For your health
Amanda Gengler
Journal of Health and Social Behavior, September 2014, Pages 342-359
Abstract:
Using data drawn from interviews and observations with 18 families whose children were diagnosed with life-threatening, often rare diseases, I examine how families accessed and negotiated medical care at a top 10–ranked university research hospital. Access to highly specialized and technologically advanced care was essential in these critical cases. Combining analysis of these high-stakes cases with recent work highlighting the interactional dynamics of care delivery, I show how families followed different paths to elite care and used different illness management strategies throughout the treatment process depending on their ability to mobilize what Janet Shim terms cultural health capital. These diverging illness management strategies reproduced inequality even at the top of the U.S. healthcare system by allowing some families to secure microadvantages throughout the illness experience. These findings suggest a complex interplay between structures of care delivery and families’ illness management strategies and point to the need for broader conceptualizations of healthcare advantages.
----------------------
A Comparison Of Hospital Administrative Costs In Eight Nations: US Costs Exceed All Others By Far
David Himmelstein et al.
Health Affairs, September 2014, Pages 1586-1594
Abstract:
A few studies have noted the outsize administrative costs of US hospitals, but no research has compared these costs across multiple nations with various types of health care systems. We assembled a team of international health policy experts to conduct just such a challenging analysis of hospital administrative costs across eight nations: Canada, England, Scotland, Wales, France, Germany, the Netherlands, and the United States. We found that administrative costs accounted for 25.3 percent of total US hospital expenditures — a percentage that is increasing. Next highest were the Netherlands (19.8 percent) and England (15.5 percent), both of which are transitioning to market-oriented payment systems. Scotland and Canada, whose single-payer systems pay hospitals global operating budgets, with separate grants for capital, had the lowest administrative costs. Costs were intermediate in France and Germany (which bill per patient but pay separately for capital projects) and in Wales. Reducing US per capita spending for hospital administration to Scottish or Canadian levels would have saved more than $150 billion in 2011. This study suggests that the reduction of US administrative costs would best be accomplished through the use of a simpler and less market-oriented payment scheme.
----------------------
Who pays the high health costs of older workers? Evidence from prostate cancer screening mandates
James Bailey
Applied Economics, Fall 2014, Pages 3931-3941
Abstract:
Between 1992 and 2009, 30 US states adopted laws mandating that health insurance plans cover screenings for prostate cancer. Because prostate cancer screenings are used almost exclusively by men over age 50, these mandates raise the cost of insuring older men relative to other groups. This article uses a triple-difference empirical strategy to take advantage of this quasi-random natural experiment in raising the cost of employing older workers. Using Integrated Public Use Microdata Series data from the March Supplement of the Current Population Survey, I find that the increased cost of insuring older workers results in their receiving 2.8% lower hourly wages, being 2% less likely to be employed and being 0.7% less likely to have employer-sponsored health insurance.
----------------------
Does Privatized Health Insurance Benefit Patients or Producers? Evidence from Medicare Advantage
Marika Cabral, Michael Geruso & Neale Mahoney
NBER Working Paper, September 2014
Abstract:
The debate over privatizing Medicare stems from a fundamental disagreement about whether privatization would primarily generate consumer surplus for individuals or producer surplus for insurance companies and health care providers. This paper investigates this question by studying an existing form of privatized Medicare called Medicare Advantage (MA). Using difference-in-differences variation brought about by payment floors established by the 2000 Benefits Improvement and Protection Act, we find that for each dollar in increased capitation payments, MA insurers reduced premiums to individuals by 45 cents and increased the actuarial value of benefits by 8 cents. Using administrative data on the near-universe of Medicare beneficiaries, we show that advantageous selection into MA cannot explain this incomplete pass-through. Instead, our evidence suggests that insurer market power is an important determinant of the division of surplus, with premium pass-through rates of 13% in the least competitive markets and 74% in the markets with the most competition.
