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Dentistry today is exciting, vibrant, stimulating and demanding, but the costs to run a dental practice are extremely high. Constant planning and thought are necessary to allow optimum service to patients and provide adequate income. Specific cost-control measures are offered.
BACKGROUND: Cost-effectiveness analysis (CEA) is used by payers to make coverage decisions, by providers to make formulary decisions, and by large purchasers/employers and policymakers to choose health care performance measures. However, it continues to be poorly utilized in the marketplace because of overriding financial imperatives to control costs and a low apparent willingness to pay for quality. There is no obvious relationship between the cost-effectiveness of life-saving interventions and their application. Health care decision makers consider financial impact, safety, and effectiveness before cost-effectiveness. WHY IS CEA NOT MORE WIDELY APPLIED? Most health care providers have a short-term parochial financial perspective, whereas CEA takes a long-term view that captures all costs, benefits, and hazards, regardless of to whom they accrue. In addition, a history of poor standardization of methods, unrealistic expectations that CEA could answer fundamental ethical and political issues, and society's failure to accept the need for allocating scarce resources more judiciously, have contributed to relatively little use of the method by decision makers. HOW WILL CEA FIND GREATER UTILITY IN THE FUTURE? As decision makers take a longer-term view and understand that CEA can provide a quantitative perspective on important resource allocation decisions, including the distributional consequences of alternative choices, CEA is likely to find greater use. However, it must be embedded within a framework that promotes confidence in the social justice of health care decision making through ongoing dialogue about how the value of health and health care are defined.
Technology may soon reduce consumers' need for and use of the most expensive healthcare services, thereby controlling costs and even improving overall health status. It's called the science of 'demand management'.
In Canada, there has been an increasingly, vociferous debate over the future of a health care system which is based on 5 principles: comprehensiveness; public administration; universality; portability; and accessibility. In part, this debate is a policy tug-of-war among provincial governments, special interest groups and the public who on one side want to maintain the principles of the health care system and on the other want to control costs within the system. The outcome of this policy tug-of-war is demonstrated through an analysis of the funding of health care in the province of Ontario, Canada in general, and the closure of hospital beds specifically. The analysis shows that in attempting to restructure the system, rationalization and growing spatial inequality are occurring simultaneously. The analysis calls into question the whole strategy of bed closures as a method of controlling health care costs. These conclusions have implications for other national health care systems where hospital bed closures have also been used as a strategy in controlling health care costs.
In spite of the fact that other service sectors such as airlines, retail banking, telecommunications, railroads, trucking, securities brokerage, and insurance have experienced remarkable transformations toward more deregulated environments, the health care industry continues to be very heavily regulated. This article first examines the major theories and general schools of thought surrounding the concept of regulation in general, followed by an examination of the influence governmental regulations have had on hospitals in particular, specifically as they relate to stimulating competitiveness, efficiencies, and cost control.
Prescription and over-the-counter medications are an important and widely used part of healthcare in Canada. Such drugs represent an increasing proportion of total healthcare expenditures. The objectives of the paper are to examine pharmaceutical expenditures and utilisation in Canada, review the major cost control strategies for pharmaceuticals, and discuss the future issues and challenges for pharmaceutical policy in Canada. Compared with other Organisation for Economic Cooperation and Development (OECD) countries, Canada (until recently) has not been successful in controlling the rate of increase of healthcare expenditures and, more specifically, pharmaceutical costs. The key variables associated with high rates of increase in drug costs relate to increased per capita use of drugs, use of more expensive drugs, and rising prices of existing drugs. If policies are going to address the fundamental societal issues behind both the price and utilisation elements of pharmaceuticals, policy makers and third-party payers in Canada will probably have to focus, primarily, on manufacturers and major healthcare providers and, secondarily, on consumers. They will need to develop an internally valid package of consistent policies.
Recent consolidations by healthcare purchasers and providers in the Minneapolis area have contributed to the demise of the Minnesota Coalition on Health, the 12-year-old consortium of provider, business and consumer groups that was a pioneer in educating healthcare consumers about cost-control strategies. Observers said much of the responsibility for analyzing healthcare services, costs and outcomes is now moving to the marketplace.
Employers' past solutions to rising health benefit costs--adopting managed care strategies, cost shifting to employees and reducing benefits-are no longer effectively controlling costs and are depressing the value of health benefits for employee recruitment and retention. An alternative strategy is to implement health management approaches that improve the health status of employees. These programs reduce medical costs and have a documented positive impact on workers' compensation, disability costs, absenteeism and productivity. Further, this approach is complementary to health care consumerism as a strategy for health improvement and benefit cost reduction and results in improved employee health, outlook and satisfaction.
