Huge Differences by Region in Prescribing to Elderly, Study Finds

Researchers find that a higher proportion of seniors are prescribed antidepressants, dementia drugs and other medications in some parts of the country than others.

Elderly Americans are prescribed medications in inexplicably different ways depending on where they live, according to a new report from Dartmouth researchers.

The most depressed older patients—or at least the ones being medicated -- live in parts of Louisiana and Florida. There’s a cluster with dementia around Miami. And the seniors who have the most trouble sleeping? They live, perhaps unsurprisingly, in Manhattan.

The study by the Dartmouth Institute for Health Policy and Clinical Practice examined geographic variations in the drugs elderly Medicare patients received in 2010.
Researchers mapped where patients got medications they clearly needed and where they got drugs deemed risky for the elderly. They also looked at differences in the use of so-called discretionary drugs, which they say are widely prescribed but of uncertain benefits.

The report’s findings underscore those of a ProPublica investigation in May, which found that some doctors who treat Medicare patients often prescribe drugs that are dangerous or inappropriate for certain patients. ProPublica also found that the federal officials who run Medicare have done little to scrutinize prescribing patterns in their drug program, known as Part D, or question doctors whose practices differ from their peers.

Officials from the Centers for Medicare and Medicaid Services could not be reached to answer questions about the study. They have previously said that the primary responsibility for overseeing prescribing belongs to private insurers that administer the program. Still, they have acknowledged that Medicare should and will do more to track prescribing in Part D and follow up on unusual patterns.

The Dartmouth researchers did not look at the habits of individual doctors, as ProPublica did, but instead looked at the percent of patients in each region who received certain types of medications. Regionals boundaries were based on where patients would be referred for hospital care.

For example, 17 percent of elderly patients in Miami received a prescription for a dementia drug in 2010, while less than 4 percent of patients in Rochester, Minn., and Grand Junction, Colo., got one. Nationally, the average was 7 percent, according to the report, titled the Dartmouth Atlas of Medicare Prescription Drug Use.

There were similar differences by location for antidepressants. In Miami, almost one-third of elderly Medicare enrollees received at least one prescription for such drugs and about one-quarter of those in a swath of Louisiana did. In Honolulu, just 7 percent got one.

The report does not address whether the patients had diagnoses that would warrant the use of these medications. It also does not include disabled patients under 65 who are also covered by Part D.

Researchers examined whether patients in different regions had been given widely accepted drug treatments following health emergencies, for instance a beta blocker after a heart attack or an osteoporosis drug after certain fractures.  And they calculated the percentage of seniors who were given drugs labeled risky by the American Geriatrics Society because they are known to affect their cognition and balance.

“We see that some clinicians are not achieving a level of effective medication use” compared to their peers, said Dr. Nancy Morden, a lead author of the report. “Conversely, some clinicians are putting their patients at much higher risk by using hazardous medications at a much higher rate than their peers.”

The report does not tackle two of the most fraught issues in prescribing today: the use of narcotic painkillers and anti-psychotics, especially to treat dementia in the elderly.

Morden said she was surprised to find that, in some regions, large percentages of patients were getting discretionary drugs that were moderately beneficial, like those for acid reflux -- and not getting the ones that could save their lives, like the beta blockers or cholesterol-lowering drugs.

 “What are we doing?” she said. “It’s surprising to me that we can use so much of our energy to pursue medications that give us far less in terms of health. I worry that it’s coming at the cost of getting the effective medications.”

People in some regions of the country are healthier than in others. But Morden said that does not explain the wide variations her group found in so many different categories of drugs. That may be a signal that patients are not being adequately informed about the risks, benefits and costs of the drugs, she said. Doctors also may be unaware of how different their practices are from the peers in other parts of the country.

Overall, researchers found that the elderly in Miami fill more prescriptions than anywhere else. On average Miami area patients got nearly 63 per person, including refills, in 2010, compared to a national average of 49. Seniors in Miami also had the highest average spending on prescriptions that year, $4,738 compared to $2,670 nationally.

In the report, Morden and her co-authors encourage policymakers to seek ways of reducing geographic variation in the way medications are prescribed. They also urge patients to ask their doctors about whether a drug is truly needed for them.

