Cost Containment Efforts Research Articles

Cost-consequence analysis of computer vision-based skin prick tests: implications for cost containment in Switzerland

BackgroundSkin prick tests (SPTs), or intraepidermal tests, are often the first diagnostic approach for people with a suspected allergy. Together with the clinical history, SPTs allow doctors to draw conclusions on allergies based on the sensitization pattern. The purpose of this study is to investigate the potential cost consequences that would accrue to a Swiss University hospital after the adoption of computer vision-based SPTs.MethodsWe conducted a cost-consequence analysis from a hospital’s perspective to evaluate the potential cost consequences of using a computer vision-based system to read SPT results. The patient population consisted of individuals who were referred to the allergology department of one of the five university hospitals in Switzerland, Inselspital, whose allergology department averages 100 SPTs a week. We developed an early cost-consequence model comparing two SPT techniques; computer vision-based SPTs conducted with the aid of Nexkin DSPT and standard fully manual SPTs. Probabilistic sensitivity analysis and additional univariate sensitivity analyses were used to account for uncertainty.ResultsThe difference in average cost between the two alternatives from a hospital’s perspective was estimated to be CHF 7 per SPT, in favour of the computer vison-based SPTs. Monte Carlo probabilistic simulation also indicated that SPTs conducted using the computer vision-based system were cost saving compared to standard fully manual SPTs. Sensitivity analyses additionally demonstrated the robustness of the base case result subject to plausible changes in all the input parameters, with parameters representing the costs associated with both SPT techniques having the largest influence on the incremental cost. However, higher sensitization prevalence rates seemed to favour the more accurate standard fully manual SPTs.ConclusionAgainst the backdrop of rising healthcare costs especially in Switzerland, using computer-aided or (semi) automated diagnostic systems could play an important role in healthcare cost containment efforts. However, results should be taken with caution because of the uncertainty associated with the early nature of our analysis and the specific Swiss context adopted in this study.

Is local competition effective in improving quality and efficiency of hospitals? Insights from an asymmetric spatial competition model

A critical aspect of healthcare reforms in various countries revolves around the relationship between efficiency, quality, and competition. Exploring the spatial dimension of competition is essential to understand this connection thoroughly. In this study, we develop a theoretical model that examines hospitals' choices regarding quality and cost-containment efforts across different competitive environments characterized by varying spatial distributions of hospitals. We derive and fully characterize hospitals' reaction functions and Nash equilibria concerning quality and cost-containment efforts. Our findings reveal that while localized competition tends to reduce hospitals' efforts in cost containment, its impact on treatment quality can vary. This variation depends on factors such as the cost of delivering quality care, its benefits to patients, and hospitals' objectives, including their level of altruism. Our findings contribute to the ongoing debate on the role of local competition in healthcare. They offer insights into the conditions that could yield divergent outcomes, often advocated by conflicting perspectives. These conditions serve as a foundation for refining competition policy models in healthcare.

Options to Extend Medicare's Trust Fund: Lessons From Japan's Statutory Health Insurance.

Medicare's Hospital Trust Fund is projected to become insolvent sometime during 2028 and there will be insufficient funds to cover the costs of beneficiaries' care if reforms are not made before then. Many options have been proposed on ways to extend the trust fund's solvency. Some proposals focus on controlling costs and other proposals include options for raising revenues. A fresh perspective on this policy dilemma may arise by considering Japan's statutory health insurance (SHI) and its financing mechanisms. Japan could be a useful model because it has an older population and it is facing similar fiscal challenges before Medicare. Japan could offer some useful perspectives from its cost containment efforts to extend Medicare's solvency.

Patterns of adoption of robotic radical prostatectomy in the United States and England.

