Growth Of Health Care Expenditures Research Articles

Two decades of change in European general practice service profiles: conditions associated with the developments in 28 countries between 1993 and 2012

Objective: Evidence regarding the benefits of strong primary care has influenced health policy and practice. This study focuses on changes in the breadth of services provided by general practitioners (GPs) in Europe between 1993 and 2012 and offers possible explanations for these changes. Design: Data on the breadth of service profiles were used from two cross-sectional surveys in 28 countries: the 1993 European GP Task Profile study (6321 GPs) and the 2012 QUALICOPC study (6044 GPs). GPs’ involvement in four areas of clinical activity (first contact care, treatment of diseases, medical procedures, and prevention) was established using ecometric analyses. The changes were measured by the relative increase in the breadth of service profiles. Associations between changes and national-level conditions were examined though regression analyses. Data on the national conditions were used from various other public databases including the World Databank and the PHAMEU (Primary Health care Activity Monitor) database. Setting: A total of 28 European countries. Subjects: GPs. Main outcome measure: Changes in the breadth of GP service profiles. Results: A general trend of increased involvement of European GPs in treatment of diseases and decreased involvement in preventive activities was observed. Conditions at the national level were associated with changes in the involvement of GPs in first contact care, treatment of diseases and, to a limited extent, prevention. Especially in countries with stronger growth of health care expenditures between 1993 and 2012 the service profiles have expanded. In countries where family values are more dominant the breadth in service profiles decreased. A stronger professional status of GPs was positively associated with the change in first contact care. Conclusions: GPs in former communist countries and Turkey have increased their involvement in the provision of services. Developments in Western Europe were less evident. The developments in the service profiles could only to a very limited extent be explained by national conditions. A main driver of reform seems to be the changes in health care expenditure, which may indicate a notion of urgency because there may be a pressure to curb the rising expenditures. Key pointsBroad GP service profiles are an indicator of strong primary care in a country. It is expected that developments in the breadth of GP service profiles are influenced by various national conditions related to the urgency to reform, politics, and means.Between 1993 and 2012 the involvement of GPs in European countries in treatment of diseases increased and their involvement preventive activities decreased.The national conditions were found to be associated with changes in GPs’ involvement as first contact of care, treatment of diseases, and, to a limited extent, prevention.More specifically, in countries with a stronger growth in health care expenditures, service profiles of European GPs have expanded more in the past decades.

Projecting a Long Term Expenditure Growth in Healthcare Service: A Literature Review

Abstract The upsurge and control of healthcare expenditure growth are becoming a thought-provoking issue for numerous governments globally in spite of the fact that health is one of the superseding fundamentals of physical condition. Nevertheless, with the growing rate of an ageing population and increasing prolonged health difficulties, the protection of the quality of life demands better health spending on the part of the government. Generally, there are huge variances on the dimensions of monetary obligation nations dedicate to health. In this regard, this paper aims to project a long-term expenditure growth in health care service as it is believed that the outcome of this paper will contribute and suggest a policy direction to the government and concern organizations on the effective management of healthcare system.

Building the Foundation for a Successful Medicare Shared Savings Program

Healthcare reform is moving full steam ahead, buoyed by early results that include an increase in the number of people insured, a flattening in the rate of growth of healthcare expenditures and Medicare per capita costs, and an increase in the number of participants in Medicare and commercial value-based programs. The growth in the number of Medicare Shared Savings Programs (MSSPs) and Medicare accountable care organizations (ACOs) has continued to increase in 2015. More than 400 MSSPs now provide services to more than 7 million Medicare beneficiaries. The early results show that a minority of MSSPs (24%, starting in 2012 and 2013, 26% in 2014) (Centers for Medicare & Medicaid Services [CMS], 2015b) have produced shared savings, while the majority of MSSPs have yet to achieve shared savings (CMS, 2014). Other initiatives that have catalyzed the movement to value-based reimbursement and increased the interest in MSSPs include the following: Congress has replaced the Sustainable Growth Rate legislation with the Medicare Access and CHIP Reauthorization Act of 2015 by an overwhelming bipartisan vote. U.S. Department of Health and Human Services Secretary Burwell has increased both the speed of implementation and the number of available Medicare value-based payment models (CMS, 2015a). Commercial payers have set targets similar to the CMS targets to convert provider payment arrangements to value-based payment arrangements.

