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PubMedDate not supplied

Improving health care outcomes through reallocation of health care expenditures.

The use of incremental cost-outcomes ratios as decision variables by those working in the area of pharmacoeconomics is commonplace. Unfortunately, few question the assumptions implicit in the use of such ratios. In this paper, the author argues that under certain reasonable assumptions regarding the production of health care and alternative therapy options, if partial substitution or switching between therapy options occurs, it may be possible not only to stay within an initial health care budget but also to yield higher total outcomes for the treating population. This argument is presented by developing a model of health care costs and outcomes in a dual-therapy environment.

Delivery of Health Care↗

PubMed2006

Health care use and costs in the decade after identification of type 1 and type 2 diabetes: a population-based study.

OBJECTIVE: To analyze trends in health care costs in the decade after identification of diabetes, contrasting type 1 and 2 diabetes. RESEARCH DESIGN AND METHODS: The Canadian National Diabetes Surveillance System criteria were applied to administrative databases to identify incident diabetes cases in 1992. Cases were categorized as type 1 or type 2 diabetes based on patterns of drug use. Per capita health care costs (in 2001 Canadian dollars) for five resource categories were estimated according to the type of diabetes, for the year before identification (1991) and 10 years after (1992-2001) identification of the cases. RESULTS: We identified 156 type 1 and 3,469 type 2 incident cases of diabetes, from a population base of approximately 950,000. The mean (+/-SD) age of case subjects at index was 61.2 +/- 16.7 years, and 54% of subjects were male. Overall annual per capita health expenditures rose considerably in the year after identification of diabetes but then stabilized at a lower level for the next 9 years, ranging from $3,800 to $4,400. From 1992 to 2001, diabetic individuals used $137.1 million in health care resources, most of which (96%) was attributable to type 2 diabetes. The average 10-year cost per individual with diabetes was $37,820 ($33,684 per type 1 and $38,006 per type 2 diabetes case; adjusted P = 0.45). CONCLUSIONS: Total health expenditures for diabetes are driven by the much larger prevalence of type 2 compared with type 1 diabetes. Policymakers need to acknowledge and allocate resources for diabetes prevention and management accordingly.

Adult↗

PubMed1999

Managed behavioral health care and supply-side economics. 1998 Carl Taube Lecture.

BACKGROUND: Within the past decade, the mental health care system in the United States has undergone a significant transformation in terms of delivery, financing and work force configuration. Contracting between managed care organizations (MCOs) and providers has become increasingly prevalent, paralleling the trend in health care in general. These managed care carve-outs in behavioral health depend on networks of providers who agree to capitated rates or discounted fees for service for those patients covered by the carve-out contracts. Moreover, the carve-outs use a broader array of mental health providers than is typically found in traditional indemnity plans, encourage time-limited versus long-term treatments and favor providers who are engaged in outpatient care. This phenomenal growth in managed behavioral health care over the past decade includes the rapid growth and quick consolidation of mental health MCOs. The period 1992-1998 shows steady and substantial annual increases in the number of enrollees in mental health MCOs, the figure more than doubling from 78.1 million people in 1992 to a projected 156.6 million in 1998, or 70% of insured lives. Moreover, these vast numbers of enrollees are becoming increasingly consolidated into a smaller number of firms. In 1997, 12 companies controlled nearly 85% of the managed behavioral health care market, with 60% of the market held by the three largest firms. STUDY AIMS: This article reviews empirical data and draws policy implications from the literature on managed behavioral health care in the United States. Starting with spending and spending trend estimates that show the average annual growth rate of mental health expenditures to be lower than that of health care expenditures in general over the past decade, the author examines utilization and price factors that may account for managed-care-induced cost reductions in behavioral health care, with special attention to hospital use patterns, fee discounting and the supply and earnings patterns of various types of mental health provider. In addition, data on staffing ratios and provider mixes of health maintenance organizations and mental health MCOs are reviewed as they reveal at least part of the dynamics of reconfiguration of the mental health work force in this era of managed care. CONCLUSIONS: As measured by changes in utilization and price, widespread application of "classic" managed care techniques such as preadmission review (gatekeeping), concurrent review, case management, standardized clinical guidelines and protocols, volume purchase of services and fee discounting appears to have led to significant cost reductions for providers of both impatient and outpatient mental health services. However, amidst a complex flux of market variables such as risk shifting, changing financial incentives and intensity of competition, not all of the reduction or slowdown in spending can be clearly and purely attributed to managed care. The data on the ongoing reconfiguration of the mental health work force are clearer in their implications: with an oversupply of all types of mental health providers, managed care has significant potential to increase the incidence of provider substitutions and spur the growth of integrated group practices. IMPLICATIONS FOR FURTHER RESEARCH: The current body of empirical and policy literature in mental health economics suggests several salient areas of follow-up. Is the proportionately greater impact of managed care on the annual growth rate of mental health care spending a temporary phenomenon or does it signal an enduring difference in the rates of increase between behavioral health care and health care in general? Beyond industry downsizing, what are the substitutions among mental health providers that are going on, and will go on, to produce cost-effective practices? What are the new financial or risk-sharing arrangements between providers and MCOs that will produce appropriate and high-quality mental health services?