To compare patterns of technological adoption of minimally invasive surgery for radical prostatectomy across the United States and England. We examine radical prostatectomy in the United States and England between 2005 and 2017, using de-identified administrative claims data from the OptumLabs Data Warehouse in the United States and the Hospital Episodes Statistics in England. We conducted a longitudinal analysis of robotic, laparoscopic, and open surgery for radical prostatectomy. We compared the trends of adoption over time within and across countries. Next, we explored whether differential adoption patterns in the two health systems are associated with differences in volumes and patient characteristics. Finally, we explored the relationship between these adoption patterns and length of stay, 30-day readmission, and urology follow-up visits. Open, laparoscopic, and robotic radical prostatectomies are identified using Office of Population Censuses and Surveys Classification of Interventions and Procedures (OPCS) codes in England and International Classification of Diseases ninth revision (ICD9), ICD10, and Current Procedural Terminology (CPT) codes in the United States. We identified 66,879 radical prostatectomies in England and 79,358 in the United States during 2005-2017. In both countries, open surgery dominates until 2009, where it is overtaken by minimally invasive surgery. The adoption of robotic surgery is faster in the United States. The adoption rates and, as a result, the observed centralization of volume, have been different across countries. In both countries, patients undergoing radical prostatectomies are older and have more comorbidities. Minimally invasive techniques show decreased length of stay and 30-day readmissions compared to open surgery. In the United States, robotic approaches were associated with lower length of stay and readmissions when compared to laparoscopic. Robotic surgery has become the standard approach for radical proctectomy in the United States and England, showing decreased length of stay and in 30-day readmissions compared to open surgery. Adoption rates and specialization differ across countries, likely a product of differences in cost-containment efforts.

Toward High-Value, Cost-Conscious Care – Supporting Future Doctors to Adopt a Role as Stewards of a Sustainable Healthcare System

Phenomenon: In order to tackle the persistent rise of healthcare costs, physicians as “stewards of scarce resources” could be effective change agents, extending cost containment efforts from national policy to the micro level. Current programs focus on educating future doctors to deliver “high-value, cost-conscious care” (HVCCC). Although the importance of HVCCC education is increasingly recognized, there is a lag in implementation. Whereas recent efforts generated effective interventions that promote HVCCC in a local context, gaps persist in the examination of system factors that underlie broader successful and lasting implementation in educational and healthcare practices. Approach: We conducted a realist evaluation of a program focused on embedding HVCCC in postgraduate education by encouraging and supporting residents to set up “HVCCC projects” to promote HVCCC delivery. We interviewed 39 medical residents and 10 attending physicians involved in such HVCCC projects to examine HVCCC implementation in different educational and healthcare contexts. We held six reflection sessions attended by the program commissioners and educationalists to validate and enrich the findings. Findings: A realist evaluation was used to unravel the facilitators and barriers that underlie the implementation of HVCCC in a variety of healthcare practices. Whereas research activities regularly stop after the identification of facilitators and barriers, we used these insights to formulate four high-value, cost-conscious care carriers: (1) continue to promote HVCCC awareness, (2) create an institutional structure that fosters HVCCC, (3) continue the focus on projects for embedding HVCCC in practice, (4) generate evidence. The carriers support residents, attendings and others involved in educating physicians in training to develop and implement innovative HVCCC projects. Insights: Strategies to promote physician stewardship go beyond the formal curriculum and require a transformation in the informal educational system from one that almost exclusively focuses on medical discussions to one that also considers value and cost as part of medical decision-making. The HVCCC carriers propose a set of strategies and system adaptations that could aid the transformation toward a HVCCC supporting context.

Healthcare Demand under Simple Prices: Evidence from Tiered Hospital Networks

This paper shows that consumers respond to prices for complex healthcare when they can easily assess out-of-pocket prices. Healthcare cost containment efforts increasingly incentivize price shopping despite a dearth of evidence that this steers consumers toward lower-priced care for major medical services. I show that consumers shift toward lower-priced hospitals in the highly simplified price information environment of insurance plans with tiered hospital networks. Consumers observe a single predictable, well-defined price that applies to a broad range of services within each of at most three hospital tiers. Within three years, expected partial-equilibrium savings reach 8–17 percent of baseline spending. (JEL G22, H75, I11, I13)

Triage in the Nation's Medicine Cabinet: The Puzzling Scarcity of Vaccines and Other Drugs