The Dartmouth group has previously examined how costs and use of services in the Medicare program differ markedly across the country. They note that some of the highest-spending regions in terms of drug costs were also among the highest users of other types of medical services.



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Should the RBI be made more accountable? —Part1

The time is now ripe to make the RBI more accountable to the people of India. With its wide ranging powers and greater impact on all aspects of the economy, the accountability of RBI assumes even greater importance and should not be ignored.

When I was growing up in the 1960s/1970s, the RBI governor could perhaps walk down the main street of any Indian metropolis unnoticed. That is not the case today. In India as well as many other countries, these unelected officials are so much in the media glare. In fact, their actions and words are the subject of much heated debate in newspapers, TV channels and the like. Thus, there is no escaping the fact that from being ‘behind the scene actors’, central banks have now been forced to assume very public (multi-faceted) roles —ranging from setting monetary policy to supervision of financial institutions and the like. Through their participation in the Basel framework, many central banks are involved in establishing global standards for the regulation of the banking sector as well. Thus, they are therefore legitimately seen as the primary guardians of the integrity of the global financial system in a general sense, especially at this time of global economic crisis.


Indeed, the continuing global economic and financial crises has pushed central bank further to the forefront simultaneously as originators of the crisis and as well as potential saviours (of their countries) from these. Many central banks have in fact admitted at least partially, if not completely, responsibility for the circumstances resulting in the current set of international economic and financial problems. They have also promised to do better. As Ben Bernanke, chairman of the Board of Governors of the Federal Reserve, is said to have told Congress in 2009, “There were mistakes made all around. … We should have done more [in banking supervision]. We should have required more capital, more liquidity. We should have required tougher risk management controls.”i


Thus, without any doubt, the world over, central banks have engaged a greater variety of tasks than what they were originally established for. They are also handling very large sums of public money. While the increased role for central banks is perhaps here to stay, this added responsibility has naturally fuelled the demand for enhanced transparency and greater accountability on their part. That being the case, several legitimate questions arise regarding the accountability of central banks and transparency of their operations:

a) To whom should central banks be accountable?

b) What is expected of central banks in the name of this accountability and transparency?

c) How transparent should that accountability be to the media and to the larger public?


These questions are equally relevant to India’s central bank —Reserve Bank of India (RBI). We specifically explore, in a series of articles, how accountable and transparent the RBI has been. However, before looking into the above questions, let us first look at RBI’s mandate, which is rarely well understood!


A reading of the preamble to the RBI Act, 1934 describes its main functions as follows:

" regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage."ii

Likewise, other Acts provide additional mandates and the various core and additional functionsiii performed by the RBI are summarised in Table 1 below


Table 1: Functions and Mandates of The Reserve Bank of India

Functions of RBI

Legal Basis for

Performing Function

Classification of Function

Issuing of currency


Core Function

Acting as Monetary Authority


Core Function

Regulation of NBFCs


Additional Function

Management of Foreign Exchange Reserves


Additional Function

Management of Sovereign Debt (Central government)

By Statute

Additional Function

Management of Sovereign Debt (State governments)

By Agreement

Additional Function

Regulation of forex, money and government securities markets and their derivatives

Mandates from Various Sources

Additional Function

Regulation and Supervision of Commercial Banks and Cooperative Banks

The Banking Regulation Act, 1949

Additional Function

Regulating the Foreign Exchange Market   

The Foreign Exchange Management Act, 1999

Additional Function

Regulation and supervision of the payment and settlement systems

The Payment & Settlement Systems Act, 2007

Additional Function


As can be seen from the above, the RBI is therefore, what one would call as a “complete full service” central bank as it:

a) Is the issuer of currency;

b) Is the monetary authority;

c) Regulates and supervises banks, non-bank financial companies and other critical segments of financial markets in India;

d) Is the banker and debt manager to the government;

e) Acts as the gate keeper of the external sector; and

f) It regulates and supervises the payment and settlement system among other things.


Further, because the RBI is the monetary authority and it is also empowered to act as the banking sector regulator, the primary responsibility for financial stability also lies with RBI.


This is not all.