Journal Article↗

PubMed1995

The use of hospital emergency departments for nonurgent health problems: a national perspective.

The use of the hospital emergency department (ED) for nonurgent health problems has been a subject of considerable controversy, in part because there is no widely accepted definition of "nonurgent." Elimination or substantial reduction in nonurgent ED use is frequently offered as a strategy for reducing health expenditures. Previous studies, often limited to individual hospitals or communities, have limited generalizability and do not permit examination of multiple factors likely to influence nonurgent ED utilization or examination of ED use for nonurgent problems in the context of overall outpatient utilization. This analysis of the 1987 National Medical Expenditure Survey (NMES) provides a nationally representative examination of nonurgent ED utilization that describes the frequency of ED use for nonurgent problems, characteristics of individuals that are associated with an increased likelihood of nonurgent ED use, the use of other outpatient physician services, and expenditures associated with nonurgent ED visits.

Cost Control↗

PubMed1988

National planning for locally controlled health systems: the Finnish experience.

The World Health Organization considers Finland's health planning system to be among the most successful in the developed world. Despite tight resource constraints--symbolized by total health expenditures held consistently to less than 7 percent of gross domestic product--the Finns have built up a strong primary care sector and dramatically improved the overall availability and accessibility of needed services. This article compares the official health planning system with the actual planning process as experienced within one Finnish central hospital district. The official planning system seeks to integrate national strategic goals with local municipal ownership, administration, and funding of service delivery. The actual planning process within the studied district suggests that technically oriented civil servants at the regional level may be at least as important in the overall decisionmaking structure. The article concludes with a brief exploration of this finding's potential consequences for the long-term development of the Finnish health care system and for national health planning efforts generally.

Cost Control↗

PubMedDate not supplied

Quality of life after hip fracture surgery in the elderly.

As the world population ages, the prevalence of osteoporosis and the incidence of hip fractures will increase dramatically, being responsible for an increase of the health expenditure. On the other hand, there is the inescapable fact of scarcity creating the necessity of making difficult choices with regard to the allocation of human resources. So the question remains: should we carry on investing an important part of our health expenditure for the treatment of hip fractures in elderly people? To answer this statement, we compared 384 hip fracture patients of 70 years and older treated in our department between 1978 and 1983 with 1102 patients treated between 1998 and 2003. Both groups had a prospective follow-up of at least one year. There were no statistically significant differences: mortality rate 24% vs. 23%; good functional outcome 82% vs. 73%; and home going rate 60% vs. 66%. The factors influencing these results were studied. So we can conclude: The number of hip fractures treated nowadays has increased compared with twenty years ago; There is no significant improvement in mortality, nor in quality of life; Age is not a contraindication for hip fracture surgery.

Activities of Daily Living↗

PubMed2005

National estimates for maternal mortality: an analysis based on the WHO systematic review of maternal mortality and morbidity.

BACKGROUND: Despite the worldwide commitment to improving maternal health, measuring, monitoring and comparing maternal mortality estimates remain a challenge. Due to lack of data, international agencies have to rely on mathematical models to assess its global burden. In order to assist in mapping the burden of reproductive ill-health, we conducted a systematic review of incidence/prevalence of maternal mortality and morbidity. METHODS: We followed the standard methodology for systematic reviews. This manuscript presents nationally representative estimates of maternal mortality derived from the systematic review. Using regression models, relationships between study-specific and country-specific variables with the maternal mortality estimates are explored in order to assist further modelling to predict maternal mortality. RESULTS: Maternal mortality estimates included 141 countries and represent 78.1% of the live births worldwide. As expected, large variability between countries, and within regions and subregions, is identified. Analysis of variability according to study characteristics did not yield useful results given the high correlation with each other, with development status and region. A regression model including selected country-specific variables was able to explain 90% of the variability of the maternal mortality estimates. Among all country-specific variables selected for the analysis, three had the strongest relationships with maternal mortality: proportion of deliveries assisted by a skilled birth attendant, infant mortality rate and health expenditure per capita. CONCLUSION: With the exception of developed countries, variability of national maternal mortality estimates is large even within subregions. It seems more appropriate to study such variation through differentials in other national and subnational characteristics. Other than region, study of country-specific variables suggests infant mortality rate, skilled birth attendant at delivery and health expenditure per capita are key variables to predict maternal mortality at national level.