----------------------
Jonathan Gruber & Robin McKnight
NBER Working Paper, September 2014
Abstract:
Recent years have seen enormous growth in limited network plans that restrict patient choice of provider, particularly through state exchanges under the ACA. Opposition to such plans is based on concerns that restrictions on provider choice will harm patient care. We explore this issue in the context of the Massachusetts GIC, the insurance plan for state employees, which recently introduced a major financial incentive to choose limited network plans for one group of enrollees and not another. We use a quasi-experimental analysis based on the universe of claims data over a three-year period for GIC enrollees. We find that enrollees are very price sensitive in their decision to enroll in limited network plans, with the state’s three month “premium holiday” for limited network plans leading 10% of eligible employees to switch to such plans. We find that those who switched spent considerably less on medical care; spending fell by almost 40% for the marginal complier. This reflects both reductions in quantity of services used and prices paid per service. But spending on primary care actually rose for switchers; the reduction in spending came entirely from spending on specialists and on hospital care, including emergency rooms. We find that distance traveled falls for primary care and rises for tertiary care, although there is no evidence of a decrease in the quality of hospitals used by patients. The basic results hold even for the sickest patients, suggesting that limited network plans are saving money by directing care towards primary care and away from downstream spending. We find such savings only for those whose primary care physicians are included in limited network plans, however, suggesting that networks that are particularly restrictive on primary care access may fare less well than those that impose only stronger downstream restrictions.
----------------------
Karen Joynt et al.
Health Services Research, forthcoming
Objective: To assess the impact of Massachusetts Health Reform (MHR) on access, quality, and costs of outpatient care for the already-insured.
Study Design: We performed a retrospective difference-in-differences analysis of quantity of outpatient visits, proportion of outpatient quality metrics met, and costs of care for Medicare patients with ≥1 chronic disease in 2006 versus 2009. We used the remaining states in New England as controls.
Principal Findings: MHR was not associated with a decrease in outpatient visits per year compared to controls (9.4 prereform to 9.6 postreform in MA vs. 9.4–9.5 in controls, p = .32). Quality of care in MA improved more than controls for hemoglobin A1c monitoring, mammography, and influenza vaccination, and similarly to controls for diabetic eye examination, colon cancer screening, and pneumococcal vaccination. Average costs for patients in Massachusetts increased from $9,389 to $10,668, versus $8,375 to $9,114 in control states (p < .001).
Conclusions: MHR was not associated with worsening in access or quality of outpatient care for the already-insured, and it had modest effects on costs. This has implications for other states expanding insurance coverage under the Affordable Care Act.
----------------------
Process Learning and the Implementation of Medicaid Reform
Timothy Callaghan & Lawrence Jacobs
Publius, Fall 2014, Pages 541-563
Abstract:
As the implementation of health care reform proceeds in the face of ongoing political conflict, variations in state decisions are shaping important aspects of its pace and scope. This article investigates five potential explanations for state implementation of the Medicaid expansion — state party control, economic affluence, the trajectory of established policy, state administrative capacity, and the process of learning from intergovernmental bargaining. Our analysis of fifty states finds, not surprisingly, that party control of government influences state decisions. We also find, however, several additional and striking influences on states — namely, the trajectory of established policy for vulnerable populations and, of particular importance, state learning about the process of intergovernmental bargaining.
----------------------
Small Primary Care Physician Practices Have Low Rates Of Preventable Hospital Admissions
Lawrence Casalino et al.
