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FOREWORD This report presents the findings of an assessment of the reliability of information describing hospital utilization by Medicare beneficiaries and obtained as a by-product of the Medicare administrative record keeping system. The information is generated primarily frog claims submitted by hospitals to fiscal intermediaries for reimbursement purposes. The study was a logical extension of an earlier examination of the reliability of hospital utilization data compiled by private abstracting services and based on abstracts of medical records. Although the initial request for both studies stemmed from the need to identify an existing data base to serve as a baseline for evaluating the Professional Standards Review Program, the analyses were conducted with a view toward the broader purposes to which utilization data might be applied. The Medicare data and information compiled by private abstracting services constitute two of the few national data bases with potential use for a variety of health services research, policy, and administrative needs, in addition to the PSRO evaluation, provided they are sufficiently reliable. Although some information items were highly reliable, the cumulative effect of both studies elicits serious reservations about the adequacy of existing hospital utilization data on diagnoses and procedures. Accordingly, the uncritical processing of diagnostic-specific utilization information must be questioned, since increasingly important decisions regarding the adequacy of health care, the allocation of resources, and, perhaps hospital reimbursement rates may be based on these data. The deficiencies in the accuracy of currently available diagnostic and procedural utilization data in no way lessens the need for a comprehensive and reliable national health information system. The committee hopes that this report may be reviewed as one Robert J. Haggerty, M.D. Chairman, Technical Advisory Committee 1X