Studies of the use of laboratory data in cost-control management yield the following conclusions: (1) Comprehensive medical information is a valuable medical resource; (2) problems in practice frequently involve poor data utilization, and difficulties with data acquisition are frequently secondary phenomena; (3) current regulations limiting the acquisition of data may be counterproductive in worsening care while raising costs. If continued, the long-term effects on knowledge generation can be expected to be devastating; (4) good medicine is cost effective; (5) poor medicine is expensive, both in human and economic terms; and (6) good medical care requires a patient-oriented data base, a clinical decision-support system, a feed-back mechanism so that effectiveness of the system may be evaluated on an ongoing basis, and adequately trained medical technology personnel.
The assumption that consumer choice cannot be used to achieve cost control in health care is invalid. It does not do so today because the tax treatment of health care leads to perverse consumer incentives that encourage cost escalation. By reforming the tax treatment of insurance and out-of-pocket medical costs, it is possible to design an efficient and universal system in which consumer choice is a powerful restraint on cost.
The Report of the Pharmaceutical Inquiry of Ontario documented dramatic increases in the cost of the Ontario Drug Benefit (ODB) program. This article demonstrates that the rise in ODB costs for those 65 and over is due to two factors: more intensive prescribing--physicians prescribing to the elderly more often and writing more prescriptions each time they see an elderly patient--and physicians writing prescriptions for more expensive drugs. Neither of these two changes in prescribing behavior has resulted in any demonstrable improvement in the health of the elderly. Efforts to control costs through some form of copayment or by eliminating some drugs from the ODB formulary should not be undertaken since they probably will result in a reduction in the use of medically necessary drugs. Ultimately, drug costs will only be controlled by improving the appropriateness of physicians' prescribing.
This article examines the feasibility of including an all-payer reimbursement system in a universal health care program in the United States. An all-payer system would keep intact the current array of private and public insurers, but would require that they each pay the same price for hospital and physician services. The article concludes that an all-payer system would face far fewer political barriers than a purely government-financed system. Furthermore, it has a number of advantages over the financing schemes currently used, particularly with respect to enhancing access to care and controlling costs. But there are several potential problems: agreeing on a common payment rate; controlling the volume of services provided; devising a way of incorporating alternative delivery systems; and dealing with the issue of whether providers will be able to "balance bill". The extent to which these problems can be solved will, to a large degree, determine whether an all-payer system can live up to its promise.
The prevalence of managed care, integrated delivery systems, and new financing structures is nudging healthcare into a value-driven rather than a cost-controlling market, with a focus on community and improvement. Fueled by increasing demands from healthcare purchasers, consumers, accrediting bodies, and government agencies, providers are escalating their efforts to demonstrate that they offer the highest technical and service quality.
The purpose of this study was to evaluate outpatient rotator cuff repair on the basis of patient satisfaction, pain control, early postoperative complications, and cost control. Patients were considered good candidates for an outpatient repair if they were in good health and had adequate support at home. Seventy-five rotator cuff repairs were performed on an outpatient basis. The average age of the patients was 58 years. Patients with tears smaller than 2 cm in diameter were excluded. Postoperative pain was managed effectively in 74 of 75 outpatients. There were no cases of deltoid origin compromise, deep infection, or early failure of repair, and no outpatient required readmission to the hospital. This study demonstrates that outpatient rotator cuff repair is possible in the appropriately selected patient and can be performed safely and effectively with a 43% reduction in overall cost.
Many physicians assert that new cost-control mechanisms inappropriately interfere with clinical decision-making. They claim that high costs arise from poorly practiced medicine, and argue that effective utilization of resources is best promoted by advancing the scientific and ethical ideals of medicine. However, the claim is not warranted by empirical evidence. In this essay, I show how it rests upon aesthetic considerations associated with diagnostic elegance. I first consider scientific rationality generally. After a review of analytical empiricist and socio-historical approaches in the philosophy of science, a form of Kant's aesthetic is used to explain how scientific discovery and justification are linked, and to show how meta-theoretical considerations associated with the goals and method of science work together with exemplars of practice. This analysis enables us to understand how the ideals of medicine as a science guide the initial patient history and physical exam in such a way that a parsimonious use of tests is indicated. Aesthetic considerations unite the basic scientific and ethical commitments of the modern medical paradigm and are central for rightly understanding clinical judgment.