For a variety of reasons, vaccines and other critical pharmaceutical products have become increasingly scarce in the last few years, and persistent shortages involving dozens of essential drugs may imperil the public health. Pressures emanating from regulatory agencies, the courts, and insurers have conspired to make some lines of the pharmaceutical business less than attractive. Although concerns about unpredictable tort liability received most of the blame in the past, two other factors may help to account for the latest round of drug shortages: stringent federal control of manufacturing facilities and aggressive cost-containment efforts that further erode profit margins. Whatever the cause, scarce supplies necessitate efforts at rationing that pose their own difficulties for health care providers. Policymakers could avoid putting physicians to such tough choices regarding patients by focusing on ways to ensure the production of adequate quantities of these highly cost-effective medical technologies. Some commentators have called for greater public sector involvement, but this Article concludes that, in addition to bolstering its emergency stockpiles, the federal government instead needs to take steps designed to encourage private manufacturers to continue supplying critical pharmaceuticals. To this end, the government should adopt more flexible regulations governing manufacturing facilities, provide companies with greater protection from the vagaries of tort liability, and avoid pursuing excessive cost-control strategies. Otherwise, patients may continue to lose access to important therapeutic products.

Environmental and Organizational Factors Associated with Hospital Use of GPO Services

Given the potential benefits of Group Purchasing Organizations in cost-containment efforts for hospitals on supplies and purchased services, an important question that remains unanswered is what conditions support or hinder the utilization of GPOs by hospitals. Therefore, this study explores the relationship between GPO use by hospitals and their market and organizational characteristics. Data on hospital GPO utilization and other organizational characteristics were combined with secondary hospital market characteristics. Panel logistic regression with random effects and state and year fixed effects analysis was used to examine the relationship between hospitals’ utilization of GPO services and hospitals’ organizational and market characteristics. Overall, the majority of hospitals utilized the services of GPOs. Specifically, the number of hospitals utilizing the services of GPOs increased slightly from 3290 (72.2%) in 2004 to 3337 (74.4%) in 2013. In regression analyses, hospitals utilizing the services of GPOs operated in an external environment with mixed levels of munificence, more dynamism, and less competition. Specifically, hospitals operating in a less munificent environment are more likely to utilize the services of GPOs. The study findings provide organizational decision-makers and policymakers’ insights into how certain market and organizational factors influence hospital strategy choice, in this case, the use of GPOs.

Hospital and Surgeon Medicare Reimbursement Trends for Total Joint Arthroplasty.

BackgroundOver 1 million total joint arthroplasties (TJAs) are performed every year in the United States, creating Medicare cost concerns for policy makers. The purpose of this study is to evaluate recent trends in Medicare utilization and reimbursements to hospitals/surgeons for TJAs between 2012 and 2017.MethodsWe tracked annual Medicare claims and payments to TJA surgeons using publicly available Medicare databases and aggregated data at the county level. Descriptive statistics and multivariate regression models were used to evaluate trends in procedure volume, utilization (per 10,000 Medicare beneficiaries), and reimbursement rates and to examine associations between county-specific variables and TJA utilization and reimbursements.ResultsBetween 2012 and 2017, there was an 18.9% increase in annual primary TJA volume (357,500 cases in 2012 to 425,028 cases in 2017) and a 2.0% increase in annual primary TJA per capita utilization (73.4 cases per 10,000 Medicare beneficiaries in 2012 to 74.8 in 2017). The Midwest and the South had higher utilization rates compared with the Northeast and West (P < .001). Utilization rates for primary TJA procedures also had a significant negative association with the poverty rate (P < .001). Medicare Part B payments to surgeons fell by 7.5%, equivalent to a 14.9% inflation-adjusted decline, whereas hospital reimbursements and charges increased by 0.3% and 18.6%, respectively, during the study period.ConclusionsDespite increasing TJA volume and utilization, surgeon reimbursements have continued to decline, whereas hospital payments and hospital charges have increased significantly more than surgeon charges. Cost containment efforts will need to address other expenditures such as hospital costs and implant costs to better align financial risks and incentives for TJA surgeons.

Recent trends in Medicare utilization and surgeon reimbursement for shoulder arthroplasty

