Provision Of Hospital Services Research Articles

New Zealand's health providers in an emerging market

Services have almost completely replaced hospitals as the organisational units in the reformed New Zealand health care system. Within the secondary service provider sector service management, the decentralisation of general management to budget-holding clinical groupings has been an important factor in achieving a population focus, cost containment, accountability and integration. It is being further developed within the 23 newly formed Crown health enterprises (CHEs), the main providers of secondary, hospital and related services. The CHEs are evolving roles beyond a narrow definition of ‘providers’, taking initiatives to collaborate with other providers, or rejecting those elements of competition that might interfere with effective local co-ordination of services. Service management is also being extended to the demand-driven, fee-for-service primary care sector, where inflation-adjusted expenditure over the last decade has grown at more than 6%, compared with zero growth in the capitation-financed secondary sector. This is being achieved in both general practice and community budget-holder groupings through what might be called managed primary health care. The current health reform process has also created four regional health authorities (RHAs), responsible, within capped and capitated budgets, for the fully integrated purchasing of services from both primary and secondary providers. The success of these innovative arrangements, which could be of international significance, will depend upon the quality of the developing relationships between providers and their purchasing RHAs.

Commentary and translation: 1994 nutrition recommendations for diabetes

Commentary and translation: 1994 nutrition recommendations for diabetes

Managing the health care market in developing countries: prospects and problems.

There is increasing interest in the prospects for managed market reforms in developing countries, stimulated by current reforms and policy debates in developed countries, and by perceptions of widespread public sector inefficiency in many countries. This review examines the prospects for such reforms in a developing country context, primarily by drawing on the arguments and evidence emerging from developed countries, with a specific focus on the provision of hospital services. The paper begins with a discussion of the current policy context of these reforms, and their main features. It argues that while current and proposed reforms vary in detail, most have in common the introduction of competition in the provision of health care, with the retention of a public monopoly of financing, and that this structure emerges from the dual goals of addressing current public sector inefficiencies while retaining the known equity and efficiency advantages of public health systems. The paper then explores the theoretical arguments and empirical evidence for and against these reforms, and examines their relevance for developing countries. Managed markets are argued to enhance both efficiency and equity. These arguments are analysed in terms of three distinct claims made by their proponents: that managed markets will promote increased provider competition, and hence, provider efficiency; that contractual relationships are more efficient than direct management; and that the benefits of managed markets will outweigh their costs. The analysis suggests that on all three issues, the theoretical arguments and empirical evidence remain ambiguous, and that this ambiguity is attributable in part to poor understanding of the behaviour of health sector agents within the market, and to the limited experience with these reforms. In the context of developing countries, the paper argues that most of the conditions required for successful implementation of these reforms are absent in all but a few, richer developing countries, and that the costs of these reforms, particularly in equity terms, are likely to pose substantial problems. Extensive managed market reforms are therefore unlikely to succeed, although limited introduction of particular elements of these reforms may be more successful. Developed country experience is useful in defining the conditions under which such limited reforms may succeed. There is an urgent need to evaluate the existing experience of different forms of contracting in developing countries, as well as to interpret emerging evidence from developed country reforms in the light of conditions in developing countries.

Paying for efficiency: what price the quality of hospital care?

Economic recession prompts governments and health service ministers to seek increased efficiency in the production of hospital services in order to reconcile increasing demands with scarce resources. As one approach to the problem, the National Health Strategy is recommending pilot schemes, similar to those which have been introduced in both the United Kingdom and the Netherlands, which involve the separation of purchaser from the provider of hospital services. It is argued that such separation, with the introduction of competition between providers of hospital services for contracts placed by publicly funded Area Health Boards, will increase efficiency and accountability in the use of resources. However, this argument ignores the hospital management's ability to keep costs down by altering the quality of hospital care in ways which are difficult to monitor by purchasing agencies. The article considers the effects the introduction of managed competition is likely to have on the quality of hospital services. The outcome is uncertain and competition may improve some dimensions of quality while jeopardizing others. If managed competition is tried in Australia, the opportunity should also be taken to examine its impact on the quality and outcomes of hospital care.