In reality, RBI’s statutory mandate is, perhaps, much broader compared to many of the other full service central banks because, historically, the RBI has played a key role in the overall development agenda of India. Innovations like credit to the agriculture sector and MSMEs (micro, small and medium enterprises), the lead bank scheme, the various priority sector categories, targets and associated lending, the fairly recent emphasis on financial inclusion and financial literacy have all flowed from this development role of RBI. In fact, the huge development finance institutions (DFIs) that exist (in India) today—such as, NABARD and IDBI—are, strictly speaking, offshoots of the RBI. The RBI has done much more than a typical full service central bank. And with the advent of the global financial crisis, RBI’s role has only increased further!


Given the above discussion, one is tempted to ask: how accountable has the RBI been and how transparent are its operations?


Indeed, I was surprised to find that there is no formal mechanism of accountability enshrined in the RBI Act and I quote Dr Subbarao, former governor, RBI who argued that:


“Neither the RBI Act nor any rules lay down a formal accountability mechanism. In the absence of a specific formulation, the fallback is on the general principle underlying a democracy—which is to render accountability to the parliament through the Finance Minister. The Reserve Bank assists the Finance Minister in answering parliament questions that pertain to its domain. Besides, the Standing Committee on Finance of Parliament summons the Governor for testimony on specific issues including legislations under consideration.”iv


And surely, this lack of this accountability and transparency seems to be showing on the ground as highlighted by the spate of recent (not-so-transparent) incidents involving the RBI:


First, was the case of Mr KM Birla, who initially did not resign from the RBI board despite his group company having applied for a banking license. In fact, RBI’s handling of this conflict of interest matter was very indecisive (referring it to the Union Government) until Mr Birla was forced to resign because apparently a member of the Parliamentary Standing Committee on Finance (PSCF) objected. It is entirely another matter that Mr Birla has recently been named in the CBI first information report (FIR) in the coal scam. A person like Mr KM Birla, whose companies had a strong commercial interest in financial services through the Aditya Birla group companies, was allowed to serve on the RBI board (uninterrupted) for many years suggests that he could have perhaps even lobbied for the entry of large business industrial houses into banking. The results are there for everyone to see as when the RBI called for banking licenses in 2013, they strangely permitted the entry of large industrial business groups into banking, a practice hitherto avoided in several countries globally. This, in fact, vitiates the entire bank licensing process in a significant manner.


Second, as the Mint writes and I quote, “Two months after the deadline for applications for new banks expired, there have been two changes in the list of applicants. One, Value Industries Ltd, a unit of Videocon Industries Ltd, has withdrawn its application for a banking permit, and two, Chandigarh-based real estate and hospitality company KC Land and Finance Ltd has sought a banking licence. The original list of 26 permit seekers, released by RBI on 1 July, did not have this name. Many are finding the sudden appearance of a new applicant and withdrawal of the Videocon group mysterious.” Whatever be the reasons, I am not sure that the above represents the procedural transparency required of institutions like the RBI.


Third, when the Hon Parliamentary Standing Committee on Finance (PSCF) was seized of the bank licensing matter, RBI’s hurried decision to grant banking licenses cannot be rationalised at all. In my humble opinion, irrespective of whatever the RBI says, this action by the RBI (alone) carries huge implications because it shows utter disrespect for parliamentary democracy. 


Fourth, the banking selection advisory panel has significant conflicts of interests and many weaknesses as enumerated in Moneylife articles. It should also be noted that the Banking Selection Advisory Panel includes several past regulators, who, in my humble opinion, will not be able to dispassionately and objectively analyse past regulatory and supervisory failures at RBI —an aspect so critical for making decisions with regard to providing bank licenses to large industrial corporate groups and NBFCs MFIs. Further, it also needs to be emphasised that many panel members have had (and some continue to have) strong associations with institutions that were at the heart of the 2010 AP micro-finance crisis. Finally, the panel also includes regulators whose questionable approach (and actions) during the years preceding the October 2010 AP micro-finance crisis had serious consequences in the ground. These certainly, resulted in some form of regulatory/supervisory failure which, in turn, exacerbated the 2010 AP micro-finance crisis. Therefore, I am not sure that due thought and procedure has been applied to deciding on the composition of the Dr Bimal Jalan Banking Selection Advisory Panel.


