SEARCH · Search PubMed
Search indexed PubMed citations on genomics, clinical trials, systematic reviews and public health. Explore titles, authors and supplied subject terms, then open the PubMed record.
Quote a phrase for an exact phrase match. Source license links do not imply unrestricted reuse.
Specialty budgeting and costing have attracted wide interest among health service finance officers in recent years. In the first of three articles describing how the techniques have developed, author examines specialty costing in his own authority.
BACKGROUND: Growing reliance on service provision through systems and networks creates the need to better understand the nature of the relationship between service collaboration and hospital performance and the conditions that affect this relationship. OBJECTIVE: We examine 1) the effects of service provision through health systems and health networks on hospital cost performance and 2) the moderating effects of market conditions and service differentiation on the collaboration-cost relationship. RESEARCH DESIGN: We used moderated regression analysis to test the direct and moderating effects. Data on 1368 private hospitals came from the 1998 AHA Annual Survey, Medicare Cost Reports, and Solucient. MEASURES: Service collaboration was measured as the proportion of hospital services provided at the system level and at the network level. Market conditions were measured by the levels of managed care penetration and competition in the hospital's market. RESULTS: The proportion of hospital services provided at the system level had a negative relationship with hospital cost. The relationship was curvilinear for network use. Degree of managed care penetration moderated the relationship between network-based collaboration and hospital cost. CONCLUSION: The benefits of service collaboration through systems and networks, as measured by reduced cost, depend on degree of collaboration rather than mere membership. In loosely structured collaborations such as networks, costs reduce initially but increase later as the extent of collaboration increases. The effect of network-based collaboration is also tempered by managed care penetration. These effects are not seen in more tightly integrated forms such as systems.
The aim of this study was to estimate the direct medical costs of chronic obstructive pulmonary disease (COPD) in the United States using a public-payor perspective. Cost estimates were derived separately for 10 components of care using national survey databases and valued using Medicare and Medicaid reimbursement rates. COPD affects 15 million people in the U.S.A. and the total annual U.S. payment for care is $6.6 billion. Approximately one-third ($2.3 billion) is due to the cost of long-term oxygen therapy, one-quarter is attributed to hospitalizations and inpatient physician services ($1.9 billion), and one-seventh ($942 million) is due to nursing home stays. Other annual costs are outpatient physician visits ($480 million), prescription medications ($462 million), home healthcare ($309 million), emergency department visits ($148 million), outpatient diagnostic procedures ($55 million) and hospice care ($28 million). The cost of COPD is therefore considerable. The significant expenditure for long-term oxygen therapy indicates that disease severity is a major driver of costs. However, the cost of hospitalizations, nursing home stays, emergency department and physician visits are not insignificant.
A laboratory costing system which recovers all costs against tests, rather than using both test and request charges, was developed. Methods of recovering costs of routine and emergency services, of capital investment in equipment, of instrument maintenance costs and of general hospital overheads were considered. The Welcan unit system of workload measurement was applied to a range of test procedures. Both the Welcan unit value and unit value adjusted fro calibration and quality control (Welcan based weighting) correlated only moderately with locally derived analytical time per test and correlated poorly with direct analytical cost per test. The correlation of direct analytical cost per test with total cost per test was much stronger than that of analytical time per test with direct analytical cost per test. The data suggest that neither Welcan unit values, Welcan based weightings, nor locally derived analytical time per test can truly reflect total resource consumption for the provision of a range of test procedures. This factor should be borne in mind when applying operational or performance indicators based on Welcan units.
Little or no information exists about the costs of providing services in the National Health Service. A study was commissioned to measure the costs of running the department of rheumatology in Cornwall. The results emphasised the relative cheapness of outpatient care compared with inpatient care.
This paper urges the benefits of applying more widely a method for pathology laboratory costing originally devised for a clinical chemistry department, and illustrates these with examples drawn from costing studies in three clinical laboratories. Heads of pathology departments, laboratory managers, administrators and clinicians require different kinds of costing information, each of which can be obtained by the costing procedure outlined. The method also yields valuable and sometimes surprising insights into the workings of a pathology service. Cost comparisons between different laboratories can now become more informative. Flaws in the concept of the "cost per test" are discussed and the value of this concept is questioned; for most purposes the cost per request has greater application.