Allocative Inefficiency in the Production of Hospital Services

Researchers have offered numerous theoretical models of hospital behavior that suggest inefficiency in the provision of hospital services.' Explanations of inefficiency are tied to the organization and regulation of the industry, principal-agent problems, and the dominance of third-party reimbursement. Eakin and Kniesner [3] use a non-minimum cost function to obtain estimates of allocative inefficiency for 331 U.S. short-term hospitals. In this paper, I fill a void in the hospital cost literature by investigating variations in allocative inefficiency in the short-term hospital industry. This is done by regressing the allocative inefficiency estimates from Eakin and Kniesner against hospital characteristics predicted by theory as determinants of inefficiency. I define allocative inefficiency at the firm level, but from a social point of view. Specifically, allocative inefficiency results from the technically efficient employment of inputs in a combination which is not cost-minimizing. A hospital may choose a non-cost-minimizing set of inputs if it evaluates the shadow prices of inputs as being different from the actual prices. A shadow price is the hospital's internal perception of the unit cost of an input. This perception may differ from the actual input price if, for example, the input enters directly into the hospital's objective function. The hospital is assumed to minimize shadow cost by equating the marginal rate of technical substitution and the ratio of input shadow prices. Thus, it is the shadow cost function that is dual to the underlying technology. The hospital is modelled as a multiproduct firm. A modified translog cost function is used to develop a system of observed cost and share equations which is estimated via seemingly unrelated non-linear regressions. Empirical results indicate that overcapitalization and underemployment of physicians increase short-term hospital costs by about 5 percent. Hospital care expenditures are about 4.5 percent of the gross national product, which is almost three times the percentage in 1960. Thus, 5 percent represents a large amount in actual dollars. Further investigation identifies hospital size, market share, regulations and geographic region as the hospital characteristics related to the measure of allocative inefficiency. This paper is organized as follows. In section II, I develop the empirical model based on a non-minimum cost function. The traditional minimum cost function is a special case and thus

A Proposal to Redistribute the Cost of Hospital Charity Care

Policy analysts debate whether providers of hospital services should share the responsibility of financing care for those who cannot pay for it. Many nonprofit and public hospitals, meanwhile, find it necessary to fund some of the services they deliver. A proposal to redistribute the costs of charity care more equitably is offered, taking into account the benefits an institution receives and its ability to pay. Hospitals would be required to quantify the charity care they provide and to make this information publicly available; in reviewing the information, legislatures are encouraged to set priorities on how much unmet need each state and each hospital should finance.

Volume and outcome in hospital care: evidence, explanations and implications.

The relationship between the volume of work undertaken in a hospital and the outcome of care has assumed increasing importance in recent years. A review of the literature reveals that most studies have been carried out in the USA and have largely been confined to six specific areas of health care. There is evidence that better outcomes are obtained at higher volumes for several surgical operations, cardiac catheterisation and care of the severely injured. As yet there is no clear association for coronary, neo-natal and burn care. There are two competing hypotheses to explain any association -- 'practice-makes-perfect' and 'selective referral'. These are discussed and implications for the future provision of hospital services considered.

Providing hospital services: the changing financial environment

Providing hospital services: the changing financial environment

Managing physician efficiency and effectiveness in providing hospital services.

Physicians control more than 80 percent of the decisions affecting health costs. Consequently, managing physician practice patterns is an important avenue to reducing health care costs. One approach to identifying inefficient practice patterns is demonstrated in this pilot study of physicians treating heart shock patients. Physicians are evaluated using data envelopment analysis (DEA), a relatively new linear-program-based efficiency evaluation tool. This approach (1) locates physicians using excess resources in treating patients, (2) estimates the amount of excess resources used, and (3) explicitly considers the quality of patient care in the overall assessment of the physician's practice patterns. Findings of physician inefficiency that are stable over time could be used to alter practice patterns and subsequently to assist in cost containment.

Families' experiences in psychiatric emergencies.

Sixty families from three self-help, psychoeducational groups in western New York State were interviewed about their experiences during recent psychiatric emergencies involving their mentally ill relatives. Twenty-six hospital-based emergency mental health service providers were compared with the families on key attitudes toward emergency services. Families reported that emergencies were complicated and traumatic and that they involved contacts with numerous agencies, sometimes over several months. Satisfaction with the emergency service system was generally low among both families and hospital service providers. Service providers were less likely than families to believe that families' assessments of their ill relatives' need for treatment were credible. The author suggests that apparently "crazy" behavior of families may make sense in the context of serious patient pathology and a general lack of emergency assistance. Much effort is needed to develop coordinated emergency mental health treatment that is sensitive to families' needs.