Fifth, the suddenness with which a new committee on financial inclusion (FI) was appointed by the RBI really surprised everyone because a live committee on the same subject has already been functioning at the RBI under senior deputy governor, Dr KC Chakravarthy, since 2012. That is not all. As noted in previous Moneylife articles, the composition of this new financial inclusion (FI) committee has left a lot to be desired as many members of this (FI) committee have significant conflicts of interests. Apart from being closely related to each other in a professional sense, a couple of the members of the FI committee represent institutions that have directly applied for the banking license. Also, there are many members of the committee who represent (and/or serve on the boards of) institutions that have significant relationships with various banking license applicants.


Further, many of the institutions — that the new financial inclusion committee members represent (directly or indirectly) — also have very significant commercial interests in the area of financial inclusion. And what is really shocking is that this insider (industry) committee with the above characteristics is to draft the overall vision and recommend the regulatory architecture for the broad area of financial inclusion. This is surely, a recipe for big time disaster as past global crises have clearly demonstrated. And the icing on the cake is the fact that this financial inclusion committee runs parallel to the banking selection advisory panel (in terms of its time frame) and the chair of the financial inclusion committee is also a member of the banking selection advisory panel. As noted above, recall that two banking applicants are themselves part of the financial inclusion committee and also that several members of this FI committee represent institutions (directly or indirectly) that have provided (or are providing) debt, equity and other support (in a commercial manner) to the banking applicants and other micro-finance industry players —in other words have significant professional interest in these banking applicants as well as other micro-finance institutions, some of whom were also involved in the 2010 AP micro-finance crisis. As a reputed professor of finance at IIM so aptly put it, the new RBI financial inclusion committee, has no CONFLICTS but ONLY interests.


Sixth, when the Hon PSCF, is looking at the broad subject matter of financial inclusion through the prism of the Micro-Finance Institution Development and Regulation (MFIDR) Bill, RBI’s action of appointing a new financial inclusion committee smacks of total disregard for the Indian Parliament. I simply do not understand the need for pre-empting Parliament!


In summary, given the above, I strongly feel that the time is now absolutely ripe to make the RBI, India’s central bank, more accountable, to the people of India. With its wide ranging powers and greater impact on all aspects of the economy, the accountability of RBI assumes even greater importance and should not be ignored. Indeed, as Mr Surjit Bhalla and others have long argued, The time has come for accountability at the RBI. This institution makes decisions that affect the fortunes (lately misfortunes) of many Indians, rich and poor.”v And this accountability will have to come in several transparent ways and these are discussed extensively in a sequential article.

i Source: Senate hearing, December 2009. (and as cited from other web documents)

ii Source: RBI Act of 1934, 2 of 1934, page 12 of pdf file from RBI site -

iii Compiled from various Acts and documents available on RBI site, including speeches of past RBI governors. When I say additional function, I am strictly interpreting what has been said by past Governors like Dr Subbarao and also the documents available on the RBI site. I am not implying any hierarchy in functions, as far as the RBI is concerned



(Ramesh S Arunachalam has over two decades of strong grass-roots and institutional experience in rural finance, MSME development, agriculture and rural livelihood systems, rural and urban development and urban poverty alleviation across Asia, Africa, North America and Europe. He has worked with national and state governments and multilateral agencies. His book—Indian Microfinance, The Way Forward—is the first authentic compendium on the history of microfinance in India and its possible future.)






4 years ago

RBI has numerous functions and responsibilities and for the proper discharge it is necessary that accountability is in place. Without accountability there is bound to be lethargy on the part of employees and in exceptional cases malafide intention too. In view of better governance, accountability and stricter penalties is necessary to obviate happenings of frauds.