OBJECTIVE: To estimate the secondary health service care and second line drug costs (including drug monitoring costs) for a cohort of people with early inflammatory polyarthritis (IP) and the subgroup classified as having rheumatoid arthritis (RA) recruited to a population based register. METHODS: The study population consisted of 344 people with IP who had enrolled on the Norfolk Arthritis Register (NOAR) in 1990-91, an average of 24 weeks after onset of their symptoms. Utilizing resource use data from NOAR, augmented by unit cost data from other sources, the average (per person) and cumulative secondary care and second line drug costs were estimated for Years 1, 2, 3, 4, and 5 following registration with NOAR. RESULTS: The total secondary health service care and second line drug costs were 472,125 (338,704 for RA subgroup) (1990-91 prices) over the 5 year study period, with inpatient stays, outpatient visits, and second line drugs accounting for 58, 9, and 33%, respectively. Nineteen percent of the study population neither visited hospital nor were prescribed second line drugs. CONCLUSION: Overall, inpatient stay costs represented the largest proportion of secondary health service care and second line drug costs, making 21% of the total study cohort responsible for 80% of the total 5 year costs incurred.
Owing to expected increases in the number of persons at risk for developing Alzheimer's disease and the expected decrease in the number of potential caregivers, the economic burden on society and families is expected to rise. Given changes in demographics and labor force participation, it is likely that the burden will be transferred from informal to formal paid services. Understanding the burden and cost of caring for this large population of patients is essential in order to make rational decisions with regard to allocating resources and providing quality care.
OBJECTIVE: The authors compared service utilization and costs for acutely ill psychiatric patients treated in a day hospital/crisis respite program or in a hospital inpatient program. METHOD: The patients (N = 197) were randomly assigned to one of the two programs and followed for 10 months after discharge. Both programs were provided by a community mental health center (CMHC) in a poor urban community. Data were collected for developing service utilization profiles and estimates of per-unit costs of the inpatient, day hospital, and outpatient services provided by the CMHC. RESULTS: On average, the day hospital/crisis respite program cost less than inpatient hospitalization. The average saving per patient was +7,100, or roughly 20% of the total direct costs. There were no significant differences between programs in service utilization or costs during the follow-up phase. Cost savings accrued in the index episode because per-unit costs were lower for day hospital/crisis respite and the average stay was shorter. Significant differences in cost were found among patient groups with psychosis, affective disorders, and dual diagnoses; psychotic patients had the highest costs in both programs. The two programs had roughly equal direct service staff and capital costs but significantly different operating costs (day hospital/crisis respite operating costs were 51% of inpatient hospital costs). CONCLUSIONS: The programs were equally effective, but day hospital/crisis respite treatment was less expensive for some patients. Potential cost savings are higher for nonpsychotic patients. Cost differences between the programs are driven by the hospital's relatively higher overhead costs. The roughly equal expenditures for direct service staff costs in the two programs may be an important clue for understanding why these programs provided equally effective acute care.
This study compared the cost-effectiveness of midwife services provided in birth centres operating as pilot projects with current hospital-based medical services in the province of Quebec. One thousand midwives' clients were matched with 1,000 physicians' clients on the basis of socio-demographic characteristics and obstetrical risk. Direct costs for the prenatal, intrapartum and postpartum periods were estimated. Effectiveness was assessed on the basis of three clinical indicators and four indices related to the individualization of care as assessed by women. Results show that the costs of midwife services were barely lower than or equal to those of physician services, but cost-effectiveness ratios were to the advantage of the midwife group, except for one clinical indicator (neonatal ventilation). Overall, this study provides rational support for the process of legalizing midwifery in the province.
This article describes a fee-for-service charging system for social work services in a "private" hospital. This system was developed because the financial pressures of the day appear to be causing a trend to decrease the level of social services provided in hospitals. The system has provided the Department of Clinical Social Work the opportunity to demonstrate the marketability of social work and to assure the department's financial viability.
