Reduce Health Spending Research Articles

Multiyear budgets and fiscal performance: Panel data evidence

In the last two decades more than 120 countries have adopted a multiyear budget process (Medium-Term Framework, or MTF) that enables the central government to set multiyear fiscal targets. This paper analyzes a newly-collected dataset of worldwide MTF adoptions during 1990–2008. It exploits within-country variation in adoption in a dynamic panel framework to estimate MTFs' impacts on aggregate as well as sectoral measures of fiscal performance. We find that on average multiyear budgeting improves budget balance by about 2 percentage points with more advanced MTF phases having a larger impact. Higher-phase MTFs also reduce health spending volatility, while only the top-phase MTF has a measurable impact on health sector technical efficiency.

Scope-Of-Practice Laws For Nurse Practitioners Limit Cost Savings That Can Be Achieved In Retail Clinics

Retail clinics have the potential to reduce health spending by offering convenient, low-cost access to basic health care services. Retail clinics are often staffed by nurse practitioners (NPs), whose services are regulated by state scope-of-practice regulations. By limiting NPs' work scope, restrictive regulations could affect possible cost savings. Using multistate insurance claims data from 2004-07, a period in which many retail clinics opened, we analyzed whether the cost per episode associated with the use of retail clinics was lower in states where NPs are allowed to practice independently and to prescribe independently. We also examined whether retail clinic use and scope of practice were associated with emergency department visits and hospitalizations. We found that visits to retail clinics were associated with lower costs per episode, compared to episodes of care that did not begin with a retail clinic visit, and the costs were even lower when NPs practiced independently. Eliminating restrictions on NPs' scope of practice could have a large impact on the cost savings that can be achieved by retail clinics.

Legal and Political Competitiveness for Pharmaceuticals

The pharmaceutical industry operates both as an important business sector and a vital contributor to the delivery of health services worldwide. In 2012, the total world market for pharmaceutical products amounted to nearly US$1 trillion (see Table 1). Although global in scope, some 60 percent of sales were in North America and Europe, which comprise only 15 percent of the world’s population. The industry plays an important economic role in many countries by contributing to national income and employing hundreds of thousands of educated workers. Studies in the United States and Germany have found that for each direct employee, the pharmaceutical industry also generates between 1.6 and 3.5 jobs in supporting industries [7, 9]. While Germany long boasted of its role as the “world’s apothecary,” firms in Switzerland, France, the United Kingdom, and the United States also have underwritten decades of research into new medicines and brought several thousand new medicines to market since the late 19th century [1]. However, since the early 2000s, a steady decline in global prescription drug sales has accompanied an international deterioration in the underlying conditions critical to pharmaceutical in novation [6]. Troubles can be found also in a declining number of new chemical or biological medicines approved for markets despite a steady rise in research spending [8]. Policy discussions in some countries reveal a shift against industry arguments that high profit margins on current drug sales are necessary to finance research into future pharmaceuticals. Countries across the OECD instead are looking for ways to reduce health spending and national pharmaceutical budgets have been held constant or even reduced. Policies including reference pricing and demands that the industry demonstrate the cost effectiveness of its products are now widespread, especially in Europe [4]. Articles in this special issue of Pharmaceuticals Policy and Law analyse factors governing the legal and competitive environment for the pharmaceutical sector. Key issues are explored across the full pharmaceutical value chain, including drug discovery, development, authorization, and marketing. The articles demonstrate widespread, typically longstanding, tensions between policies that on the one hand

MTEFs and Fiscal Performance: Panel Data Evidence

In the last two decades more than 120 countries have adopted a multiyear budget process (Medium-Term Framework, or MTF) that enables the central government to set multiyear fiscal targets. This paper analyzes a newly-collected dataset of worldwide MTF adoptions during 1990-2008. It exploits within-country variation in adoption in a dynamic panel framework to estimate MTFs' impacts on aggregate as well as sectoral measures of fiscal performance. We find that on average multiyear budgeting improves budget balance by about 2 percentage points with more advanced MTF phases having a larger impact. Higher-phase MTFs also reduce health spending volatility, while only the top-phase MTF has a measurable impact on health sector technical efficiency.

Reforming the Tax Preference for Employer Health Insurance

Executive SummaryThe tax preference for employer-sponsored health insurance contributes to the very high level of health spending in the United States. In this paper, we consider the consequences for spending of one approach to reducing this preference: giving people with health insurance an additional deduction for their expected out-of-pocket spending, that is, an additional deduction that declines as the actuarial value of their insurance rises. We show that this approach would reduce health spending more and have a smaller budget cost than the deduction for actual out-of-pocket spending analyzed by Cogan, Hubbard, and Kessler by encouraging a shift to higher-copayment health insurance. We estimate that a deduction for expected out-of-pocket expenses would reduce private health spending by $86 billion in 2010 at a budget cost of approximately $5 billion. We conclude that, under reasonable assumptions about consumers’ valuation of this incremental spending and the cost of public funds, such a deduction ...