Recent efforts to contain health care costs and move toward value-based health care have intensified, with a continued focus on Medicare expenditures, especially for high-volume procedures. As total shoulder arthroplasty (TSA) volume continues to increase, especially within the Medicare population, it is important for orthopedic surgeons to understand recent trends in the allocation of health care expenditures and potential effects on reimbursements. The purpose of this study was to evaluate trends in annual Medicare utilization and provider reimbursement rates for shoulder arthroplasty procedures between 2012 and2017. This study tracked annual Medicare claims and payments to shoulder arthroplasty surgeons via publicly available databases and aggregated data at the county level. Descriptive statistics were used to evaluate trends in procedure volume, utilization rate(per 10,000 Medicare beneficiaries), and reimbursement rate. We used adjusted multiple linear regression models to examine associations between county-specific variables (ie, urban or rural, average household income, poverty rate, percentage Medicare population, and race and ethnicity demographics) and procedure volume, utilization rate, and reimbursement rate. Between 2012 and 2017, there was an 81.3% increase in primary TSA volume and 55.5% increase in primary TSA utilization. The Midwest and South had higher utilization rates than the Northeast and West (P < .001). TSA utilization rates in metropolitan areas were significantly higher than in rural areas (P < .001). Utilization rates for primary TSA procedures also had a significant negative association with poverty rate (P < .001). Regarding reimbursements, the Medicare payment per TSA case decreased from 2012 to 2017, with overall inflation-adjusted decreases of 7.1% and 11.8% for primary and revision cases, respectively. TSAs performed in metropolitan areas received significantly higher reimbursements per case than TSAs performed in rural areas ($1108.05 and $1066.40, respectively; P = .002). Furthermore, reimbursements per case were on average higher in the Northeast and West than in the South and Midwest (P < .001). Our study confirms that although TSA volume and per capita utilization have increased dramatically since 2012, Medicare Part B reimbursements to surgeons have continued to fall even after the adoption of bundled-payment models for orthopedic procedures. Cost-containment efforts continue to focus on Medicare reimbursements to surgeons, although other expenditures such as hospital payments and operational and implant costs must also be evaluated as part of an overall transition to value-based health care.

Do financial incentives matter? Effects of Medicare price shocks on skilled nursing facility care.

Skilled nursing facility (SNF) spending has been one of the fastest growing categories of Medicare spending over the past few decades, and reductions in SNF payments are often recommended as part of Medicare cost containment efforts. Using a quasi-experiment resulting from a policy-driven and facility-specific Medicare payment change, we provide new evidence on how Medicare payment changes affect the amount of SNF care provided to Medicare patients. Specifically, we examine a one-time, plausibly exogenous change in the hospital wage index, an area-level adjustment to SNF payments that affected the majority of SNFs nationwide. Using a panel dataset of SNFs, we model the effects of these payment changes on more than 12,000 SNFs across the United States. We find that increases in Medicare payment rates to SNFs increased the total number of Medicare resident days at SNFs. Specifically, a 5% payment increase raised Medicare resident days by 2.33% at facilities with a 10% Medicare share relative to 0%. Further, the effects were asymmetric: Although Medicare payment increases affected Medicare days, payment decreases did not. Our results have important implications for policies that alter the Medicare base payment rates to SNFs and other health care providers.

The States as Important Laboratories for Federal Prescription Drug Cost-Containment Efforts

This Viewpoint proposes ways states can control the costs of expensive drugs produced by single manufacturers, including importation from other countries, international benchmark pricing, and statewide upper payment limits.

Hot Spotting as a Strategy to Identify High-Cost Surgical Populations.

The aim of this study was to determine the feasibility of "hot spotting" in elective surgical populations. Prospective identification of high-cost patients, known as "hot spotting," is well developed in medical populations, but has not been performed in surgical populations. Population-based management of surgical expenditures requires identification of high-cost surgical patients to allow for effective implementation of cost-saving strategies. Using 100% Medicare claims data for 2010 to 2013, we identified patients aged 65 to 99 years undergoing elective surgical procedures. We calculated price-standardized Medicare payments for the surgical episode from the index admission through 30 days after discharge. Patient-level factors associated with payments were analyzed by multivariable linear regression. Medicare patients in the highest decile of spending accounted for a disproportionate share of aggregate costs: 30% in Colectomy (COL), 22% in coronary artery bypass grafting (CABG), 19% in Total Hip Arthroplasty, and 18% in Total Knee Arthroplasty. Medicare expenditure differences between the highest and lowest deciles were because of a 5-fold difference for COL and 3-fold difference for CABG in index hospitalization cost. In contrast, for orthopedic procedures, there were 47- to 80-fold post-acute care expenditures between highest and lowest deciles. In multivariable analyses, patients with ≥3 comorbidities had significantly higher costs than healthier patients. We found that a subset of multimorbid patients was responsible for a disproportionate share of total Medicare spending, but the individual components of spending vary by procedure. These findings suggest that targeting high-cost Medicare patients (ie, hot spotting) for cost containment efforts would be a potentially effective strategy to reduce costs in surgical populations.

