Geographic variation: a view from the hospital sector.

Efforts to characterize geographic variation in health care utilization and spending have focused on patterns observed with Medicare data. The authors analyzed the Healthcare Cost and Utilization Project national all-payer data for inpatient stays to assess variation in hospitalizations by age groups and, consequently, to understand how utilization of the Medicare population may differ from the population of other payers. The authors found that the correlation between inpatient discharges and costs per capita for the Medicare-eligible population over 65 and younger age groups increased from moderate to strong with age. These findings suggest examining Medicare inpatient data alone may provide a useful but not comprehensive understanding how hospital utilization and costs vary for the total population.