Managing Medicaid.
State medicaid officials are eager to take advantage of cost control techniques offered by managed care health plans. But advocates for medicaid patients oppose the easing of safeguards against possible abuses.
Cost Control↗
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My brother's gatekeeper.
When doctors launch their own managed care ventures, they soon find that cost control means care control. And in policing their own, they must resort to the techniques used by other health plans--gatekeepers and all.
American Medical Association↗
Clinical pathways for the high-risk patient.
The goal of managed health care is to reduce health care costs while maintaining or improving the quality of care given to patients. Clinical pathways, which outline the services and therapies planned for a typical patient admitted with a specific diagnosis, may provide a way to control costs and improve patient outcome. These pathways are under development by medical centers and managed-care organizations nationwide, with the aim of planning, managing, documenting, and evaluating multidisciplinary care. A coordinated care plan can take a number of approaches. Time lines identify predictable clinical landmarks and time intervals for a specific medical episode or illness within a given diagnostic-related group or set of diagnostic-related groups. Case-management plans and case managers coordinate a patient's care throughout an episode, eg, an operation, enabling patients to reach defined time points in the course of their care at the expected time. Critical pathways are the favored method of documenting the patient's progress according to the predicted time schedule. This report discusses ways to successfully implement a care plan, highlighting the commitment and effort needed from a multidisciplinary staff to achieve the goal of optimizing efficiency and quality of patient care.
Case Management↗
How expenditure caps and expenditure targets really work.
Every organized payment system must contain its costs in order to keep within revenue without denying benefits. Fixed expenditure caps requiring the provider to operate within its annual financial grant can be imposed on organizations like hospitals, but are fiercely resisted by the medical profession. All financial arrangements with doctors are negotiated, including systems of fixed expenditure caps and more flexible expenditure targets. If the doctors accept the principle of caps and cooperate in achieving them, they do so only as part of a negotiated settlement to avoid a worse outcome. Government's power is minimized, even when government is the payer. Caps on the physicians' sector are unusual. Instead, we see the spread of flexible targeting systems, wherein cost overruns are compensated for by lower expenditure targets the following year. Medical associations in all countries resisted even these restraints for years, but eventually accepted them, provided that target setting, judgments of overruns, utilization control, and all other features are part of a joint negotiating system. Targeting systems are often complicated because they preserve the semiprivate character of statutory health insurance and they are the result of negotiated compromises. To succeed in controlling costs, they require the cooperation of the medical association and of the rank-and-file doctors--but they can succeed. The United States has enacted a small-scale targeting system for Medicare physician payments alone. It cannot become the method for universal health insurance, which must heed lessons from abroad. Only an all-payer system can cover an entire population and contain the costs of the system. A few government officials cannot dictate and implement expenditure goals, but a system of consultation is required for setting and carrying out targets. Impartial officials can regulate hospitals according to the guidelines produced by the consultations, but the record of the medical profession in the countries reviewed here is that they insist on negotiating the final rules and rates. Americans have become bewitched by the mirage of econometric formulas automatically governing a sector, but the real problem is to devise and operate a harmonious decision-making system.
Canada↗
State policy on long-term care for the elderly.
In the thirteen Assessing the New Federalism states, strategies to control the rate of increase in long-term care spending are extremely varied, especially in comparison with acute care's single-minded focus on managed care. States use three broad strategies: offsetting state spending with increased private and federal contributions, making the delivery system more efficient, and using traditional cost-control mechanisms, including controlling the nursing home bed supply and cutting Medicaid reimbursement rates.
Aged↗
What states are doing to control health insurance costs.
Like other employers, state governments are struggling with continued health care cost increases. A 50-state survey reveals that these large public employers are actively attempting to control the cost of their plans while ensuring quality and a commitment to their employees' overall good health.
Cost Control↗
Reinhardt on reform. Interview by Donna Vavala.