Identifying Potentially Avoidable Hospitalizations in Medicare Patients With Prostate Cancer: A Retrospective Analysis.

If identifiable, potentially avoidable hospitalizations (PAHs) can serve as an important target for cost containment efforts in oncology. PAHs among a cohort of Medicare patients with prostate cancer were identified using a two-stage consensus-driven review process. In stage 1, two clinicians independently evaluated admissions records using a case review form, which we modified from a previous study to assess for PAHs. In stage 2, any admissions that the reviewers disagreed on or were unsure of were re-examined in a larger group of clinicians to yield a consensus determination regarding avoidability. Univariable and multivariable regression analyses were performed to identify factors predictive of PAH. There were 160 admissions among this cohort of 210 patients from January 2012 to June 2015, of which 99 were evaluable. Consensus-driven clinical review yielded an overall PAH rate of 28.3%. Factors associated with increased PAH risk were admission for symptoms related to cancer (odds ratio [OR], 7.33; P < .001), presence of a social contributor to admission (OR, 4.40; P = .014), and history of alcohol or drug abuse (OR, 4.93; P = .025). Admission for a noncancer condition was associated with decreased PAH risk (OR, 0.32; P = .011). On multivariable analysis, presence of a social contributor to admission (OR, 9.35; P = .002) and admission as a result of a noncancer condition (OR, 0.16; P = .038) remained predictive of PAH risk. A significant proportion of hospitalizations among patients with prostate cancer are potentially avoidable. Understanding factors predictive of risk for PAH can help inform programs aimed at avoiding such admissions to improve overall care quality and value.

Provider Perspective in the Health Care Economics of Lower-Limb Prosthetic Rehabilitation

ABSTRACT Health care economic science holds great potential for improving the quality of lower-limb prosthetic care. To realize this potential, health care providers need to adopt an outlook that economic analysis is not strictly limited to the scrutiny of cost, but includes a better understanding of the value generated in the provision of lower-limb prostheses. Health care providers in the United States currently have a negative perception of cost containment efforts implemented by regulators to rein in health care spending. The United States currently spends more on health care than any other developed country (17.9% of GDP; National Health Expenditure Projections 2017–2026. Centers for Medicare and Medicaid Services; 2017), whereas other countries have reduced cost and increased quality of care through health care economic science. The clinical outcome of restoring mobility and independence to a person with lower-limb amputation has an appreciable impact on quality of life. By measuring the quality improvement and comparing costs associated with available lower-limb prosthetic alternatives, health care economic science can improve decision making regarding the best use of resources and improve the overall value of care. Although limited economic evidence exists concerning lower-limb prostheses, a better understanding of the purpose of health care economic science can lead health care providers to contribute to the economic research that is needed.

Insuring patient access and affordability for treatments for rare and ultrarare diseases: a policy statement of the American College of Medical Genetics and Genomics

Insuring patient access and affordability for treatments for rare and ultrarare diseases: a policy statement of the American College of Medical Genetics and Genomics

Managing acute cholecystitis among Medicaid insured in New York State: opportunities to optimize care.

Identifying sources of unnecessary cost within Medicaid will help focus cost containment efforts. This study sought to identify differences in surgical management and associated costs of cholecystitis between Medicaid and privately insured in New York State. The New York State all-payer mandatory discharge database from 2003 to 2013, had297,635patients with Medicaid (75,512) and privately (222,123) insurancewho underwent cholecystectomy for cholecystitis. Patients were stratified by insurance. Four surgical management approaches were delineated based on cholecystectomy timing: primary, interval, emergency, and delayed cholecystectomy. Delayed cholecystectomy was defined as more than one hospital visit from diagnosis to definitive cholecystectomy. Medicaid and privately insured patients were propensity scorematched. Surgical management approach and associated costs were compared between matched cohorts. A greater proportion of Medicaid patients underwent delayed cholecystectomy compared to matched privately insured patients, 8.5 versus 4.8%; P<0.001. Primaryinitial cholecystectomy was performed in fewer Medicaid compared to privately insured patients, 55.4 versus 66.0%, P<0.001. Primaryinitial cholecystectomy was the cheapest surgical management approach, with the median cost of $3707, and delayed cholecystectomy was the most expensive, $12,212, P<0.001. The median cost per Medicaid patient was $6170 versus $4804 per matched privately insured patient, P<0.001. The annual predicted cost savings for New York State Medicaid would be $13,097,371, if the distribution of surgical management approaches were proportionally similar to private insurance. Medicaid patients with cholecystitis were more frequently managed with delayed cholecystectomy than privately insured patients, which had substantial cost implications for the New York Medicaid Program.

