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PubMed2002

Free tissue transfer versus pedicled flap cost in head and neck cancer.

OBJECTIVE: We sought to compare the overall 1-year management costs for patients receiving a free tissue transfer with those of patients receiving a pedicled flap reconstruction as a component of their primary head and neck cancer treatment. STUDY DESIGN AND SETTING: Case-control, cost identification analysis of 21 matched pairs of patients and multivariate analysis of variables associated with treatment costs was conducted in a tertiary referral academic institution. RESULTS: No significant difference in total 1-year charges between the pedicled and free tissue transfer groups was found. A structured measure of patient comorbidity was the only variable significantly associated with total 1-year charges. CONCLUSIONS: Total 1-year treatment costs of primary upper aerodigestive tract cancers are similar for patients reconstructed with free tissue transfer or a pedicled flap. SIGNIFICANCE: Within the context of overall 1-year management costs, the primary determinants of health care expense for these patients are comorbidity and extent of disease, not reconstructive technique.

Alcoholism↗

PubMed2005

Ten years of bovine virus diarrhoea virus (BVDV) control in Norway: a cost-benefit analysis.

A retrospective cost-benefit analysis was carried out on the Norwegian bovine virus diarrhoea (BVD) control and eradication strategy, for the years 1993-2003. Information regarding the control cost input parameters was gathered from the cattle industry (TINE Norwegian Dairies, GENO Breeding and AI association, and GILDE Norwegian Meat), The National Animal Health Authorities and The Veterinary Institute. We accounted for variable costs (both direct costs associated with the control, and those costs carried by the farmers as a consequence of the control program). The benefit was estimated as the difference between the assumed losses without control - represented overall as 10% increase of the observed 1993 BVD virus infection level - and the observed losses during the control period. An estimate of the financial losses associated with the BVD virus (BVDV) infection was based on studies of the herd level effects on health, reproduction, and production in dairy herds with evidence of recent BVDV infection. We used a stochastic simulation model to account for the total uncertainty in both the control cost and financial loss estimates. The annual net benefits over the 10 years of BVD control were discounted to a 1993 net present value (NPV). The median NPV of the BVD control, nationally, was estimated at 130 million NOK with a distribution of the NPV ranging from +51 to +201 million NOK (5th and 95th percentiles, respectively). Out of the total control costs the farmers and the farmer-owned industries (the co-operatives) had carried about 62% of these costs; however, the farmers were also the main beneficiaries. The Norwegian experience shows a robust cost-efficiency for a BVDV eradication strategy; this stands in sharp contrast to earlier studies where the results were not supportive. Even though every cattle population and country is unique, the Norwegian findings and experiences should have wider implications.

Animals↗

PubMed2006

The pervasiveness of pharmaceutical expenditure inertia in the OECD countries.

This paper constructs and estimates an economic model for testing statistically the strength of possible 'expenditure inertia' as a plausible reason for rising drug expenditures of the Organization for Economic Cooperation and Development (OECD) countries. The ethical drugs sector in the OECD health care systems is increasingly targeted as the major culprit in the rising cost. Using multiple regression analysis, and the maximum likelihood estimation method, the data of each country (taken from OECD Health Data, 1997) were first tested for functional form optimality with the Box-Cox power family transformations model. Drug expenditure elasticities, at data means, were computed using each country's optimal regression model estimates. The results indicate that the traditionally fitted a priori limited functional form models (e.g., linear, log-log) are not globally consistent with data across countries. The effect of a one-period lagged real per-capita drug expenditure (capturing inertia or habit persistence) on current period real per-capita prescription expenditure is statistically significant in most countries. Pharmaceutical demands are inelastic, and tend to behave like a necessity, as expected. Since the significant effects of economic, demographic, and other drivers of high drug spending differ across countries, country-specific implications and policy suggestions for cost controls ought to differ.

Aged↗

PubMed1994

State Medicaid pharmacy payments and their relation to estimated costs.

Although prescription drugs do not appear to be a primary source of recent surges in Medicaid spending, their share of Medicaid expenditures has risen despite efforts to control costs. As part of a general concern with prescription drug policy, Congress mandated a study of the adequacy of Medicaid payments to pharmacies. In this study, several data sources were used to develop 1991 estimates of average pharmacy ingredient and dispensing costs. A simulation was used to estimate the amounts States pay. Nationally, simulated payments averaged 96 percent of estimated costs overall but were lower for dispensing costs (79 percent) and higher for ingredient costs (102 percent).