The fiscal gap: An estimate for Russia

Abstract The fiscal gap is an indicator of the long-term balance of public finance and is calculated based on the intertemporal government budget constraint, which links government tax revenues and expenditures over long intervals. The estimate of the fiscal gap for the Russian general government has been determined according to three scenarios with varying assumptions regarding demographic trends, productivity growth rates, oil and gas prices and the quantity of extractable reserves. The calculations show that the current fiscal policy cannot provide for the stability of public finance in the long run. The main factors of budget imbalances are the growth of pension and health care expenditures caused by demographic trends and the gradual decline in tax receipts from the oil and gas sector.

Health Care Spending: Historical Trends and New Directions

Over the past five decades, broad changes in the US health care system have dramatically influenced growth in health care expenditures. This review identifies the salient factors driving the growth of medical expenditures and how they influenced the trajectory of health economics research. We find that the research identified—and was strongly influenced by—four eras of expenditure growth: period 1, coverage expansion; period 2, experimentation with financial incentives; period 3, the managed care backlash; and period 4, a golden era of declining expenditure growth. We conclude by discussing some themes from this research suggesting optimism that, going forward, we can curb excess expenditure growth above GDP growth without harming population health.

Constraining Innovation

Constraining Innovation

Allied health: integral to transforming health.

Objective South Australia is taking an innovative step in transforming the way its healthcare is organised and delivered to better manage current and future demands on the health system. In an environment of transforming health services, there are clear opportunities for allied health to assist in determining solutions to various healthcare challenges. A recent opinion piece proposed 10 clinician-driven strategies to assist in maximising value and sustainability of healthcare in Australia. The present study aimed to seek the perspectives of allied health clinicians, educators, researchers, policy makers and managers on these strategies and their relevance to allied health. Methods A survey of allied health practitioners was undertaken to capture their perspectives on the 10 clinician-driven strategies for maximising value and sustainability of healthcare in Australia. Survey findings were then layered with evidence from the literature. Results Highly relevant across allied health are the strategies of discontinuation of low value practices, targeting clinical interventions to those getting greatest benefit, active involvement of patients in shared decision making and self-management and advocating for integrated systems of care. Conclusions Allied health professionals have been involved in the South Australian healthcare system for a prolonged period, but their services are poorly recognised, often overlooked and not greatly supported in existing traditional practices. The results of the present study highlight ways in which healthcare services can implement strategies not only to improve the quality of patient outcomes, but also to offer innovative solutions for future, sustainable healthcare. The findings call for concerted efforts to increase the utilisation of allied health services to ensure the 'maximum value for spend' of the increasingly scarce health dollar. What is known about the topic? In medicine, clinician-driven strategies have been proposed to minimise inappropriate and costly care and maximise highly appropriate and less expensive care. These strategies were developed based on clinical experiences and with supporting evidence from scientific studies. What does this paper add? Major changes to the health system are required to slow down the growth in healthcare expenditure. This paper describes opportunities in which allied health practitioners can implement similar strategies not only to improve the quality of patient outcomes, but also to offer cost-effective solutions for a sustainable healthcare. What are the implications for practitioners? Allied health practitioners can provide solutions to healthcare challenges and assist in the transformation of healthcare in Australia. However, for this to happen, there should be concerted efforts to increase recognition of and support for the use of allied health services.

How Business Cycles Affect the Healthcare Sector: A Cross-country Investigation.

The long-term relationship between the general economy and healthcare expenditures has been extensively researched, to explain differences in healthcare spending between countries, but the midterm (i.e., business cycle) perspective has been overlooked. This study explores business cycle sensitivity in both public and private parts of the healthcare sector across 32 countries. Responses to the business cycle vary notably, both across spending sources and across countries. Whereas in some countries, consumers and/or governments cut back, in others, private and/or public healthcare buyers tend to spend more. We also assess long-term consequences of business cycle sensitivity and show that public cost cutting during economic downturns deflates the mortality rates, whereas private cut backs increase the long-term growth in total healthcare expenditures. Finally, multiple factors help explain variability in cyclical sensitivity. Private cost cuts during economic downturns are smaller in countries with a predominantly publicly funded healthcare system and more preventive public activities. Public cut backs during contractions are smaller in countries that rely more on tax-based resources rather than social health insurances. Copyright © 2015 John Wiley & Sons, Ltd.