Adult↗

PubMed2003

Social inequalities in health- do they diminish with age? Revisiting the question in Sweden 1999.

BACKGROUND: Individuals with low income have poorer health and should, therefore, have higher health expenditure than people with high income particularly in countries with a universal health care system. However, it has been discussed if social inequities in health diminish with age and we, hence, aimed to analyse this question. METHODS: We performed an age stratified cross-sectional analysis using averages, logistic and linear regression modelling of health care contacts, health care expenditures and mortality in relation to individual income in five groups by quintiles. The population consisted of all the 249,855 men aged 40 to 80 years living in the county of Skåne, Sweden during 1999. RESULTS: For working-age people (40-59 year old) we find a clear socioeconomic gradient with increasing probability of health care contact, relative expenditure and mortality as income decreased. The point estimations for 1st (highest)-2nd-3rd-4th and 5th (lowest) income groups were: (1.00-1.13-1.21-1.42 and 1.15), (1.00-1.16-1.29-1.69 and 1.89) and (1.00-1.35-1.44-2.82 and 4.12) for health care contact, relative expenditure and mortality respectively. However, in the elderly (75-80 year old) these point estimates were (1.00-0.83-0.59-0.61 and 0.39), (1.00-1.04-1.05-1.02 and 0.96) and (1.00-1.06-1.30-1.33 and 1.49). CONCLUSIONS: As expected among working-age individuals, lower income was associated with higher health care contact, relative expenditure and mortality. However, the existence of opposite socioeconomic gradients in health care utilisation and mortality in the elderly suggests that factors related to a high income might condition allocation of resources, or that current medical care is ineffective to treat determinants of income differences in mortality occurring earlier in the lifecourse.

Journal Article↗

PubMed1996

Health promotion and disease prevention: a look at demand management programs.

This Issue Brief describes employers' efforts to contain health expenditures through demand management programs. These programs are designed to reduce utilization by focusing on disease prevention and health promotion. Demand management includes work site health promotion, wellness programs, and access management. Work site health promotion is a comprehensive approach to improving health and includes awareness, health education, behavioral change, and organizational health initiatives. Wellness programs usually include stress management, smoking cessation, weight management, back care, health screenings, nutrition education, work place safety, prenatal and well baby care, CPR and first aid classes, and employee assistance programs (EAPs). These programs are often viewed positively by workers and can have long-term benefits for employers above and beyond health care cost containment. Demand management can benefit employers by increasing productivity, employee retention, and employee morale and by reducing turnover, absenteeism, future medical claims, and ultimately expenditures on health care. Even though a growing number of employers are offering wellness programs, only 37 percent of full-time workers employed in medium and large private establishments were eligible for wellness programs by 1993. However, a recent survey found that 88 percent of major employers have introduced some form of health promotion, disease prevention, or early intervention initiative to encourage healthy lifestyles among their salaried employees. Distinctions must be drawn between short- and long-term strategies. Demand management can be thought of as a short-term strategy when the focus of the program is on creating more appropriate and efficient health care utilization. Disease prevention is characterized by longer-term health improvement objectives. Whether the purpose is to reduce utilization in the short term or in the long term, the ultimate goal remains the same: to reduce health care expenditures while improving overall health. This goal can be achieved through the use of health risk appraisals, organizational health risk appraisals, high risk programs, awareness programs, medical call centers, return to work programs, EAPs, and smoking cessation programs. Studies of a health program's cost effectiveness must disentangle the effects of many competing factors on cost effectiveness. For example, a health risk appraisal program may identify health problems of which the patient and the health care provider were unaware, resulting in the treatment of these health problems. At the same time, the employer may have switched from a nonmanaged pharmaceutical program to a managed program with incentives for participants to utilize generic and/or mail order drugs. As a result, when evaluating a health promotion program, the long-run impact on the program's cost effectiveness is most important.

Cost Control↗

PubMed1999

Economic analysis of step-wise treatment of gastro-oesophageal reflux disease.