Data Collection↗

PubMed1976

Improving the efficiency of a community mental health agency: an accountant's view.

This paper describes the rules for the proper implementation of a responsibility accounting system in a mental health center. Responsibility accounting, which relates the costs to the functions that authorize their incurrence, is presented as a technique that aids the unit's manager in controlling costs. The article discusses the rules that should be followed for proper cost association, presents a illustrative statement for a mental health center, and discusses some existing practices, such as line--item accounting, that may appear to conform to good responsibility accounting practices but in reality do not.

Accounting↗

PubMed2005

High-volume surgery in developing countries.

BACKGROUND: Cataract remains the world's leading cause of blindness. In the developing world, many eye clinics provide cataract surgery for only a small proportion of those in need. This is partly because of low demand-caused by barriers related to awareness, bad services, cost, and distance--and partly because of deficiencies in the supply of services. This article reviews innovations in cataract surgery in poor countries that are intended to reverse this trend. CONCLUSIONS: Increasing the number of operations, through close involvement with the community, and improved surgical outcomes, enables the cost of surgery to be reduced, leading to further growth in volume. Recent innovations, such as low-cost intraocular lenses, and small-incision extracapsular cataract extraction, have contributed to improving the results of surgery without increasing the costs. Effective management enables the delivery of increasing the numbers of operations, while at the same time improving outcomes and controlling costs.

Cataract Extraction↗

PubMed1997

Costs of care and administration at for-profit and other hospitals in the United States.

BACKGROUND: In fiscal year 1990, administration accounted for 24.8 percent of total hospital costs in the United States - nearly twice the share in Canada. Studies from the 1970s and early 1980s found high costs, especially for administration, at for-profit hospitals. METHODS: We calculated administrative costs for 6227 nonfederal hospitals and the total costs of inpatient care for 5201 acute care hospitals in the United States for fiscal year 1994 on the basis of data the hospitals submitted to Medicare. We analyzed similar data for fiscal year 1990. Using multivariate analysis, we assessed the effect of hospital ownership (private not-for-profit, for-profit, and public) on administrative costs, controlling for hospital type, census region, hospital size, and the proportion of revenues derived from outpatient services. We adjusted inpatient costs for local wage levels, hospitals' reporting periods, and case mix. RESULTS: Administrative costs accounted for an average of 26.0 percent of total hospital costs in fiscal year 1994, up 1.2 percentage points from 1990. They increased by 2.2 percentage points, to 34.0 percent, for for-profit hospitals; by 1.2 percentage points, to 24.5 percent, for private not-for-profit hospitals; and by 0.6 percentage point, to 22.9 percent, for public hospitals. In 1994, administration accounted for 37.5 percent of total costs at psychiatric hospitals (44.4 percent at for-profit hospitals) and 33.0 percent of total costs at rehabilitation hospitals (37.7 percent at for-profit hospitals). In a multivariate analysis, for-profit ownership was associated with a 7.9 percent absolute (34 percent relative) increase in the proportion of hospital spending devoted to administration as compared with public hospitals and a 5.7 percent absolute (23 percent relative) increase as compared with private not-for-profit hospitals. Among acute care hospitals, for-profit institutions had higher adjusted costs per discharge ($8,115) than did private not-for-profit ($7,490) or public ($6,507) hospitals. Much of the difference was due to higher administrative costs ($2,289, $1,809, and $1,432 per discharge, respectively). CONCLUSIONS: Administrative costs as a percentage of total hospital costs increased in the United States between 1990 and 1994 and were particularly high at for-profit hospitals. Overall costs of care were also higher at for-profit hospitals.

Health Services Research↗

PubMed2000

Recruitment strategies and success in a multi-county smoking cessation study.

The current paper focuses on the process evaluation of recruitment strategies and success in a large study of self-help smoking interventions with mid-life and older smokers in a 15-county area. Recruitment 'channels' were examined: (1) multiple paid newspaper advertisements, (2) free media (i.e., TV and radio), (3) referrals, (4) HMO newsletters, (5) targeted mailings, (6) face-to-face, and (7) passive recruitment. Data were analyzed to determine (1) which channels produced the greatest numbers of information requests, or initial 'recruits', and (2) which produced the greatest number of enrolled subjects. Overall, four channels resulted in the enrollment of 96.4% of the final sample of 1972 subjects. The most reliable, cost-controlled channel was paid newspaper advertisements ($18-19 per enrolled subject), while face-to-face recruitment was inefficient and costly (over $140 per subject). Results can be used to help guide other studies in selecting recruitment strategies for large, geographically diverse, smoking intervention trials.