The Role of Chronic Disease, Obesity, and Improved Treatment and Detection in Accounting for the Rise in Healthcare Spending Between 1987 and 2011

To curb rising healthcare expenditures in the U.S.A., the factors underlying this growth must be well understood. We aim to explore how chronic disease prevalence, obesity, and improved disease detection and treatment rates contributed to the growth in health spending in the U.S.A. between 1987 and 2011. We use spending decomposition equations to estimate the portion of spending growth attributable to prevalence increases, rising treatment costs, and population growth, respectively. We use two-part models to estimate the portion of prevalence-related spending that is potentially due to obesity. We examine changing diagnosis and treatment rates to assess how much of the growth in spending might be desirable. We find that the share of total healthcare spending associated with the treatment of chronic disease has risen dramatically from 1987-2011. In particular, we estimate that 77.6% of healthcare spending growth is attributable to patients with four or more chronic conditions. We find that rising obesity levels may explain between 11.4 and 23.5% of the increase in healthcare expenditure for several specific chronic conditions. Diagnosis and treatment rates for chronic disease are improving. Individuals with multiple chronic conditions are disproportionately responsible for rising healthcare expenditure. Much of spending growth associated with rising rates of chronic disease can be linked to rising obesity rates. Though much of the growth in spending is generally considered undesirable, disease detection and treatment rates are also rising, suggesting that at least some of the recent growth in healthcare expenditure may be beneficial.

An Updated Assessment of Utilization of Interventional Pain Management Techniques in the Medicare Population: 2000 – 2013

Background: The rapid increase in the prevalence of chronic pain and disability, and the explosion of interventional pain management associated health care costs are a major concern for our community. Further, the increasing utilization of numerous modalities of treatments in managing chronic pain, continue to escalate at a pace which may not be sustainable. There are multiple regulations in place to control the growth of health care expenditures which seem to have been largely ineffective. Among the various modalities utilized in managing chronic pain, interventional techniques have shown a significant increase in their utilization in the face of continued debate with respect to the accuracy of diagnostic interventions and the efficacy of therapeutic interventions. Objective: To update and assess the utilization of interventional techniques in chronic pain management in fee-for-service Medicare population. Study Design: An updated analysis of the growth of interventional techniques in managing chronic pain in fee-for-service Medicare beneficiaries from 2000 through 2013. Methods: The data were derived and analyzed utilizing the Centers for Medicare and Medicaid Services (CMS) Physician Supplier Procedure Summary Master Data from 2000 through 2013. Results: From 2000 through 2013, in fee-for-service Medicare beneficiaries, the overall utilization of interventional techniques services increased 236% at an annual average growth of 9.8%, whereas the per 100,000 Medicare population utilization increased 156% with an annual average growth of 7.5%. During this period, the US population increased 12% with an annual average increase of 0.9%, whereas those above 65 years of age increased 27% with an annual average increase of 1.9%. Total Medicare beneficiaries increased 31% with an annual average increase of 2.1%, with an overall increase of 64% for those above 65 years of age, an increase of 26%, constituting 17% of the US population in 2013. The overall increases in epidural and adhesiolysis procedures were 165% compared to 102% per 100,000 fee-for-service population with annual average increases of 7.8% and 5.6%. Facet joint and sacroiliac joint injections increased 417% for services with an annual average increase of 13.5%, whereas the rate per 100,000 fee-for-service Medicare beneficiaries increased 295% with an annual average increase of 11.1%. Limitations: Limitations of this assessment include the lack of inclusion of participants from Medicare Advantage plans, lack of appropriate available data for state-wide utilization, and potential errors in documentation, coding, and billing. Conclusion: This update once again shows a significant increase in interventional techniques in feefor-service Medicare beneficiaries from 2000 through 2013 with an increase of 156% per 100,000 Medicare population with an annual average increase of 7.5%. During this period the Medicare population increased 31% with an annual average increase of 2.1%. Key words: Chronic pain, chronic spinal pain, interventional pain management, interventional techniques, epidural injections, facet joint interventions, sacroiliac joint injections

Health and economic growth in high-income countries revisited: evidence from an augmented production function for the period 1980–2009

This paper uses time series data for seven industrialized countries from 1980–2009 to explore the causality between health care expenditure (HCE) and economic growth. We have set up a classical Cobb–Douglas production function including HCE, labor, capital, and an augmented function additionally including the number of patent applications (as a proxy for technology and research) and the total number of tertiary education students (as a proxy for education). Our results show that there is a long-run relationship between growth and HCE. As regards causality, in the classical production function, evidence for mutual causality between GDP and HCE is noted only in France, Germany and England, causality from HCE to GDP is noted in Italy and Japan, while no causality whatsoever is evidenced in Canada and USA. However, a completely different situation is unveiled when the augmented production function is used with mutual causality being noted in all perused variables. The novelty of our study lies first in that it contributes to the health-growth nexus literature for high-income countries which has been quite controversial and second it sets off new variables whose omission might be one of the reasons of the result dichotomy. Results of this study will be very useful for high-income countries currently afflicted by the economic crisis and embark on HCE curtailments or revisions.

