Unwarranted variation in healthcare refers to differences in medical practice that cannot be explained by illness, need, or evidence. There are three main drivers of unwarranted variation: effective care, preference-sensitive care, and supply-sensitive care. Shared decision making has the potential to help reduce unwarranted variation related to preference-sensitive care by increasing patient education and involvement in healthcare decisions. Aligning financial incentives through payment models like accountable care organizations could also help by rewarding quality over quantity of services. Improving outcomes research and data sharing between providers may further address unwarranted variation by helping providers determine effective, necessary care based on evidence from different institutions and settings.

1. Soraya Ghebleh
Unwarranted Variation in Healthcare
Unwarranted variation refers to differences in the practice of medicine that
cannot be explained by illness, medical need, or evidence-based medicine. The three
areas of care that cause unwarranted variation are effective care, preference-
sensitive care, and supply-sensitive care. Effective care is defined as interventions
for which benefits far outweigh the risks and the right rate of treatment is for every
patient that meets clinical guidelines to be in need. Preference-sensitive care is
when given two equally viable treatment options; the patient must make a decision
about their treatment and the correct rate of use should depend on patient choice.
Supply-sensitive care refers to capacity determining the amount of treatment a
patient receives rather than whether the treatment is necessary for a better patient
outcome. Regions with higher use, however, do not demonstrate better outcomes
overall. Unwarranted variation is one of the drivers of excessive waste in the
healthcare system and contributes to wide differences in the quality of care and
disparities in health outcomes across clinical settings. The problems associated with
unwarranted variation have been expounded on but the next step is proposing
solutions to create a better, more efficient healthcare system that is consistent
regardless of geographical location and setting.
One potential remedy that can help reduce unwarranted variation is
widespread introduction of shared-decision making (SDM). Shared-decision making
addresses problems associated with preference sensitive care. When a patient is
given two treatment options, for example having a hip replacement compared to
managing pain without surgery, they must make a decision. In many cases patient
decisions are influenced by professional opinion and trust in physician choices. The
lifestyle of the patient and what is important to the patient is not always taken into
consideration when making these preference-sensitive decisions about healthcare
choices. SDM can address this by providing the means for patients to truly
understand the implications of decisions about healthcare by increasing patient
education, involving the patient in the decision, and helping patients ask the right
questions about how to proceed with their care. Potential barriers to
implementation are resource-constraints for proper implementation and having
physician buy-in to the notion that patients should have decisions regarding their
care that they may not agree with.
Another strategy for reducing unwarranted variation involves re-aligning
financial incentives with value-based care. Under the current fee-for-service model,
physicians are rewarded for providing volume-based care. This is one of the drivers

2. of supply-sensitive care. Many clinical settings have a high capacity to deliver care
and as long as providers are reimbursed for quantity rather than quality, they will
continue to deliver services that often go beyond the scope of necessary care.
Introducing new payment models like accountable care organizations and bundled
payments have the potential to reduce utilization just because supply is available
and encourage providing care that is based on actual need. There are many
challenges in introducing new payment models to the current healthcare system.
Provider behavior is difficult to change and the prevailing attitude that “more is
better” will require a paradigm shift in how providers and often patients define
quality care. Re-organization of healthcare systems is also difficult and whenever
changes are introduced, criticism and backlash is expected.
A third way of reducing unwarranted variation is improving health outcomes
research and disseminating information accordingly to providers. Many providers
are unaware that their outcomes differ from other providers, even within their own
clinical institutions. The development of strong, evidence-based outcomes data is
essential in determining what is effective and necessary care. This can help address
supply-sensitive care.If evidence exists that demonstrates to providers that how
they provide care can be improved on in a systematic fashion, this can be an
important tool in creating a more consistent healthcare system. National registries
can assist in assessing the outcomes in different clinical institutions. Simply sharing
data to improve the quality of care delivered and provide a basis in evidence can
help providers be aware that there are differences and begin to understand why
certain providers or clinical settings may produce better outcomes as compared to
other providers or clinical settings. This may be one of the more difficult areas to
address because physicians value their clinical autonomy and do not want to be held
comparable to their colleagues around the nation. Many institutions do not
necessarily want to see how they compare to other institutions in terms of both
resource utilization and expenditure. These three potential remedies provide
opportunity to reduce unwarranted variation, especially if implemented
simultaneously.