Patient perspectives on emergency department self-referral after bariatric surgery

BackgroundReducing avoidable emergency department (ED) visits is an increasingly important target of quality improvement and cost containment efforts in bariatric surgery. Administrative and clinical registry data provide an incomplete picture of the factors contributing to postoperative ED utilization. Patient-centered interviews can help identify intervention opportunities. ObjectivesWe sought to understand the circumstances surrounding patient self-referral to the ED after elective, primary bariatric surgery. SettingA quality improvement collaborative in Michigan. MethodsA prospective review of clinically abstracted data and patient interviews was completed across 40 hospitals participating in a statewide quality improvement collaborative. Trained nurses collected data on the circumstances surrounding patients’ 30-day postoperative ED visits using a previously validated interview tool. Over a year, 201 of 633 total ED visits met the inclusion criteria, with 78% of those patients being interviewed. ResultsThe most common reported chief complaints were abdominal pain and nausea/vomiting. Patients reported high compliance with provider-driven perioperative measures to reduce ED visits. One third of patients stated urgency as the reason for not contacting their surgeon prior to their visit. A majority of patients believed their ED visit was both necessary and unavoidable. ConclusionsMost patients experienced non-life-threatening symptoms but believed their concerns required immediate medical attention in an ED. Patients did not seek lower acuity alternatives despite the increasing availability of these lower cost options. Urgent care centers are one practical alternative for patients who need expeditious professional evaluation. Focused, patient-centered education and promotion of appropriate lower acuity options may decrease nonurgent ED utilization among postoperative bariatric patients.

Intensive care unit drug costs in the context of total hospital drug expenditures with suggestions for targeted cost containment efforts

PurposeTo assess costs of intensive care unit (ICU) related pharmacotherapy relative to hospital drug expenditures, and to identify potential targets for cost-effectiveness investigations. We offer the unique advantage of comparing ICU drug costs with previously published data a decade earlier to describe changes over time. Materials and methodsFinancial transactions for all ICU patients during fiscal years (FY) 2009–2012 were retrieved from the hospital's data repository. ICU drug costs were evaluated for each FY. ICU departments' charges were also retrieved and calculated as percentages of total ICU charges. ResultsAlbumin, prismasate (dialysate), voriconazole, factor VII and alteplase denoted the highest percentages of ICU drug costs. ICU drug costs contributed to an average of 31% (SD 1.0%) of the hospital's total drug costs. ICU drug costs per patient day increased by 5.8% yearly versus 7.8% yearly for non-ICU drugs. This rate was higher for ICU drugs costs at 12% a decade previous. Pharmacy charges contributed to 17.7% of the total ICU charges. ConclusionsGrowth rates of costs per year have declined but still drug expenditures in the ICU are consistently a significant driver in this resource intensive environment with a high impact on hospital drug expenditures.

Emotional labour and governmentality: Productive power in childcare

This article examines the interplay between governance and cost-containment efforts in the public sector and the emotional labour and well-being of childcare workers. Care-work researchers have highlighted the complexities of power in emotional labour, such as the fact that emotional labour may simultaneously benefit the individual worker and reproduce inequalities that may be detrimental to workers’ well-being. The goal of this article is to develop a theoretical understanding of power in emotional labour and to show how power is related to emotional labour not only in terms of lack of control, status and resources, but also productively in terms of the subjectivities enabled by organisations. The article draws on the works of Foucault and Rose, particularly the concepts of productive power and governmentality, and suggests that emotional labour may be conceptualised as a technology of the self. The potential benefits of governmentality and productive power in terms of connecting emotional labour to larger structures are illustrated by qualitative interviews with Danish childcare workers, which show how emotional labour may become a form of self-governance that contributes to the individualisation of work-related responsibilities.