Almost since the federal government took its giant step into health care delivery and financing in 1965 with Medicare and Medicaid, the emphasis in Washington has been on reducing the costs of health care. Almost all federal health law subsequent to those two programs has been aimed at cost control, even when the titles of the bills promised a more noble purpose. The most notable exception is the law establishing end-stage renal disease coverage, but it has become a prime exacerbator of rising costs. Not even the designers of the federal programs envisioned how quickly health care costs would rise and how substantial the increases would be. The federal tab in 1993 was $280.6 billion. In 1960, it was $3 billion and in 1970 it was $17.8 billion. And overall health care costs have followed a similar curve, growing from 5.3 percent of the U.S. GDP in 1960 and 7.4 percent in 1970 to 13.8 percent in 1993. The end is not in sight. Economists are predicting growth to 18 percent of GDP by the next century. Uwe E. Reinhardt, PhD, James Madison Professor of Political Economics in the Woodrow Wilson School at Princeton University, does not believe that the "bite" will become that large, but he does expect increases to continue into the near future. In the interview recorded in this article, Professor Reinhardt assesses both the current and his predicted financial scenario for the health care field.
Cost Control↗
Can money and morality mix in medicine?
The escalation of health care costs in the United States has become a problem now that business and taxpayers are paying larger shares of these costs. Many believe that the only way to cope with rising costs is to institute explicit rationing of access to health care services. Proposals to ration based upon age, "sin" exclusions, physician gatekeeper incentives, patient ability to pay, and community values all have shortcomings. An alternative approach to controlling costs that emphasizes efficiency by cutting administrative and malpractice overhead costs and universally providing those medical services that have proven patient benefit is proposed. Physicians must take a more active role in the debate to ensure that patient needs are met and that expenditures are directed toward effective therapies.
Cost Control↗
Study indicates mixed cost containment-efficiency results from PPS implementation.
The prospective Payment System (PPS) has put the nation's hospital industry at extreme risk of financial failure and closure. With the PPS in effect, hospital incentives changed from Medicare reimbursement maximizers to the development of programs and the implementation of organization changes which would control cost and encourage efficiency. Specifically, the Federal Government wanted to reduce or at least maintain at a constant level their cost for the Medicare program.
Cost Control↗
Economics of managed care in spinal cord injury.
OBJECTIVE: To determine and describe trends in economic variables related to the care of individuals with spinal cord injury (SCI) and significant changes in these trends coincident with major developments in medical care cost control. DATA SOURCES: Data from the National Spinal Cord Injury Statistical Center (NSCISC) database were used to review the economic trends in SCI management from 1973 to 1998 and their relation to managed care and other health care cost-containment measures. A panel of SCI health care specialists was interviewed to determine the appropriate data variables to be reviewed. The Shepherd Center Care Health Management Program, Atlanta, GA, is presented as an example of a fiscally successful managed care program for patients with SCI. DATA EXTRACTION: Data from the NSCISC database for the years studied were extracted and converted to a form suitable for analysis by means of the statistical software SAS. DATA SYNTHESIS: Statistical techniques included multiple regression analysis, logistic regression analysis, and model selection methods. CONCLUSIONS: Trends in economic variables, in the care of individuals with SCI show changes coincident with the introduction of Diagnostic Related Groups (DRGs) and managed care as models for provider reimbursement. Significant changes occurred in acute care charges, rehabilitation charges, length of stay, rehospitalization 1 year postinjury, time from injury to admission to a Model System, and discharges to a nursing home.
Cost Control↗
Treat the causes, not the symptoms of the health care cost problem.
The design of the American health care system is guaranteed to create an inflationary spiral. A third party payment system combined with cost-based reimbursement of hospitals, fee-for-service payments to physicians, tax deductible health insurance premiums, and a litigious society that also demands more services have created a growing sense of urgency that something must be done to control costs. Medicare's experience with prospective pricing and use of coordinated care has helped change the incentives that lead to higher costs. Greater use of such approaches shows promise but proposals to impose rigid expenditure caps could create what is tantamount to a pressure cooker unless the underlying incentives are changed.
Centers for Medicare and Medicaid Services, U.S.↗
Universal access to health care. A comprehensive tax-based approach.
More than 30 million Americans lack health insurance, and millions more are "underinsured." Meanwhile, the cost of health care in the United States is escalating, and some of our care is of questionable value. This article presents a health care reform strategy that addresses these three fundamental problems in the US health care system. The strategy, designed to empower consumers to make cost-conscious health care choices, combines a universal tax credit that enables all Americans to purchase basic health coverage; insurance reforms including pooling and reinsurance mechanisms; requirements that all employers make insurance available to their employees and that all consumers purchase coverage; and efforts to measure and improve the quality and efficiency of health care services. This strategy would help us to achieve universal health insurance coverage, while creating the proper incentives for cost control. In addition, it can be largely internally financed through savings automatically triggered by its implementation.