Health Affairs, September 2014, Pages 1680-1688
Abstract:
Nearly two-thirds of US office-based physicians work in practices of fewer than seven physicians. It is often assumed that larger practices provide better care, although there is little evidence for or against this assumption. What is the relationship between practice size — and other practice characteristics, such as ownership or use of medical home processes — and the quality of care? We conducted a national survey of 1,045 primary care–based practices with nineteen or fewer physicians to determine practice characteristics. We used Medicare data to calculate practices’ rate of potentially preventable hospital admissions (ambulatory care–sensitive admissions). Compared to practices with 10–19 physicians, practices with 1–2 physicians had 33 percent fewer preventable admissions, and practices with 3–9 physicians had 27 percent fewer. Physician-owned practices had fewer preventable admissions than hospital-owned practices. In an era when health care reform appears to be driving physicians into larger organizations, it is important to measure the comparative performance of practices of all sizes, to learn more about how small practices provide patient care, and to learn more about the types of organizational structures — such as independent practice associations — that may make it possible for small practices to share resources that are useful for improving the quality of care.
----------------------
Trends in Hospitalizations and Outcomes for Acute Cardiovascular Disease and Stroke: 1999-2011
Harlan Krumholz, Sharon-Lise Normand & Yun Wang
Circulation, 16 September 2014, Pages 966-975
Background: The past decade focused intensely on improving the quality of care for people with, or at risk for, cardiovascular disease and stroke. We sought to quantify the changes in hospitalization rates and outcomes during this period.
Methods and Results: We used national Medicare data to identify all Fee-For-Service patients aged ≥65 years hospitalized with unstable angina, myocardial infarction, heart failure, ischemic stroke, and all other conditions from 1999 through 2011 (2010 for 1-year mortality). For each condition, we examined trends in adjusted rates of hospitalization per patient-year and, for each hospitalization, rates of 30-day mortality, 30-day readmission, and 1-year mortality overall and by demographic subgroups and regions. Rates of adjusted hospitalization declined for cardiovascular conditions (38.0% for 2011 compared with 1999 [95% CI] [37.2% to 38.8%] for myocardial infarction; 83.8% [83.3% to 84.4%] for unstable angina; 30.5% [29.3% to 31.6% ] for heart failure; and 33.6% [32.9% to 34.4%] for ischemic stroke compared with 10.2% [10.1% to 10.2%] for all other conditions). Adjusted 30-day mortality rates declined 29.4% [28.1% to 30.6%] for myocardial infarction; 13.1% [1.1% to 23.7%] for unstable angina; 16.4% [15.1% to 17.7%] for heart failure; and 4.7% for ischemic stroke [3.0% to 6.4%]. There were also reductions in rates of 1-year mortality and 30-day readmission and consistency in declines among the demographic subgroups.
Conclusions: Hospitalizations for acute cardiovascular disease and stroke from 1999 through 2011 declined more rapidly than for other conditions. For these conditions, mortality and readmission outcomes improved.
----------------------
Is Health Care an Individual Necessity? Evidence from Social Security Notch
Yuping Tsai
Centers for Disease Control and Prevention Working Paper, August 2014
Abstract:
This paper exploits Social Security legislation changes to identify the causal effect of Social Security income on out-of-pocket medical expenditures of the elderly. Using the household level consumption data from the 1986-1994 Consumer Expenditure Survey and an instrumental variables strategy, the empirical results show that the estimated income elasticities of out-of-pocket total medical costs, medical service expenses, and prescription drug expenses are about 0.89, 1.05, and 0.86, respectively. The estimated elasticities increase substantially and are statistically significant for elderly individuals with less than a high school education. The corresponding income elasticities are 2.49, 3.66, and 1.38, respectively. The findings are in sharp contrast to existing studies that use micro-level data and provide evidence that health care is a luxury good among the low education elderly.