The evolution of Taiwan’s National Health Insurance drug reimbursement scheme

BackgroundThe rapid growth of health care expenditures, especially pharmaceutical spending, is a challenge for many countries. To control increasing pharmaceutical expenditures and to enhance rational use of drugs, Taiwan’s National Health Insurance drug reimbursement system has evolved over time since its introduction in 1995. This study reviewed Taiwan’s drug reimbursement scheme: its development and evolution in the last two decades, and implications and impacts of recent policies for drug pricing. We also provide recommendations for possible improvement.MethodsWe conducted a review of Taiwan’s National Health Insurance drug reimbursement scheme. We focused on three major components of the scheme: (i) the scope of drug coverage; (ii) pricing system for pharmaceuticals under the scheme; and (iii) adjustment of drug reimbursement prices. We reviewed the literature and public policy documents.ResultsThe National Health Insurance delisted 176 and another 240 behind-the-counter products (e.g., antacids, vitamins) between 2005 and 2006 to reduce pharmaceutical expenditures. For the pricing of pharmaceuticals, policy evolution can be divided into four phases since 1995; the present system emphasizes stakeholder engagement, health technology assessment, domestic R&D, and improving quality of products. To close the gap between drug reimbursement prices and procurement prices, eight rounds of drug price surveys and adjustments have been implemented since 2000.ConclusionsTaiwan’s National Health Insurance drug reimbursement scheme has evolved substantially over time to provide more equitable and affordable access to prescription medicines. However, more work is still needed as irrational difference in reimbursement and procurement prices persists and the total expenditure of the drug reimbursement scheme continues to increase at unsustainable rates.

Health Care Expenditure and Economic Growth in SAARC Countries (1995–2012): A Panel Causality Analysis

The aim of this paper is to investigate the relationship between health care expenditure (HCE) and economic growth and to the causality between HCE and economic growth in the selected South Asian Association for Regional Cooperation (SAARC) countries by employing the Panel cointegration and panel causality analysis over the period 1995–2012. Per capita income, labor force, literacy rate, and elderly population of age 65 and above are used an independent variables, as these variables are considered as main indicator of human and physical capital. For examining the time series properties of the data and long run relationships between HCE and economic growth, the panel unit root and panel cointegration tests are employed. The panel Dynamic Ordinary Least Squares (DOLS) method is used to estimate long run parameters, whereas the Seemingly Unrelated Regression (SUR) method is employed to estimate the short run parameters. For the panel causality among HCE and per capita GDP, a new technique developed by Dumitrescu and Hurlin (2012) is used. The results reveal that income elasticity of HCE is less than unity in the long run as well as in the short run. Furthermore, there is an evidence of unidirectional causality running from per capita GDP to HCE in the South Asian countries in the short run. Two-way causation between per capita GDP, labor force, literacy rate, and elderly population of age 65 and above is also observed. We also found two-way causality between labor force, elderly population of age 65 and health care expenditure.

Reexamining the red herring effect on healthcare expenditures

Considerable prior research argues that time to death, not population aging, explains the growth of healthcare expenditures. The objective of this study is to shed light on this debate by presenting new evidence on the red herring hypothesis. This study adopts quantile regression analysis to reexamine variations of the red herring effect on healthcare expenditures in Taiwan over the period 2005–2009. Findings show that population aging estimates decrease from positive to negative along quantiles for the whole sample and become insignificant across most quantiles for the subsample of people aged 65 and over. For whole sample and subsample of people aged 65 and over, proximity-to-death coefficients are significantly positive in most quantiles. Moreover, time-to-death estimates show a substantial upward trend towards date of death. In particular, quarters one and two prior to death produce a significant positive impact on healthcare expenditures at the highest healthcare expenditure quantiles. The new empirical evidence from this study provides a more complete picture of the red herring effect on healthcare expenditures.

Party Politics, Governors, and Healthcare Expenditures

This study examines the impact of gubernatorial partisanship on the growth of healthcare expenditures (HCE) for a panel dataset of 50 U.S. states over the 1991–2009 period. Using the parametric regression discontinuity design, I find no partisan effect on the growth of state's per capita real total personal HCE. However, an analysis of the growth rates of the components of HCE suggests that there is a causal effect of party affiliation on the “prescription drugs” component. These findings are robust to the inclusion of additional covariates in the parametric approach as well to the use of the non‐parametric regression discontinuity approach. The results further suggest that the impact of gubernatorial partisanship does not depend on the length of the governor's term in office.

