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Prospective payment.

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H Darmstadter. 1984. Prospective payment.. https://doi.org/10.1176/ps.35.10.1043

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Recently proposed HMO regulations have involved mandates of two forms: (1) minimum quality standards, and (2) mandated increases in access to speciality care. I show that piecemeal regulation, which uses only one of either mandate (1) or (2), may decrease welfare for all HMO consumers. Under full regulation using both (1) and (2), if the minimum standard is set too low, say, due to political bargaining, a floor-to-ceiling effect occurs. This involves HMOs setting quality at the minimum standard, even when their quality would be above the standard in an unregulated market. Finally, I show how premiums may either increase or decrease under a mandate.

Costs and Cost Analysis↗

Technical cost of CT examinations.

PURPOSE: To measure the technical cost of different categories of computed tomographic (CT) examinations. MATERIALS AND METHODS: For fiscal year 1997, the technical costs of performing CT examinations in a tertiary care academic medical center were measured. Costs were divided into labor and nonlabor categories. Indirect departmental costs were fully allocated according to activity-based methods. Hospital overhead costs were set at 85% of the departmental budget. Physician costs, including those related to image interpretation were not included. The technical cost of CT was determined on a per technical relative value unit (RVU) basis and on a per examination basis. For the latter, the technical cost of nonenhanced CT, contrast material-enhanced diagnostic CT, and interventional CT procedures were determined. RESULTS: In fiscal year 1997, 45,599 examinations (22,158 [48.6%] abdominal and/or pelvic, 12,115 [26.6%] head and neck, 6,572 [14.4%] thoracic, 1,593 [3.5%] interventional, and 3,161 [6.9%] other) were performed with five CT scanners for a technical RVU output of 254,461. Of 45,599 examinations, 31,007 (68%) were performed with intravenously administered contrast medium. Overall labor costs were $1,744,653, and nonlabor costs were $2,912,282. The cost of a hypothetical CT examination with a mean technical RVU of 5.58 was $189. The overall cost per examination was $150 for nonenhanced CT, $237 for contrast-enhanced CT, and $462 for interventional CT. CONCLUSION: Although CT is based on sophisticated technology, the mean technical cost of a diagnostic CT examination is less than $200.

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