----------------------
Risk Corridors and Reinsurance in Health Insurance Marketplaces: Insurance for Insurers
Timothy Layton, Thomas McGuire & Anna Sinaiko
NBER Working Paper, September 2014
Abstract:
In order to encourage entry and lower prices, most regulated markets for health insurance include policies that seek to reduce the uncertainty faced by insurers. In addition to risk adjustment of premiums paid to plans, the Health Insurance Marketplaces established by the Affordable Care Act implement reinsurance and risk corridors. Reinsurance limits insurer costs associated with specific individuals, while risk corridors protect against aggregate losses. Both tighten the insurer’s distribution of expected costs. This paper considers the economic costs and consequences of reinsurance and risk corridors. Drawing a parallel to individual insurance principles first described by Arrow (1963) and Zeckhauser (1970), we first discuss the optimal insurance policy for insurers. Then, we simulate the insurer’s cost distribution under reinsurance and risk corridors using health care utilization data for a group of individuals likely to enroll in Marketplace plans from the Medical Expenditure Panel Survey. We compare reinsurance and risk corridors in terms of insurer risk reduction and incentives for cost containment, finding that one-sided risk corridors achieve more risk reduction for a given level of cost containment incentives than both reinsurance and two-sided risk corridors. We also find that the ACA policies being implemented in the Marketplaces (a mix of reinsurance and two-sided risk corridor policies) substantially limit insurer risk but that they are outperformed by a simpler one-sided risk corridor policy according to our measures of insurer risk and incentives.
----------------------
Ann Bartel, Carri Chan & Song-Hee (Hailey) Kim
NBER Working Paper, September 2014
Abstract:
Twenty percent of Medicare patients are readmitted to the hospital within 30 days of discharge, resulting in substantial costs to the U.S. government. As part of the 2010 Affordable Care Act, the Hospital Readmissions Reduction Program financially penalizes hospitals with higher than expected readmissions. Utilizing data on the over 6.6 million Medicare patients treated between 2008 and 2011, we estimate the reductions in readmission and mortality rates of an inpatient intervention (keeping patients in the hospital for an extra day) versus providing outpatient interventions. We find that for heart failure patients, the inpatient and outpatient interventions have practically identical impact on reducing readmissions. For heart attack and pneumonia patients, keeping patients for one more day can potentially save 5 to 6 times as many lives over outpatient programs. Moreover, we find that even if the outpatient programs were cost-free, incurring the additional costs of an extra day may be a more cost-effective option to save lives. While some outpatient programs can be very effective at reducing hospital readmissions, we find that inpatient interventions can be just as, if not more, effective.
----------------------
Health Care Use, Out-of-Pocket Expenditure, and Macroeconomic Conditions during the Great Recession
Juan Du & Takeshi Yagihashi
B.E. Journal of Economic Analysis & Policy, forthcoming
Abstract:
We study how macroeconomic conditions during the Great Recession affected health care utilization and out-of-pocket expenditures of American households. We use two data sources: the Consumer Expenditure (CE) Survey and the Survey of Income and Program Participation (SIPP); each has its own advantages. The CE contains quarterly frequency variables, and the SIPP provides panel data at the individual level. Consistent evidence across the two datasets shows that utilization of routine medical care was counter-cyclical, whereas hospital care was pro-cyclical during the Great Recession. When we examine the pre-recession period, the relationship between macroeconomic conditions and health care use was either non-existent or in opposite directions, suggesting that this relationship may have been unique to the Great Recession.
----------------------
Dina Maskileyson
Social Science & Medicine, October 2014, Pages 18–26
Abstract:
The present study provides a comparative analysis of the association between wealth and health in six healthcare systems (Sweden, the United Kingdom, Germany, the Czech Republic, Israel, the United States). National samples of individuals fifty years and over reveal considerable cross-country variations in health outcomes. In all six countries wealth and health are positively associated. The findings also show that state-based healthcare systems produce better population health outcomes than private-based healthcare systems. The results indicate that in five out of the six countries studied, the wealth–health gradients were remarkably similar, despite significant variations in healthcare system type. Only in the United States was the association between wealth and health substantially different from, and much greater than that in the other five countries. The findings suggest that private-based healthcare system in the U.S. is likely to promote stronger positive associations between wealth and health.
----------------------
Naoki Kondo, Mikael Rostila & Monica Åberg Yngwe
Journal of Epidemiology & Community Health, forthcoming
Background: In the past two decades, health inequality has persisted or increased in states with comprehensive welfare.