BACKGROUND: To expose patients with gastro-oesophageal reflux disease (GERD) to the least amount of medication and to reduce health expenditures, it is recommended that their treatment is started with a small dose of an antisecretory or prokinetic medication. If patients fail to respond, the dose is increased in several consecutive steps or the initial regimen is changed to a more potent medication until the patients become asymptomatic. Although such treatment strategy is widely recommended, its impact on health expenditures has not been evaluated. METHODS: The economic analysis compares the medication costs of competing medical treatment strategies, using two different sets of cost data. Medication costs are estimated from the average wholesale prices (AWP) and from the lowest discount prices charged to governmental health institutions. A decision tree is used to model the step-wise treatment of GERD. In a Monte Carlo simulation, all transition probabilities built into the model are varied over a wide range. A threshold analysis evaluates the relationship between the cost of an individual medication and its therapeutic success rate. RESULTS: In a governmental health care system, a step-wise strategy saves on average $916 per patient every 5 years (range: $443-$1628) in comparison with a strategy utilizing only the most potent medication. In a cost environment relying on AWP, the average savings amount to $256 (-$206 to +$1561). The smaller the cost difference between two consecutive treatment steps, the longer one needs to follow the patients to reap the benefit of the small cost difference. However, even a small cost difference can turn into tangible cost savings, if a large enough fraction of GERD patients responds to the initial step of a less potent but also less expensive medication. CONCLUSIONS: The economic analysis suggests that a step-wise utilization of increasingly more potent and more expensive medications to treat GERD would result in appreciable cost savings.

Algorithms↗

PubMed1990

Financing health care: out of whose pocket?

Health expenditures have grown steadily in the United States, but though United States spending is the highest in the world, it may not be as far out of line as is often assumed. However, although the economy is capable of absorbing an increasing amount of health care without reducing other consumption, financing mechanisms are breaking down. That part of Medicare financed through payroll taxes will be insolvent by the year 2003; the rest of Medicare and all of Medicaid adds to a growing budget deficit. And, the free market fails to provide rational long-term financing of long-term care.

Attitude to Health↗

PubMed2005

Costs of illness and coping strategies in a coffee-growing rural district of Ethiopia.

The paper describes a cross-sectional household survey conducted in randomly-selected villages in rural Ethiopia to assess strategies of households for coping with financial and time costs of illness. Results of the survey showed that the average monthly household health expenditure was 32.87 Birr (about 4.1 US dollars [1 US dollar = 8 Birr at the time of study]). In addition, the average time lost due to illness was 9.23 days for the sick and 7.38 days for their caretakers. Monetary price was a significant (p<0.05) deterrent from visiting health facilities among households with no land or house, the divorced or widowed, and those with annual income less than 500 Birr (62.5 US dollars). The main strategies to cope with the financial costs of illness were waiver privileges, selling household assets, and using savings. Division of labour among household members was used for compensating for the loss of working time due to sickness. The findings of the study indicate that financial and time costs of illness seem to significantly contribute to the impoverishment of rural households.

Adaptation, Psychological↗

PubMed2000

Obesity morbidity and health care costs in France: an analysis of the 1991-1992 Medical Care Household Survey.

OBJECTIVE: To estimate the direct medical costs associated with obesity in France. DESIGN: Analysis of the French 1991-1992 National Household Survey database comprising a representative sample of 14, 670 individuals aged 18 y and over. A subgroup of subjects with a body mass index (BMI)>/=30 kg/m2 was compared with a control group of normal-weight individuals (BMI 18.5-25 kg/m2) matched on age, gender and education level. MEASUREMENTS: Self-reported weight and height used to calculate individual body mass index and health expenditures in a 3 month period, and morbidity as declared by respondents to the national household survey and verified on medical records. RESULTS: The direct cost attributable to obesity (BMI>/=30 kg/m2) was estimated to be in the range 4.2-8.7 billion French Francs (FF) in 1992 value, that is between 0.7 and 1.5% of total health expenditures. CONCLUSION: These results were of the same order of magnitude as similar estimates obtained by a top-down approach for the same year and setting. International Journal of Obesity (2000) 24, 151-155

Adolescent↗

PubMed2004

Impact of the case payment reimbursement method on the utilization and costs of laparoscopic cholecystectomy.

The purpose of this study was to examine the relationship between adoption of case payment for laparoscopic cholecystectomy (LC) and the growth rate of LC, outcomes of patients undergoing LC, and total healthcare expenditures on cholecystectomy. We used the claims data from Bureau of National Health Insurance (BNHI) to identify patients who underwent LC and open cholecystectomy (OC). Data were available from January 1996 to October 1997 and from January 1998 to October 1999, enabling use to compare data from before and after the introduction of the new case payment system. Results showed that the volume and the proportion of LCs increased after adoption of the new payment method. We did not find a sharp increase in the cholecystectomy rate during the study period. In terms of outcomes, the admission rate for emergencies decreased; the surgery mortality rate decreased, but the readmission rate increased. The average cost and length of hospital stay for LC subjects decreased; however, the total cost of cholecystectomy increased. The impact on LC of the introduction of a case payment method failed to reduce total health expenditures for cholecystectomy.

