A new study suggests that Medicare could save over $4 billion annually by cutting back on 47 low-value services that offer minimal clinical benefit and, in some cases, may pose harm to patients.

The cross-sectional analysis, published in JAMA Network Open, reviewed Medicare fee-for-service claims from 2018 to 2020, examining data from 3.7 million beneficiaries aged 65 and older. Researchers estimated that $3.6 billion was spent annually by Medicare on these low-value services, with beneficiaries shouldering an additional $800 million in out-of-pocket costs.

Twenty services accounted for 95% of the total annual spending. Among these, five received “grade D” recommendations from the U.S. Preventive Services Task Force—indicating moderate or high certainty that the service has no net benefit or that harms outweigh benefits. These five services, including screening for chronic obstructive pulmonary disease and bacteriuria, made up 59% of total spending on low-value care.
Low-value imaging services also drove a significant portion of volume. Imaging for conditions such as plantar fasciitis, syncope, headache, and low back pain were among the most commonly performed despite limited evidence of benefit in these contexts.

"Eliminating Medicare payments for five USPSTF grade D services could save approximately $2.6 billion annually," the authors noted, pointing to Section 4105 of the Affordable Care Act, which gives the Department of Health and Human Services authority to deny payment for services lacking adequate clinical evidence.

Researchers acknowledged that fully realizing these savings may be complicated by coding practices and the potential substitution of other services. However, they argue that targeting low-value care could free up resources for higher-value interventions without jeopardizing patient outcomes.

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