Methods: We conducted a national registry-based repeated cohort study with a 3-year follow-up between 1990 and 2007 in Sweden. Information on all-cause mortality in all working-age Swedish men and women aged between 30 and 64 years was collected. Data were subjected to temporal trend analysis using joinpoint regression to statistically confirm the trajectories observed.
Results: Among men, age-standardised mortality rate decreased by 38.3% from 234.9 to 145 (per 100 000 population) over the whole period in the highest income quintile, whereas the reduction was only 18.3% (from 774.5 to 632.5) in the lowest quintile. Among women, mortality decreased by 40% (from 187.4 to 112.5) in the highest income group, but increased by 12.1% (from 280.2 to 314.2) in the poorest income group. Joinpoint regression identified that the differences in age-standardised mortality between the highest and the lowest income quintiles decreased among men by 18.85 annually between 1990 and 1994 (p trend=0.02), whereas it increased later, with a 2.88 point increase per year (p trend <0.0001). Among women, it continuously increased by 9.26/year (p trend <0.0001). In relative terms, age-adjusted mortality rate ratios showed a continuous increase in both genders.
Conclusions: Income-based inequalities among working-age male and female Swedes have increased since the late 1990s, whereas in absolute terms the increase was less remarkable among men. Structural and behavioural factors explaining this trend, such as the economic recession in the early 1990s, should be studied further.
----------------------
Economies of Dying: The Moralization of Economic Scarcity in U.S. Hospice Care
Roi Livne
American Sociological Review, forthcoming
Abstract:
As efforts are made to contain health care spending, the decision to stop trying to cure severely ill patients and focus on comfort care has become an economic as well as a moral issue. This article examines the intricate intersection of economics and morality in U.S. hospice care. Using historical, interview, and ethnographic methods, I explain the resonance between hospice practitioners’ moral motivations and policymakers’, insurers’, and providers’ efforts to economize near the end of life. Drawing on theoretical literature on morality in markets, I analyze the moralization of economic scarcity. I argue that rather than posing an external financial constraint on the achievement of moral goals, scarcity itself can bear moral meanings. In the case of hospice care, the view that “less is better” and the wish to save patients from over-treatment converge with financial interests to limit spending on end-of-life care and imbue financial constraints with positive moral meanings.
----------------------
The Association Between Residency Training and Internists’ Ability to Practice Conservatively
Brenda Sirovich et al.
JAMA Internal Medicine, forthcoming
Objective: To assess whether graduates of residency programs characterized by low-intensity practice patterns are more capable of managing patients’ care conservatively, when appropriate, and whether graduates of these programs are less capable of providing appropriately aggressive care.
Design, Setting, and Participants: Cross-sectional comparison of 6639 first-time takers of the 2007 American Board of Internal Medicine certifying examination, aggregated by residency program (n = 357).
Exposures: Intensity of practice, measured using the End-of-Life Visit Index, which is the mean number of physician visits within the last 6 months of life among Medicare beneficiaries 65 years and older in the residency program’s hospital referral region.
Main Outcomes and Measures: The mean score by program on the Appropriately Conservative Management (ACM) (and Appropriately Aggressive Management [AAM]) subscales, comprising all American Board of Internal Medicine certifying examination questions for which the correct response represented the least (or most, respectively) aggressive management strategy. Mean scores on the remainder of the examination were used to stratify programs into 4 knowledge tiers. Data were analyzed by linear regression of ACM (or AAM) scores on the End-of-Life Visit Index, stratified by knowledge tier.
Results: Within each knowledge tier, the lower the intensity of health care practice in the hospital referral region, the better residency program graduates scored on the ACM subscale (P < .001 for the linear trend in each tier). In knowledge tier 4 (poorest), for example, graduates of programs in the lowest-intensity regions had a mean ACM score in the 38th percentile compared with the 22nd percentile for programs in the highest-intensity regions; in tier 2, ACM scores ranged from the 75th to the 48th percentile in regions from lowest to highest intensity. Graduates of programs in low-intensity regions tended, more weakly, to score better on the AAM subscale (in 3 of 4 knowledge tiers).