Adolescent↗

PubMed1990

Technology as culprit and benefactor.

Technologies can be viewed as a mixed blessing: rising health care costs versus improved diagnosis, treatment, and health status. This article briefly discusses the influence of key factors on the demand for technology and its utilization. These factors include rising health expenditures, changes in populations, and the development of cost containment strategies. Resulting shifts in incentives and utilization are examined. Because of the difficult and complex issues associated with the increasing use of medical technologies, hard choices will need to be made about quality of life, technology assessment, and the allocation of health resources to the terminally ill.

Diffusion of Innovation↗

PubMed2005

Determinants of the diffusion of computed tomography and magnetic resonance imaging.

OBJECTIVES: The aim of this study is to explain factors influential to the diffusion of computed tomography (CTs) and magnetic resonance imaging (MRIs). METHODS: Variables were identified from a review of the literature on the diffusion of health technologies. A formal process was applied to build a conceptual model of the mechanism that drives technology diffusion. Variables for the analysis were classified as predisposing, enabling, or reinforcing factors, in keeping with a model commonly used to explain the diffusion of health behaviors. Multiple regression analysis was conducted using year 2000 OECD data. RESULTS: The results of this study showed that total health expenditure per capita (p < .01, both CTs and MRIs) and flexible payment methods to hospitals (p < .05, both CTs and MRIs) were significantly associated with the diffusion of CTs and MRIs (adjusted R2 = 0.477, 0.656, respectively). CONCLUSIONS: This study presents a systematically developed model of the mechanism governing technology diffusion. Important findings from the study show that purchasing power, represented by total health expenditure per capita and economic incentives to hospitals in the form of flexible payment methods, were positively correlated with diffusion. Another important achievement of our model is that it accounts for all thirty OECD member countries without excluding any as outliers. This study shows that variation across countries in the diffusion of medical technology can be explained well by a logical model with multiple variables, the results of which hold profound implications for health policy regarding the adoption of innovations.

Diffusion of Innovation↗

PubMed2004

Resource allocation equity in northeastern Mexico.

Currently, the population health needs are unlimited, but allocation of financial resources is not in accordance with these needs, probably due to the lack of specific information. In this work, we propose a new approach to allocate resources with equity as a tool for decision-making in planning. The grade of equity in resource allocation in decentralized management medical areas (DMMAs (AMGD, for its initials in Spanish)) was determined; these are limited geographical areas of a social security institution in three states of the northeastern region of Mexico. The areas with more health needs in the global index were DMMA no. 12 in Tamaulipas with a Z-score (ZS) of -5; area no. 3 in Coahuila with -4; and area no. 9 in Nuevo Leon, no. 16 and no. 17 in Tamaulipas with -2. Equity was measured according to the degree of concordance between the health needs index and the per capita health expenditure of each area: (r = 0.19, P > 0.05). Low concordance was found between these variables in the studied medical areas.

Health Care Rationing↗

PubMed1997

Impact of an easy-access VA clinic-based program for patients with bipolar disorder.

OBJECTIVE: The study examined the impact of easy access to ambulatory services for patients with bipolar disorder in a clinic-based program at a Veterans Affairs medical center. Core program components included medication administration based on treatment algorithms, standardized psychoeducation, and easy access to a single primary nurse provider to enhance continuity of care. The program had no community outreach or extensive rehabilitation components. METHODS: The study used a mirror-image design to compare patients' data from the year before program entry when patients received standard clinical care with data for the first year in the program. Process and outcome data from the first 103 patients to complete one year are reported. RESULTS: The findings indicated increased patient satisfaction and increased intensity of medication treatment without increased side effects at one year. Although scheduled ambulatory clinic visits increased as expected, use of the emergency room and the psychiatric triage team decreased significantly. Patients who were high utilizers of care before program entry experienced significant reductions in psychiatric hospital days and total mental health expenditures. CONCLUSIONS: Easy access to ambulatory care, even if limited to clinic-based services, may have beneficial effects on important process and outcome measures for bipolar disorder. These effects may be attributable to on-demand access to services, continuity of care with a single primary provider, or improved medication delivery to reduce the "efficacy-effectiveness gap" for patients with bipolar disorder. Results indicate that augmenting, rather than limiting, access to ambulatory care for patients with major mental illnesses such as bipolar disorder may reduce overall mental health expenditures.

Adult↗