Aged↗

PubMedDate not supplied

Using patient feedback for creating and improving innovative programs.

There are two goals that should be of paramount concern to clinicians today. With the current emphasis on cost control in healthcare, it has become necessary to search for ways to (a) decrease the total burden of illness for costly conditions and (b) compile outcomes data to measure effectiveness and efficiency. This article describes an experimental work therapy program that seeks to address the needs of early-stage Alzheimer's disease and other dementia patients. Feedback from patients and caregivers was used to validate the benefits of the program activities in reducing the total burden of illness. These data also were used as a basis for improving program components. Once the program was well defined, patient and caregiver feedback measures were used to ensure that the program continued to meet their needs.

Alzheimer Disease↗

PubMed1995

Positioning for capitation by redesigning internal processes.

Now that healthcare reform is no longer at the forefront of President Clinton's agenda, competition among providers, practitioners, and health systems will become more common as they ready themselves for capitation. In addition, mergers, consolidations, acquisitions, alliances, and partnerships will continue to reshape the healthcare industry. In order for the parties to be successful in a capitated environment, providers, practitioners, and healthcare systems must manage and adapt to consolidation, capitation, communication, control, cost, customer, capital, and culture.

Capitation Fee↗

PubMed1998

Wall Street comes to Washington: analysts' perspectives on health system change.

Security analysts took a hard look at the latest trends in the health care industry at the third annual Health System Change Wall Street roundtable held earlier this year. The roundtable focused on costs and premiums, evolving financial relationships among industry leaders, industry consolidation and pharmaceutical and technology development. The analysts' conclusions: some market strategies--including vertical integration, provider risk-sharing and equity arrangements and the use of formularies to rein in drug costs--haven't worked out as expected. Health plans and provider organizations have yet to find a magic bullet for controlling costs while responding to purchasers' and consumers' demands for broader choice. This Issue Brief reports on the trends discussed at the roundtable.

Delivery of Health Care↗

PubMed2003

Electronic prescribing: ready for prime time?

Escalating drug expenditures and the prevalence of medication errors have prompted calls for drug cost control and quality improvement. E-prescribing promises to address these concerns. This study aims to describe the benefits and costs of eRx as assessed by key industry stakeholders, identify the components of a needed electronic prescribing infrastructure and the barriers to its completion, and identify potential public and private policies and initiatives that could encourage the development of an EPI and hasten eRx adoption among stakeholders.

Clinical Pharmacy Information Systems↗

PubMed1997

Psychological care can reduce cardiac costs.

Coronary artery disease patients show sure signs of benefiting from psychological counseling. At a time when HMOs have been "carving out" mental health benefits in an effort to control costs, an APA-Mayo model should help force the reintegration of the split.

Coronary Disease↗

PubMed2007

Using comorbidity indexes to predict costs for head and neck cancer.

OBJECTIVE: To determine whether the general Charlson Comorbidity Index (CCI) and the head and neck cancer-specific Washington University Head and Neck Cancer Comorbidity Index (WUHNCCI) were useful for predicting cost of treatment for elderly patients with head and neck cancer. DESIGN: Retrospective, observational study. PATIENTS: A total of 1780 Medicare patients with head and neck cancer, who were treated between 1984 and 1994, were analyzed using the Surveillance, Epidemiology, and End Results (SEER)-Medicare-linked database. MAIN OUTCOME MEASURES: Total Medicare payments were accumulated for each patient up to 1 and 5 years. Linear regression was used to estimate the impact of the comorbidity indexes on costs, controlling for demographics, site, stage, and treatment modality. RESULTS: Neither the WUHNCCI nor the CCI was significantly associated with 1-year costs. However, the effect of the WUHNCCI on 5-year costs was statistically significant (P<.001). A 1-point increase in the WUHNCCI from 4 to 5 was associated with an increase in 5-year costs of $2105. A 1-point increase in the WUHNCCI from 9 to 10 was associated with an increase in 5-year costs of $2837. CONCLUSION: These results suggest that comorbidity indexes for head and neck cancer may be useful for prognostication of patient outcomes and predicting costs.