The Effect of the Medicare Prospective Payment System

In 1965, the enabling legislation for the Medicare program mandated that hospitals be reimbursed for the reasonable costs they incurred in providing services to Medicare beneficiaries. During the first 15 years of the program, hospital payments (which make up about 71 % of all Medicare payments) increased at an annual rate of approximately 15.4% (94). Most of the increase in payments was due to the increasing costs of providing hospital services. The federal policy of retrospective cost reimbursement was an important factor contributing to that explosion in hospital costs (56, 61, 96). In response to the increase in program costs, in 1982 Congress passed the Tax Equity and Fiscal Responsibility Act (TEFRA), which made major changes in Medicare's hospital reimbursement policy. The two most impor­ tant features of this change were (a) a limit was placed on the allowable (reimburseable) rate of increase in the cost per hospital discharge, and (b) the concept of case-mix was incorporated into the reimbursement system. The following year, the Congress passed the Social Security Reform Act, which established a prospective payment system for hospitals under the Medicare program (PPS). The basic features of PPS are as follows:

Third Party Influences Upon Provision of Psychological Service in Hospitals

This symposium identifies various third party agencies, examines how their interaction reciprocally affects hospital policies and practices, and assesses their potential impact upon future provision of psychological services in hospitals and the relationships between mental health care providers. Emphasis is placed upon maintaining a holistic systems perspective that recognizes the need to establish an integrated multidisciplinary coalition to inform, educate and influence third party payers, policyrnakers, providers, patients and the public.

Hospital service for young adults with spina bifida and hydrocephalus.

Developments in surgical treatment for spina bifida and hydrocephalus during the '60s means that there is now a large group of severely disabled young people and adults with increasing and special problems. A survey was therefore carried out by ASBAH between October 1981 and October 1982 into the provision of hospital services for young people with spina bifida and hydrocephalus when they became too old for paediatric services, and especially into the system of transfer to adult provision. 370 questionnaires were returned out of 3,000 sent out. The information acquired related to the number and variety of hospitals attended, the type of medical supervision and the problems encountered in seeking treatment and advice. The indications are that specialist treatment and understanding are not available except in very few cases. Examples of current practice in the UK and abroad are cited and some conclusions drawn as to possible solutions.

Sounding board. New approaches to using the determination-of-need process to contain hospital costs.

Staggering increases in the costs of providing hospital services have prompted a closer scrutiny of state cost-containment mechanisms. Two such mechanisms that exist in many state regulatory arsena...

Hospital organisation and structure and its effect on inter-professional behaviour and the delivery of care

Some form of organisation within and between hospitals is necessary to provide effective and integrated care to patients, to ensure that medical, nursing and paramedical services develop efficiently and coherently, and to ensure that needs of the community are met. However research into the design of structures for the provision of hospital services has been remarkably limited considering the transformation of hospital work in recent decades. The absence of clearly articulated models of organisation and lack of consensus on the relevant data make needed comparative studies difficult to mount. Nevertheless systematic empirical and evaluative studies of matters like appropriate limits to authority, working of intraprofessional hierarchies, management of clinical autonomy, and the effects of interprofessional rivalry on patient-care seem both feasible and desirable. Many studies bearing directly on these topics take the form of inquiries mounted within government departments or by professional groups with an interest in the outcome.

A Model to Assist Planning the Provision of Hospital Services

A Model to Assist Planning the Provision of Hospital Services

A model to assist planning the provision of hospital services.

One of the most important health service issues concerns the level of provision of acute hospital beds. To assist resolution of this issue a model is proposed which simulates how hospital beds are used in terms of admission rates and lengths of stay for different categories of disease. The model can be used to predict the likely effects of changes in the provision of beds. Thus if it is proposed to increase the supply of beds, the model will estimate, by disease type, how much of an increase this will cause in admission rates and lengths of stay. The ability of the model to make reasonably accurate predictions is demonstrated by testing it with hospital data from Quebec Province, Canada. Some ways of improving the model's predictive power are discussed and possible future applications to hospital policy issues are outlined.

Productivity in the Provision of Hospital Services: A Challenge to the Management Community

Productivity in the Provision of Hospital Services: A Challenge to the Management Community

Productivity in the Provision of Hospital Services: A Challenge to the Management Community

Productivity improvement has a role in holding down escalating costs of hospital services. A research model is developed for obtaining higher levels of productivity and quality in hospital departments. A challenge is issued to the management community for more research on hospital productivity.

The Scope of Medical Statistics

In surveying the applications of statistics to medicine, Mr. Bailey deals with subjects of general interest: the use of medical records, the making of efficient arrangements for providing hospital services, and the testing of the efficacy of medical treatments, as well as with the specialist subjects of epidemiology, the efficiency of techniques of medical investigation, and medical genetics. The article is based on a paper given at a conference of the Royal Statistical Society held in Cambridge in September 1951.