Conclusions and Relevance: Regardless of overall medical knowledge, internists trained at programs in hospital referral regions with lower-intensity medical practice are more likely to recognize when conservative management is appropriate. These internists remain capable of choosing an aggressive approach when indicated.
----------------------
The Effect of Any Willing Provider and Freedom of Choice Laws on Prescription Drug Expenditures
Jonathan Klick & Joshua Wright
American Law and Economics Review, forthcoming
Abstract:
Pharmacy benefit managers (PBMs) potentially lower costs associated with prescription drugs through increased bargaining power with manufacturers. PBMs engage in selective contracting with pharmacies which has the potential to reduce retail competition, leading to increased prices. Proponents of “Any Willing Provider (AWP)” and “Freedom of Choice (FOC)” laws limiting this selective contracting claim increased retail competition will lower prescription drug spending. Examining the passage of such laws over the period 1991–2009, we find that AWP laws increase spending on prescription drugs by ∼5% beyond any pre-existing trends in spending while FOC laws have no significant effect.
----------------------
Health Insurance and Chronic Conditions in Low-Income Urban Whites
J.R. Smolen et al.
Journal of Urban Health, August 2014, Pages 637-647
Abstract:
Little is known about how health insurance contributes to the prevalence of chronic disease in the overlooked population of low-income urban whites. This study uses cross-sectional data on 491 low-income urban non-elderly non-Hispanic whites from the Exploring Health Disparities in Integrated Communities—Southwest Baltimore (EHDIC-SWB) study to examine the relationship between insurance status and chronic conditions (defined as participant report of ever being told by a doctor they had hypertension, diabetes, stroke, heart attack, anxiety or depression, asthma or emphysema, or cancer). In this sample, 45.8 % were uninsured, 28.3 % were publicly insured, and 25.9 % had private insurance. Insured participants had similar odds of having any chronic condition (odds ratios (OR) 1.06; 95 % confidence intervals (CI) 0.70–1.62) compared to uninsured participants. However, those who had public insurance had a higher odds of reporting any chronic condition compared to the privately insured (OR 2.29; 95 % CI 1.21–4.35). In low-income urban areas, the health of whites is not often considered. However, this is a significant population whose reported prevalence of chronic conditions has implications for the Medicaid expansion and the implementation of health insurance exchanges.
----------------------
Do Patient-Centered Medical Homes Reduce Emergency Department Visits?
Guy David et al.
Health Services Research, forthcoming
Objective: To assess whether adoption of the patient-centered medical home (PCMH) reduces emergency department (ED) utilization among patients with and without chronic illness.
Data Sources: Data from approximately 460,000 Independence Blue Cross patients enrolled in 280 primary care practices, all converting to PCMH status between 2008 and 2012.
Research Design: We estimate the effect of a practice becoming PCMH-certified on ED visits and costs using a difference-in-differences approach which exploits variation in the timing of PCMH certification, employing either practice or patient fixed effects. We analyzed patients with and without chronic illness across six chronic illness categories.
Principal Findings: Among chronically ill patients, transition to PCMH status was associated with 5–8 percent reductions in ED utilization. This finding was robust to a number of specifications, including analyzing avoidable and weekend ED visits alone. The largest reductions in ED visits are concentrated among chronic patients with diabetes and hypertension.
Conclusions: Adoption of the PCMH model was associated with lower ED utilization for chronically ill patients, but not for those without chronic illness. The effectiveness of the PCMH model varies by chronic condition. Analysis of weekend and avoidable ED visits suggests that reductions in ED utilization stem from better management of chronic illness rather than expanding access to primary care clinics.