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Regional Variations Seen in Radical Prostatectomy Cost

Controlling for known total cost determinants does not completely explain wide differences

THURSDAY, April 8 (HealthDay News) -- Even after adjustment for medical case mix, local wages and other factors, there are wide variations from state to state in the total cost of radical prostatectomy, suggesting that inefficiencies exist in the health care market, according to research published in the April issue of The Journal of Urology.

Danil V. Makarov, M.D., of the Yale University School of Medicine in New Haven, Conn., and colleagues analyzed data from the 2004 Healthcare Cost and Utilization Project National Inpatient Sample on 9,917 patients aged 40 and older who underwent radical prostatectomy without cystectomy. They examined state-level variation in costs, controlling for the local area wage index, case mix, patient demographics, and hospital characteristics.

The researchers found that the mean unadjusted cost of radical prostatectomy was $9,112, and identified Washington (which had an unadjusted mean cost of $8,093) as the median state. In other states, they found that the unadjusted mean cost ranged from $12,490 in California to $4,650 in Utah. The researchers' adjusted analysis showed that Colorado and New Jersey had the highest and lowest total costs ($10,750 and $5,899, respectively). They found that regional variation accounted for the greatest incremental proportion of the variance (35.1 percent) and that case mix variables accounted for an incremental 32.3 percent.

"Controlling for known total cost determinants did not completely explain these differences but altered ordinal cost relationships among states," the authors write. "Cost variation suggests inefficiencies in the health care market. Additional studies are needed to determine whether these variations in total cost translate into differences in quality or outcome and how they may be translated into useful policy measures."

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