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Kathleen Sebelius, the secretary of health and human services, requested the Medicare study.
The report's authors, who include prominent health policy experts, doctors and consumer advocates, were responding to the argument that Medicare should pay higher levels of reimbursement to areas of the country that deliver measurably good care at low cost and less to regions where costs are high and outcomes are poor.
"Areas don't make decisions; doctors, hospitals and delivery systems make decisions," said Joseph P. Newhouse, a health policy professor at the Harvard School of Public Health who is chairman of the committee. Incentives, he said, are more appropriately aimed at the providers responsible for care.
The study was conducted at the request of the secretary of health and human services, Kathleen Sebelius, in response to a push by some members of Congress to revisit how Medicare pays hospitals and doctors.
Influential researchers at Dartmouth have long identified significant variations in health spending across the country, outlined in a document known as the Dartmouth Atlas. It has prompted a debate in the world of health care over whether the current Medicare payment system does too little to reward hospitals and doctors in states like Minnesota and Iowa, which have been able to hold medical spending down while still delivering good levels of care.
Congress has been considering proposals that would shift tens of billions of dollars of Medicare money away from doctors and hospitals in high-cost areas, like New York and Florida, to lower-cost regions.
As Medicare tries to find ways of moving beyond the current fee-for-service system, in which doctors and hospitals benefit by offering a high volume of services, there has been considerable debate over whether rewarding health systems based on their geography would be one way to encourage efficiency.
Three years ago, House members from states seen as low cost formed a quality-care coalition to help push for changes to Medicare payments.
"Continuing to pay health care providers for bad outcomes — while punishing states like Minnesota where doctors provide high-quality, low-cost care — does nothing to address Medicare's solvency," said Representative Betty McCollum, Democrat of Minnesota, one of the Congressional leaders of the coalition, in a statement responding to the report. "Congress needs to demand comprehensive, value-based payment reforms."
Michael Richards, executive director of external affairs at Gundersen Health Systems, a member of the coalition, concurred, saying: "The report confirms there is a wide variation in Medicare spending across the country. The current fee-for-service system rewards high utilization of Medicare services." But the authors of the interim report found that there was too much variation within a region to justify a payment policy aimed at all the hospitals and doctors within the area. Just as there were efficient providers in high-cost areas, there were inefficient ones in low-cost areas.
"There's just a huge amount of difference," said Dr. Peter B. Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan-Kettering Cancer Center in New York, who is also a member of the committee. "All you're seeing is a map with averages."
But Mr. Newhouse said existing programs that reward individual hospitals and doctors for better or more efficient care made more sense than a regional approach. "If one were to target at the delivery system level, that would benefit the high-value regions," he said.
Federal officials are reviewing the study, according to a spokeswoman. The final report, which will include explicit recommendations, is expected this summer.
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