OBJECTIVE: The treatment of suicidal patients contributes to escalating mental health expenditures. Fiscal realities necessitate that cost-containment measures be implemented wherever possible. The authors reviewed the literature to delineate factors that impede cost containment for the treatment of suicidal patients and to outline strategies for controlling costs while improving the quality of care. METHODS: Psychological Abstracts and MEDLINE databases were reviewed. Retrieval and analysis focused on literature published between 1982 and 1992. RESULTS AND CONCLUSIONS: Five factors unique to the treatment of suicidal patients that impede cost containment were identified: the lack of a specific and cost-effective screening method to determine true risk of suicide, the high number of parasuicidal and malingering patients, revolving-door admissions of involuntary patients who become noncompliant with treatment after discharge, the adverse clinical consequences of further increases in existing discriminatory mental health benefits, and the medicolegal liability incurred in treating suicidal patients. The low frequency of completed suicides in relation to attempts and reported ideation indicates that most inpatients labeled suicidal are hospitalized unnecessarily. Thus inpatient treatment should be reserved for patients who make attempts of high lethality and patients with suicidal ideation who are at high risk because of other factors. Ideally, suicidal patients should be committed not to an inpatient facility but to a treatment network in which they can move appropriately between inpatient, day hospital, and outpatient care.
OBJECTIVE: To evaluate a "Primary Care Self-Management Project" started in 1992. DESIGN: An observational and semi-experimental study with sub-designs: post-test, pretest/post-test with one group, pre-test/post-test with a non-equivalent control group and multiple temporal series. SETTING: An urban area. PARTICIPANTS: The nine Primary Care teams (PCT) in Vitoria-Gasteiz. INTERVENTION: A decentralised budget for self-management was assigned to each PCT, which included Chapter I, staff replacements and Chapter II, Stores, Laboratory, Radiology and Maintenance. MEASUREMENTS AND MAIN RESULTS: 1. Cost control and adjustment of each PCT to the assigned budget. There was an overall saving of 1.8% of the total decentralised budget (96,959,988 pesetas). Six of the nine PCTs fulfilled their assigned budgets. 2. The increase in professional motivation was partially measured by looking at short-term spells off work in the Absence from Work index. In the PCT this index fell 31% from 1991 to 1992, from 4.2 to 2.9%. Among the County's other staff this index remained practically stable, falling only from 5.1 to 4.8%. 3. Higher productivity and better budget use was measured by looking at replacement costs, which went down 7.2% from 1991 to 1992. The proportion of cost arising from replacements for scheduled activities went from 57.9% in 1991 to 39.1% in 1992. CONCLUSIONS: Self-management, at least within the scope of this study, has positive effects on various aspects of the PCTs' work.
The Health USA Act of 1991 addresses two fundamental health services financing problems: the more than 30 million uninsured persons and the rising costs for health care and for health insurance. Health USA would provide coverage of the entire resident population for comprehensive medical and preventive health and long-term care services through a universal tax-funded financing system. The federal government would contribute an average of 87% of program costs to each state, which would establish, under federal guidelines, a state health program. Each individual or family may enroll in any health plan approved by the state program, including many private plans, or a plan run by the state program. Through the approved plan of their choice, enrollees would receive covered services and obtain their care from participating physicians and other professional practitioners, hospitals, and other facilities. The state program would pay approved plans a capitation payment for every person enrolled. The plans would pay professional providers fees, as part of an all-payer system of fee schedules and expenditure targets, or capitation payments or salary. Hospitals would be financed through global budgets negotiated by the state program with each hospital. The plan run by the state program would pay the health care costs of any person who does not enroll in an approved plan, making the state plan the payer of last resort and eliminating uncompensated care and cost shifting by providers. Health USA would separate health care coverage from employment, ensuring uninterrupted coverage and eliminating employers' administrative role in providing coverage. Federal and state taxes would replace present methods of financing by private insurance premiums and large out-of-pocket expenditures. Building on the present system of health plans, Health USA would offer all persons a wide choice of competing plans in which to enroll and offer professional providers a wide choice of plans in which to practice. It would control costs by increasing financial accountability of providers and health plans, reducing present reliance on intrusive utilization review and on patient cost sharing. By controlling health care and administrative costs, Health USA would cover the entire population and, according to independent cost estimates, reduce national health expenditures by $11.5 billion in 1991.