Minnesota's medical costs rose in 2014 but varied widely clinic to clinic

The total cost of medical care varies dramatically across Minnesota — from $823 per month for patients who receive their primary care at the Mayo Clinic to just $381 at a pair of suburban Twin Cities medical groups.

The average medical bill was somewhere in between: $449 per month for the average privately insured patient, according to the second annual Total Cost of Care report, released Thursday by MN Community Measurement.

The report also found that improving quality and patient satisfaction apparently has come at a price: A 3 percent increase from 2013 to 2014 in the cost of patient care.

While unmasking high-cost providers might motivate them to change, the main goal is to learn from providers that bucked the trend and lowered costs, said Jim Chase, president of Community Measurement, a nonprofit agency, which based the data on claims paid by Minnesota's four largest health insurers.

"It isn't just to identify who is high and low," Chase said. "Its about the trend over time … and what's working for different organizations."

Hennepin County Medical Center (HCMC) saw spending on its privately insured primary-care patients decline 4 percent. Leaders there cited a variety of efforts to divert patients, when appropriate, to lower levels of care — such as urgent care instead of the emergency room — and to investments in care coordinators and social workers who help patients stay healthy at home. HCMC clinics even have a food bank and provide needy patients with fresh groceries.

As a result, primary-care costs for HCMC rose slightly, but inpatient hospital costs dropped, said Nancy Garrett, HCMC's chief analytics officer. "That's exactly what we're trying to do, is get patients into lower-cost settings."

The high-cost data have become an irritant to Mayo, because they seem to contradict its reputation for efficient, team-based care.

Even though the figures are weighted to account for medical groups with sicker patients, Mayo officials believe they are tilted against the so-called destination medical center. Patients assigned to Mayo for primary care were five times more likely than others to be "outliers" whose annual costs surpassed $100,000, said Dr. Paula Santrach, Mayo's chief quality officer.

Patients are assigned to medical groups for the Community Measurement analysis based on insurance claims showing where they received the most primary care in a given year. But the cost figures include care they also received from other providers.

Community Measurement also publishes ratings on patient satisfaction and quality of care. Improving one without sacrificing another can be tricky. Scenic Rivers Health Services in Cook, Minn., was lauded three weeks ago for increased staffing and an online Web portal that boosted its patient satisfaction scores between 2012 to 2014. But its monthly per-patient cost of care rose from $491 in 2013 to $523 in 2014.

Even if providers contest the data, there is little doubt that the publicity has an impact. The share of clinics providing optimal diabetes care rose from 17 percent in 2008 to nearly 40 percent now.

Even Mayo saw a dip in medical spending on its primary-care patients.

"We know we need to become more affordable," Santrach said, "and we're doing lots of work on redesigning how we care for patients."

Jeremy Olson • 612-673-7744