OBJECTIVE: To develop estimates of the direct and indirect costs of smoking for California in 1999. METHODS: A prevalence based approach was used to estimate the annual costs of smoking. Econometric models were used to estimate the smoking attributable fraction (SAF) for direct costs (hospitalisations, ambulatory care, prescription drugs, home health care, and nursing home services) and indirect costs due to lost productivity from smoking related illness. The models controlled for socioeconomic factors and other risk behaviours. Epidemiological methods were used to estimate the SAF for indirect costs due to lost productivity from premature deaths. The SAFs were applied to total health care expenditures, days lost, and deaths to obtain smoking attributable total costs. RESULTS: In 1999, the total costs of smoking in California were 15.9 billion dollars, 475 dollars per resident, and 3331 dollars per smoker. Direct costs were 8.6 billion dollars (54% of the total), indirect costs due to lost productivity from illness were 1.5 billion dollars (10%), and indirect costs due to premature deaths were 5.7 billion dollars (36%). The cost of smoking was 9.4 billion dollars for men and 6.3 billion dollars for women. There were 43,137 deaths attributed to smoking, representing a total of 535,000 years of life lost. The value of life lost per death averaged 132,000 dollars, or 12.4 years. CONCLUSIONS: California smoking related costs are high. The cost methodology presented is useful for other states and nations interested in estimating their costs of smoking. Cost estimates can be used to evaluate the level of cigarette taxes and other policies related to smoking.
Government regulatory structures, prospective payment mechanisms, a more competitive environment, and attempts to link cost accounting principles to planning, budgeting, and fiscal control all have served as catalysts for hospitals to increase their reliance and emphasis on cost accounting. Current hospital accounting systems are relatively inexpensive to develop and maintain, and they fulfill the financial reporting requirements mandated by Medicare and other third-party payers. These systems, however, do not provide information on what specific service units cost, and managers must have this information to make optimal trade-offs between quality, availability, and cost of medical services. Most health care organizations have a predetermined charge for each type of service, but the charge may not accurately portray the cost of providing the service. Knowing true costs will enable managers to select the most cost-effective method of treating a patient; know the financial implications of adding tests or procedures; relate costs to established norms of care; establish ranges of acceptable costs in various diagnostic groups; negotiate more successfully with rate review organizations and health maintenance organizations; and vigorously market and advertise the services that most contribute to the organization's overall financial health. The goal of microcosting is to determine the full cost of providing specific service units. The microcosting process comprises three components: data collection, cost modeling, and cost analysis. Microcosting is used to determine full costs for 20 percent of the hospital's procedures that are responsible for generating 80 percent of the hospital's gross revenue. Full costs are established by adding labor costs, materials costs, equipment depreciation costs, departmental overhead costs, and corporate overhead costs.(ABSTRACT TRUNCATED AT 250 WORDS)
Since the prospective payment system mandated that they define and control costs more efficiently, healthcare organizations have separated nursing care from fixed overhead and reevaluated cost-containment restraints. Nursing objectives and daily data collection help to assign patients to one of four classes, from routine to continuous care. Providers can use these four classifications to monitor nursing productivity and allocate labor, employing such set variables as hours per patient day, indirect care, constant time, productive and nonproductive time, and profit margin. The result of this system is variable billing that more accurately reflects the true cost of nursing care. This proposed system of more open cost accounting makes patients and families more knowledgeable consumers. Administrators reviewing such cost breakdowns can evaluate nursing and other departments more effectively and market specific services more competitively. The system shows that nursing can be a profit, not a cost, center, which increases nurses' commitment and satisfaction. Organizations should encourage nurse managers to incorporate business into their traditional role. Cost accounting within nursing makes identified costs more manageable and increases efficiency throughout the organization.
