M.P.H., and Mira Shapiro, M.S. After analyzing six years of Medicare claims data for beneficiaries with diabetes the researchers found that beneficiaries who initially consumed the lowest level of services—as evidenced by the level of reimbursement associated with their care—were more likely to cost the program significantly more in the short term. Furthermore, the study identifies a cluster of five consumption group—crisis consumers, heavy consumers, moderate consumers, light consumers, and low consumers. The highest cost clusters were crisis consumers and heavy consumers. Together, they represented only 11% of Medicare beneficiaries, but 65% of all costs.