Promoting cancer screening within the patient centered medical home

While consensus has grown that primary care is the essential access point in a high-performing health care system, the current model of primary care underperforms in both chronic disease management and prevention. The Patient Centered Medical Home model (PCMH) is at the center of efforts to reinvent primary care practice, and is regarded as the most promising approach to addressing the burden of chronic disease, improving health outcomes, and reducing health spending. However, the potential for the medical home to improve the delivery of cancer screening (and preventive services in general) has received limited attention in both conceptualization and practice. Medical home demonstrations to date have included few evidence-based preventive services in their outcome measures, and few have evaluated the effect of different payment models. Decreasing use of hospitals and emergency rooms and an emphasis on improving chronic care represent improvements in effective delivery of healthcare, but leave opportunities for reducing the burden of cancer untouched. Data confirm that what does or does not happen in the primary care setting has a substantial impact on cancer outcomes. Insofar as cancer is the leading cause of death before age 80, the PCMH model must prioritize adherence to cancer screening according to recommended guidelines, and systems, financial incentives, and reimbursements must be aligned to achieve that goal. This article explores capacities that are needed in the medical home model to facilitate the integration of cancer screening and other preventive services. These capacities include improved patient access and communication, health risk assessments, periodic preventive health exams, use of registries that store cancer risk information and screening history, ability to track and follow up on tests and referrals, feedback on performance, and payment models that reward cancer screening.

Assessing The Evidence For Value-Based Insurance Design

High copayments for medical services can cause patients to underuse essential therapies. Value-based health insurance design attempts to address this problem by explicitly linking cost sharing and value. Copayments are set at low levels for high-value services. The Mercer National Survey of Employer-Sponsored Health Plans demonstrates that value-based insurance design use is increasing and that 81percent of large employers plan to offer it in the near future. Despite this increase, few studies have adequately evaluated its ability to improve quality and reduce health spending. Maximizing the benefits of value-based insurance design will require mechanisms to target appropriate copayment reductions, offset short-run cost outlays, and expand its use to other health services.

Rolling The Rock Up The Mountain

Rolling The Rock Up The Mountain

Agreement Could Shrink Part D 'Donut Hole'

Back to table of contents Previous article Next article Government NewsFull AccessAgreement Could Shrink Part D 'Donut Hole'Rich DalyRich DalySearch for more papers by this authorPublished Online:7 Aug 2009https://doi.org/10.1176/pn.44.15.0006APA has hailed an agreement by drug companies and the Obama administration to discount by 50 percent the cost of pharmaceuticals that fall within Medicare's drug coverage gap.The voluntary agreement by pharmaceutical companies, announced in June, will cut the cost of name-brand prescription medications by up to 50 percent when they fall into the so-called donut hole of Medicare's Part D prescription drug program that excludes coverage of drugs when their annual costs rise to between $2,700 and $6,154. Drug costs are reimbursed at 75 percent when they are less than $2,700 annually, and Medicare covers 100 percent of the cost of drugs once their accumulated cost rises above $6,154 annually.The agreement is predicted to provide up to $30 billion in discounts to seniors and save the federal government an additional $50 billion over 10 years in health care costs. Obama administration officials have not specified how these savings will occur.APA President Alan Schatzberg, M.D., hailed the development, calling the coverage gap “an excessive burden to those over 65 and those who are chronically disabled, including those suffering from mental illnesses.”“Although this is a first step, it is a step in the direction of providing high-quality, affordable health care to all Americans,” Schatzberg said. “APA recognizes that full prescription coverage is an integral part of any meaningful health care reform and applauds the effort to eliminate one of the most glaring deficiencies in Medicare.”The Obama administration described the agreement as part of the effort to enact major health care reform under consideration in Congress, because the details of the $50 billion projected savings in the agreement will be negotiated as part of final health care reform legislation. The deal is the latest high-profile voluntary agreement that the administration has announced with entities involved in the health care sector. The White House also has reached agreements for health care providers and hospitals to provide billions in savings to Medicare over the next 10 years, according to administration announcements. However, few details have been released on how those savings will be achieved, and some congressional leaders have said they will not honor the agreements in formulating health care reform measures.“The agreement by pharmaceutical companies to contribute to the health reform effort comes on the heels of the landmark pledge many health-industry leaders made to me last month, when they offered to do their part to reduce health spending $2 trillion over the next decade,” Obama said in a written statement issued in June.Those deals are important because the high cost of expanding insurance coverage to the nation's 47 million uninsured—estimated between $1 trillion and $2 trillion over 10 years—has slowed the pace of legislation in Congress to overhaul health care. Public-opinion polls also have consistently found that although most people support health reform, support is weak for any specific funding proposal.The impact of the latest agreement on people with serious mental illness could be significant.Roughly 3.5 million Medicare beneficiaries are projected to fall into the donut hole this year, according to congressional health reform advocates. According to a 2008 Kaiser Foundation study, about 500,000 Medicare beneficiaries—or 15 percent—stopped using their prescription drugs when they fell into the prescription costs range that comprises the donut hole. The study examined some beneficiaries with chronic illnesses, including people receiving treatment for depression, and found that 15 percent who were prescribed antidepressants stopped taking the medication when they reached the coverage gap in 2007. Another 8 percent stopped taking Alzheimer's medications when they reached the gap.Anita Everett, M.D., chair of APA's Council on Healthcare Systems and Financing, said the planned assistance would have a “tremendous impact” on fixed-income Medicare patients with mental illness.“Many individuals with mental illness depend on Medicare for access to psychiatric and other medications; the donut hole payment makes medications unaffordable to many who choose to go without rather than to pay hundreds of dollars each month for medications,” said Everett, in comments to Psychiatric News.Meanwhile, the pharmaceutical drug discount agreement drew some criticism from consumer advocates and liberal politicians, who said the total $80 billion in drug company price cuts are a tiny fraction of the $3.3 trillion in prescription drug spending that the Department of Health and Human Services estimates will occur over the next 10 years.The Kaiser Foundation report “The Medicare Part D Coverage Gap: Costs and Consequences in 2007” is posted at<http://www.kff.org/medicare/upload/7811.pdf>.▪ ISSUES NewArchived