Aged↗

PubMed1985

Future trends in the economics of medical practice and care.

A revolution is taking place in the American health care industry. The basis for these changes is the rapid escalation of health care costs to nearly 11% of our gross national product. The changes have caused a controversy regarding whether cost containment reduces the quality of medical care. Our present system was built on the premise that the highest quality of health care could be delivered to all fairly and without any form of rationing. This has led to a massive growth in facilities and the number of physicians. In simple economic terms the market factors in the environment should have lowered the cost of care. However, the cost of care has increased even more rapidly than expected. It seems likely that older economic principles must be abandoned to control costs. Price competition, preferred providers and more efficient hospitals must all be encouraged. Overutilization of care must be discouraged by proper incentives, and overpricing by physicians may require fixed cost reimbursement. Two-tiered health care delivery will develop and small segments of the population may receive a lower quality of care. Rationing of care may be a simple alternative.

Delivery of Health Care↗

PubMed2005

Assessment of nursing management and utilization of nursing resources with the RAFAELA patient classification system--case study from the general wards of one central hospital.

BACKGROUND: RAFAELA is a new Finnish PCS, which is used in several University Hospitals and Central Hospitals and has aroused considerable interest in hospitals in Europe. AIMS AND OBJECTIVES: The aim of the research is firstly to assess the feasibility of the RAFAELA Patient Classification System (PCS) in nursing staff management and, secondly, whether it can be seen as the transferring of nursing resources between wards according to the information received from nursing care intensity classification. METHODS: The material was received from the Central Hospital's 12 general wards between 2000 and 2001. The RAFAELA PCS consists of three different measures: a system measuring patient care intensity, a system recording daily nursing resources, and a system measuring the optimal nursing care intensity/nurse situation. The data were analysed in proportion to the labour costs of nursing work and, from that, we calculated the employer's loss (a situation below the optimal level) and savings (a situation above the optimal level) per ward as both costs and the number of nurses. RESULTS: In 2000 the wards had on average 77 days below the optimal level and 106 days above it. In 2001 the wards had on average 71 days below the optimal level and 129 above it. Converting all these days to monetary and personnel resources the employer lost 307,745 or 9.84 nurses and saved 369,080 or 11.80 nurses in total in 2000. In 2001 the employer lost in total 242,143 or 7.58 nurses and saved 457,615 or 14.32 nurses. During the time period of the research nursing resources seemed not have been transferred between wards. CONCLUSIONS: RAFAELA PCS is applicable to the allocation of nursing resources but its possibilities have not been entirely used in the researched hospital. The management of nursing work should actively use the information received in nursing care intensity classification and plan and implement the transferring of nursing resources in order to ensure the quality of patient care. RELEVANCE TO CLINICAL PRACTICE: Information on which units resources should be allocated to is needed in the planning of staff resources of the whole hospital. More resources do not solve the managerial problem of the right allocation of resources. If resources are placed wrongly, the problems of daily staff management and cost control continue.

Activities of Daily Living↗

PubMedDate not supplied

A closer look at case management.

Healthcare organizations throughout the United States are attempting to find solutions to spiraling healthcare costs. Hospital administrators are questioning the cost-effectiveness of their care delivery models, while healthcare professionals are developing innovative measures to increase the cost-effective use of resources. This article explores hospital-based case management measures that are being used not only to control costs but also to de-escalate the continuously accelerating cost increases.

Case Management↗

PubMedDate not supplied

Relative value units and cost analysis, Part 3 of 4.

In recent years, the interest in relative value unit (RVU) cost analysis has been on the rise. Why all the excitement? RVU cost analysis places the knowledge, and therefore the power, in the hands of the administrator to negotiate revenues, analyze expenditures, and control costs. Cost analysis at the per (relative)-unit level allows for procedure profitability (or loss) analysis, setting internal fee schedules based on costs, contract negotiation based on RVU cost and utilization, equitable provider compensation packages based on productivity and overhead coverage, and tracking ancillary and referral utilization risks. In short, RVU cost accounting uses the Resource-Based Relative Value Scale (RBRVS) instead of stopwatches and clipboards when measuring clinical costs and activity.

Costs and Cost Analysis↗