Robust determinants of health care expenditure growth

Our aim is to disclose robust explanatory variables for health care expenditure (HCE) growth by introducing to this field of research a method that is especially well suited for situations of ‘model uncertainty’: the Extreme Bounds Analysis (EBA). We analyse data for 33 OECD countries over the period 1970–2010 and include – as far as it is statistically feasible – all macroeconomic and institutional determinants of HCE growth in the EBA that have been suggested in the literature. Furthermore, we analyse to what extent outliers in the data influence the results. Our results confirm earlier findings that GDP growth and a variable representing Baumol’s ‘cost disease’ theory emerge as robust and statistically significant determinants of HCE growth. Depending on whether or not outliers are excluded, we find up to six additional robust drivers: the growth in expenditure on health administration, the change in the share of inpatient expenditure in total health expenditure, the (lagged) government share in GDP, the change in the insurance coverage ratio, the growth in land traffic fatalities and the growth in the population share undergoing renal dialysis.

Risk adjustment in aging societies.

BackgroundIn Switzerland, age is the predominant driver of solidarity transfers in risk adjustment (RA). Concerns have been voiced regarding growing imbalances in cost sharing between young and old insured due to demographic changes (larger fraction of elderly >65 years and rise in average age). Particularly young adults aged 19–25 with limited incomes have to shoulder increasing solidarity burdens. Between 1996 and 2011, monthly inter generational solidarity payments for young adults have doubled from CHF 87 to CHF 182, which corresponds to the highest absolute transfer increase of all age groups.ResultsBy constructing models for age-specific RA growth and for calculating the lifetime sum of RA transfers we investigated the causes and consequences of demographic changes on RA payments. The models suggest that the main driver for RA increases in the past was below average health care expenditure (HCE) growth in young adults, which was only half as high (average 2% per year) compared with older adults (average 4% per year). Shifts in age group distributions were only accountable for 2% of the CHF 95 rise in RA payments.Despite rising risk adjustment debts for young insured the balance of lifetime transfers remains positive as long as HCE growth rates are greater than the discount rate used in this model (3%). Moreover, the life-cycle model predicts that the lifetime rate of return on RA payments may even be further increased by demographic changes.Nevertheless, continued growth of RA contributions may overwhelm vulnerable age groups such as young adults. We therefore propose methods to limit the burden of social health insurance for specific age groups (e.g. young adults in Switzerland) by capping solidarity payments.ConclusionsTaken together, our mathematical modelling framework helps to gain a better understanding of how demographic changes interact with risk adjustment and how redistribution of funds between age groups can be controlled without inducing further selection incentives. Those methods can help to construct more equitable systems of health financing in light of population aging.Electronic supplementary materialThe online version of this article (doi:10.1186/s13561-014-0007-5) contains supplementary material, which is available to authorized users.

Theoretical and empirical analysis of the supplier induced demand in health care market in China

Purpose – The purpose of this paper is to provide theoretical model about supplier-induced demand (SID) in health care market in China. Then, an empirical analysis will also be carried out according to the theoretical model above. At last, some advices will be provided in order to control or eliminate the SID in Chinese health care market. Design/methodology/approach – SID has in fact been one of the most contentious topics in the economics of health care. According to the SID theory in health economics, the theoretical model about SID in China has been provided, then, based on the co-integration theory, the empirical analysis has been brought out. Findings – The study tells that it is the reduction of government finance to hospital, not the increase of supply that is the long-term steady determinants of growth of health care expenditure and that the difference of marginal return to hospital among all kinds of services and medicines is the external factor. Originality/value – To provide theoretical model about SID in health care market in China is the main originality value.

The Impact of GDP on Health Care Expenditure: The Case of Italy (1982–2009)

Italian health care expenditure (HCE) has been basically explained with two main groups of theories. (1) Those explaining the peculiarity of the HCE growth as depending on demand and supply factors, such as aging population, number of practising physicians per capita, mix of public and private hospitals, number of hospital beds,… (2) Those explaining the growth of total public expenditure as a common feature among industrialized countries, with a huge empirical literature emphasising the role of GDP and/or other structural/institutional variables as the main determinants of HCE across countries. In order to reassess previous findings, we exploit recent results on panel cointegration analysis and test the regional Italian data on HCE and GDP, also taking into account cross-section correlation. The results show that HCE and GDP are cointegrated. The long- and short-term dynamics of HCE are estimated. Our results, providing an empirical support for the existence of Wagner’s law, have important policy implications in terms of fiscal sustainability: as income rises, people will choose relatively more HCE. Given the level of the public debt in Italy, any further increases would imply that future government spending may be mainly directed toward debt servicing, likely at the expense of public expenditure on basic infrastructure.

Population aging and growth of health care expenditures

Population aging and growth of health care expenditures