Smoking: Bans, Bans, Good for the Heart!

Could moving to Pueblo, Colorado, be a new way to reduce the risk of suffering a heart attack? A study reported at the American Heart Association’s Scientific Sessions 2005 Conference in Dallas last November suggests that the city’s ban on smoking in all public buildings helped reduce the local heart attack rate by 27% over a year and a half. The finding appears to bolster recent decisions to ban smoking in workplaces and other public buildings across the United States, Spain, Ireland, and parts of the United Kingdom. Tobacco smoke—including secondhand smoke—activates blood coagulation pathways that could lead to coronary thrombosis, or heart attack. Smoke is particularly dangerous for people whose arteries are already hardened by age, cholesterol deposits, or smoking itself. Indeed, some 30% of heart attacks are thought directly related to smoke-induced thrombosis. In the United States, the annual direct medical cost of coronary heart disease caused by secondhand smoke alone is some $2.45 billion, according to the U.S. Society of Actuaries. In an attempt to reduce the incidence of heart attacks and other smoking-related illnesses, Pueblo introduced a ban 1 July 2003 on smoking in all indoor public areas within the city limits. Eighteen months later the Pueblo Public Health Department instigated an observational study to determine whether the ban had had any effect on the incidence of coronary events. “We recorded the number of heart attacks that occurred in the city for the eighteen months before and after the introduction of the ban,” explains Mori Krantz, director of the Prevention Department of the Colorado Prevention Center in Denver, “and found a post-introduction fall of around twenty-seven percent. This was significantly greater than the small reduction we saw among the population living outside the city limits, and much greater than the virtually unchanged rate among residents of [adjacent] El Paso County, which does not have such an ordinance.” Similar findings were reported in an earlier study published 24 April 2004 in BMJ after a smoking ban was imposed in Helena, Montana. “Our study builds on this work by involving a sample three times as large, and suggests that these ordinances may be having a positive effect on cardiac health,” says Krantz. “This observational study is limited in that it does not distinguish between smokers and nonsmokers, and did not check the medical records of those involved,” remarks Jose Ramon Banegas, a professor of preventive medicine and public health at the Universidad Autonoma in Madrid, Spain. He adds, however, that “even if the effect were half that reported, it would mean this type of ban could save many lives while reducing health spending.” Banegas points out that the results are also relevant given the new Spanish ban, enacted 1 January 2006, which still allows restaurateurs to declare their locales either smoking or nonsmoking. “Unfortunately,” he says, “ninety-eight percent are scared of losing income by going smoke-free.”

39107 Some recent developments in X-ray and neutron inspection methods : Proceedings of the 4th European Conference on Non-Destructive Testing, London (United Kingdom), 13–17 Sep. 1987. Vol. 1, pp. 155–162. Pergamon press, 3173 pp. (1988)

In the last two decades more than 120 countries have adopted a multiyear budget process (Medium-Term Framework, or MTF) that enables the central government to set multiyear fiscal targets. This paper analyzes a newly-collected dataset of worldwide MTF adoptions during 1990–2008. It exploits within-country variation in adoption in a dynamic panel framework to estimate MTFs' impacts on aggregate as well as sectoral measures of fiscal performance. We find that on average multiyear budgeting improves budget balance by about 2 percentage points with more advanced MTF phases having a larger impact. Higher-phase MTFs also reduce health spending volatility, while only the top-phase MTF has a measurable impact on health sector technical efficiency.

Reducing health spending: The role of financial incentives

Though the Treasury may use tax concessions for political ends, it has always been reluctant to regard taxes themselves as anything other than revenue‐raising devices. Also, British administrators, in implementing policy, have traditionally gone for regulatory measures rather than fiscal or pricing solutions. Taken together, this has meant there has been no effective lobby within the Civil Service for the policy‐oriented use of financial incentives. But what might happen if the Department of Health & Social Security was empowered to levy and receive the proceeds of its own taxes?