Gopalakrishnan T V

4 years ago

The article is very well written and has convincingly argued to fix accountability of RBI to the people of India for their fortunes and now the misfortunes. The RBI's core functions and additional functions are by and large carried out to the best of its professionalism and are presented before the Parliament and the Parliament Standing Committee on Finance.No doubt, RBI's functions often give rise to conflict of interest and this results perhaps in the necessity for fixing accountability for RBI.The reasons are not far to seek in making RBI working perhaps not in the interests of bringing in economic inequity. The RBI does not enjoy the autonomy as it deserves as a full fledged Central Bank. All its Directors are appointed by the Central government and they are not expected to dissent from the thinking of the Ministry of Finance or the Government. Unlike many Central Banks of the world, RBI has been entrusted with the responsibility of rural development by statute and other developmental functions apart from core Central Banking functions. Though NABARD has been set up exclusively for Agriculture and Rural Development, RBI has not been relieved of the development of agriculture and rural development. The Financial Inclusion cannot be the exclusive responsibility of RBI where the involvement of State, central and other agencies have an active role and responsibility taking into account the envisaged social and financial role of various financial institutions functioning both in rural and other areas. No doubt RBI has to be made accountable for its functions,but given the present circumstances,there are many aspects to be looked into taking into account the relationship between the RBI and the Government,the socio- economic conditions of the country and the general governance standards and accountability. The author's approach , however,deserves appreciation and a lot has to be done before the objective is set.


Ramesh S Arunachalam

In Reply to Gopalakrishnan T V 4 years ago

Thank you sir for your detailed views. I appreciate what you are saying and I have said that the RBI's role is far greater than that of even a full service central bank. That said, whether fair or not, we tend to judge institutions by their own standards and I must say that the standards for RBI will be always higher because it has traditionally set higher standards than other regulators. So, please take it in that perspective. In fact, that is why my concern related to a spate of recent events, which seem un RBI like (in its traditional form). Also, as RBI's roles have expanded significantly, I am sure that there is always scope for performance enhancement. Thanks very much for your points on autonomy and other aspects and these are well taken sir and I will factor these in as I write the sequential articles. For ordinary people like me, a debate like this is also useful as it helps clarify things. Thanks again sir


4 years ago

This Is How Our Central Bank Work

nagesh kini

4 years ago

Ramesh's article only reconfirms all that I've stated in my article "Indian Banking scenario and the RBI's new avatar" carried yesterday.
The RBI has gone a long way since it was started and more water has flown down the Thana Creek, Mumbai and Jamuna Bridges!
1.Like the US Fed. Res. Gov. the appointment of the RBI Governor ought to be confirmed by the Parliamentary Committee.
2. RBI is no holy cow, it's accounts need to be subjected to CAG Audit.
3. They sat on the Damodaran Committee Report for long, it required a RTI query to force them to put it out.
4. Why Nachiket Mor Committee when FSRLC Committee has covered much the same ground?


Ramesh S Arunachalam

In Reply to nagesh kini 4 years ago

Thanks Sir for your kind feedback and your very insightful article, which I liked very much. We will be incorporating all these even as we bring in a crucial distinction in Governance of Central Banks. Traditionally, there has been a greater focus on policy governance but aspects like those stated above by you and others will fall into the institutional governance realms, which has hitherto been neglected. As a child, when I was growing up, I have always heard the phrase, "Charity begins at home" and most certainly, the RBI, which expects Good Governance and Accountability from other institutions must likewise focus inwardly on institutional governance. More in my articles and thanks again sir. I am learning a lot from all of you and thanks sir. Have a nice day!

nagesh kini

In Reply to Ramesh S Arunachalam 4 years ago

Of all the Regulators, SEBI, IRDA, TRAI or ICAI, RBI has been relatively more efficacious as a Watchdog.
There is much more scope for improvement. As vital stakeholders, we all, you and I do have a role to play in pushing for more reforms by virtue of our long experience and exposure, more particularly as users and professionals in the in depth know of the state of affairs. After all a person who actually wears the shoe knows where it pinches. Not arm chair activists sitting in air conditioned ivory towers! Over to you.


4 years ago

The more traditional Central Banks such as Sweden and Britain have nothing much to offer beyond a reading of DeKock. But, the History of the Reserve Bank of New Zealand is well worth a study on how accountability needs to be brought to bear on a Country's Central Bank. Their Annual Reports for 1997,1998,and 1999, say a great deal from which India should learn.


Ramesh S Arunachalam

In Reply to SuchindranathAiyerS 4 years ago

Thanks Sir and I was going to use their example (Reserve Bank of New Zealand) but thanks again and will factor your suggestions in appropriately

Thanks sir and your kind comments are much appreciated!

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