Cost Control↗
A cost analysis of nalbuphine versus meperidine used in oral surgery procedures.
Cost control is of primary importance to the oral surgeon in private practice. Fifty-six patients, 26 receiving nalbuphine (10 mg IV) and 30 receiving meperidine (50 mg IV), were included in a comparative evaluation of recovery-room costs. The two treatment groups were comparable with respect to the surgical procedures performed, the quantity of ancillary sedation used, and the analgesic effectiveness of the two study medications. However, there were marked differences between treatment groups for two characteristics: length of time in the recovery room was more than 50% greater and the nursing time required per patient was 35.3% greater in the meperidine group than in the nalbuphine group. Cost analysis indicated that nalbuphine is more cost-effective than meperidine if recovery-room nursing staff salaries exceed $16,000 per year.
Adolescent↗
The impact of social norms and economic requirements on the strategic marketing of managed care organizations.
The trend in managed care is toward an increased emphasis on cost containment mechanisms. However, many people have begun to argue that cost controls are being implemented at the expense of the provision of appropriate care. By focusing on the impact of societal values on the performance of MCOs, it is argued that MCOs need to focus their marketing efforts on championing cost-cutting efforts in areas that do not impact the quality of care provided, while at the same time, implementing a marketing campaign aimed at promoting their conformity to prevailing social norms.
Attitude to Health↗
Defederalizing Medicaid: fair to the poor, fair to taxpayers?
This paper explores the access and equity implications to the poor and taxpayers of further defederalizing Medicaid program administration. New data on enrollees and tax incidence indicates little horizontal, let alone vertical, equity in the system. Styles of cost control are also examined, showing a systematic bias towards providers and taxpayers at the expense of the poor in penurious states.
Cost Control↗
Healthcare foodservice report 1993. Getting ready for reform. Interview by Mitchell Schechter.
Hospital foodservice directors & dietitians are facing the greatest challenge of their careers -- to prepare, along with their institutions, for the most thoroughgoing reform of America's healthcare system ever proposed. Healthcare institutions across the country are seeking the means to offer enhanced patient services & gain competitive advantages by forming new alliances, new patient-centered care systems & cost-reduction programs. To aid in these efforts, their foodservices are developing comprehensive cross-training schemes, inter-departmental teams with other service groups & new ways to cut operating subsidies. Here's how five hospital foodservice departments are using cost controls, revenue building, quality management processes & enhanced efficiencies to help their institutions prepare for the changes ahead.
Cost Control↗
Reconciling two solitudes: the example of physicians and managers in Ontario's hospitals.
This paper describes five aspects of the traditional relationship of physicians to hospitals and their administrators which fail to facilitate cost control or quality assurance. Several significant obstacles to changing this relationship are described, including the inertia of tradition, the fallacy of costless care and the chasm between medical and management cultures. It argues that to achieve care which is both cost-efficient and of high quality, physicians and hospital managers must unite to pursue common goals in a well-integrated management structure. Five suggestions for developing an effective new relationship are made, including the adoption of a "social contract" for all hospitals, the integration of physicians into hospital management and quality assurance programs, improved patient-level data collection and obligatory cost-awareness programs for hospital physicians.
Cost Control↗
Purchasing premixed products.
When comparing the cost of a product that requires labor-intensive manufacturing processes (e.g., IV admixtures) with the cost of the same product in a ready-to-use form (e.g., premixed, small-volume, parenteral drugs), all costs and potential savings associated with both forms of the product must be taken into consideration. An additional consideration in determining whether finished products should be purchased requires an analysis of the savings achieved in the pharmacy department in relation to the hospital's cost-reduction strategy. Little purpose would be served if the pharmacy pursued options that benefited only the pharmacy but not the hospital in general. It is time that all hospital departments challenge their staffs to maximize their efforts not only to control costs, but to reduce them as well. The greatest yield in the hospital pharmacy is derived through efforts directed at reducing supply expenditures. One reduction method worthy of analysis is use of premixed, small-volume, parenteral drugs. If it can be shown that the overall cost reduction will result from a decrease in waste, clinical pharmacy intervention through the pharmacy and therapeutics committees, targeted drug programs, quality assurance activities, and reduced operating expenses associated with premixed products, their acquisition price can be justified.
Cost Control↗