BACKGROUND: Uncertainty surrounds the best approach to management of patients with symptomless abdominal aortic aneurysms of 4.0-5.5 cm in diameter. The UK Small Aneurysm Trial showed that surveillance and early prophylactic elective surgical repair had similar survival benefits. We compared the impact on health service costs and quality of life of these two management strategies. METHODS: We measured and valued direct health service costs for use of National Health Service resources. We used the Medical Outcomes Study short-form patients' health survey to measure health-related quality of life in several areas of functional status and well-being. We did analyses by intention to treat for all 1090 patients in the 93 trial centres. FINDINGS: The mean cost of treatment in the early-surgery group was significantly higher than that for ultrasonographic surveillance (UK pounds sterling 4978 vs 3914, difference pounds sterling 1064 [95% CI 799-1328]). This finding was robust for a range of assumptions that varied the time between surveillance visits and the mean unit cost of elective aneurysm repair. Health-related quality of life was generally similar 12 months after randomisation for the two groups, but early-surgery patients reported positive improvement in current health perceptions and less negative change in bodily pain. INTERPRETATION: Cost was higher for early surgery than for ultrasonographic surveillance for small aortic aneurysms. Early surgery is, however, associated with improvement in some features of health-related quality of life that should be taken into account with the finding that early surgical repair gives no significant survival advantage over surveillance.
A system of costing services provided to patients undergoing surgical procedures was instigated in a private and a public Victorian hospital. The cost of managing the care of patients undergoing like surgical procedures was developed and compared. It is suggested that such a system of cost allocation would enable members of the medical profession to be more cost conscious.
Schizophrenia is regarded as one of the most expensive mental illnesses because of its specific symptoms and characteristics. The care of schizophrenic patients consumed approx. 2 % of the total German health care expenditures in 1994, according to the scarce data provided by routine German health reporting. Despite this enormous impact, health-economical research in schizophrenia in Germany is widely neglected. While few empirical studies on direct cost of care for schizophrenic patients suggest that adequate comprehensive community care in Germany during the mid-nineties was about DM 27 000 to DM 28 000 per patient and year, there is a serious lackage of cost-effectiveness-studies, relating cost of care to outcome. Thus, the most basic data for any health care planning in schizophrenia is missing. This paper reviews the studies on cost of schizophrenia in Germany. It identifies the most serious knowledge gaps and describes the obstacles for an adequate research in this field.
The purpose of this study was to assess the relative health system cost of pediatric ambulatory hospital-based hemodialysis and home-based peritoneal dialysis, including both continuous ambulatory peritoneal dialysis and continuous cycling peritoneal dialysis when either treatment is equally appropriate. A cost analysis was performed from the viewpoint of the "study hospital" and service providers (physicians) using treatment protocols, based on current clinical practice, which incorporate procedures to establish dialysis access sites, ongoing dialysis maintenance, and possible complications. Cost estimates used information from the period between April 1, 1993, to March 31, 1994, including fully allocated inpatient and outpatient costs. A sensitivity analysis was conducted to analyze the effect of complications on treatment costs. Total annual costs (in 1994 Canadian dollars, $1.00 CDN approximately $0.75. US) of a typical and uncomplicated continuous ambulatory peritoneal dialysis, continuous cycling peritoneal dialysis, and hemodialysis patient were $47,569, $48,658, and $76,023, respectively. Differences in cost between peritoneal dialysis and hemodialysis patients were due to hemodialysis maintenance costs, which were attributed to larger physician fees (25.8 percent), greater direct treatment costs incurred by the study hospital (14.2 percent), and higher overhead costs (60.0 percent). The expected total cost of hemodialysis complicated by an arteriovenous fistula clot and central venous line blockages, or peritoneal dialysis complicated by hernia repair and peritonitis was $78,568 and $50,438 for hemodialysis and peritoneal dialysis, respectively. For the range of complication probabilities considered, expected total costs were always lower with peritoneal dialysis than with hemodialysis. The cost analysis demonstrates that peritoneal dialysis is less costly than hemodialysis for pediatric patients. Such analyses are but one component of the treatment decision, and as such, should not be viewed as the sole means to yield a treatment decision, but rather as a device for systematically evaluating the alternative treatment options.