Managed care and inpatient mortality in adults: effect of primary payer.

BACKGROUND: Because managed care is increasingly prevalent in health care finance and delivery, it is important to ascertain its effects on health care quality relative to that of fee-for-service plans. Some stakeholders are concerned that basing gatekeeping, provider selection, and utilization management on cost may lower quality of care. To date, research on this topic has been inconclusive, largely because of variation in research methods and covariates. Patient age has been the only consistently evaluated outcome predictor. This study provides a comprehensive assessment of the association between managed care and inpatient mortality for Medicare and privately insured patients. METHODS: A cross-sectional design was used to examine the association between managed care and inpatient mortality for four common inpatient conditions. Data from the 2009 Healthcare Cost and Utilization Project State Inpatient Databases for 11 states were linked to data from the American Hospital Association Annual Survey Database. Hospital discharges were categorized as managed care or fee for service. A phased approach to multivariate logistic modeling examined the likelihood of inpatient mortality when adjusting for individual patient and hospital characteristics and for county fixed effects. RESULTS: Results showed different effects of managed care for Medicare and privately insured patients. Privately insured patients in managed care had an advantage over their fee-for-service counterparts in inpatient mortality for acute myocardial infarction, stroke, pneumonia, and congestive heart failure; no such advantage was found for the Medicare managed care population. To the extent that the study showed a protective effect of privately insured managed care, it was driven by individuals aged 65 years and older, who had consistently better outcomes than their non-managed care counterparts. CONCLUSIONS: Privately insured patients in managed care plans, especially older adults, had better outcomes than those in fee-for-service plans. Patients in Medicare managed care had outcomes similar to those in Medicare FFS. Additional research is needed to understand the role of patient selection, hospital quality, and differences among county populations in the decreased odds of inpatient mortality among patients in private managed care and to determine why this result does not hold for Medicare.

What hospital inpatient services contributed the most to the 2001-2006 growth in the cost per case?

OBJECTIVE: To demonstrate a refined cost-estimation method that converts detailed charges for inpatient stays into costs at the department level to enable analyses that can unravel the sources of rapid growth in inpatient costs. DATA SOURCES: Healthcare Cost and Utilization Project State Inpatient Databases and Medicare Cost Reports for all community, nonrehabilitation hospitals in nine states that reported detailed charges in 2001 and 2006 (n = 10,280,416 discharges). STUDY DESIGN: We examined the cost per discharge across all discharges and five subgroups (medical, surgical, congestive heart failure, septicemia, and osteoarthritis). DATA COLLECTION/EXTRACTION METHODS: We created cost-to-charge ratios (CCRs) for 13 cost-center or department-level buckets using the Medicare Cost Reports. We mapped service-code-level charges to a CCR with an internally developed crosswalk to estimate costs at the service-code level. PRINCIPAL FINDINGS: Supplies and devices were leading contributors (24.2 percent) to the increase in mean cost per discharge across all discharges. Intensive care unit and room and board (semiprivate) charges also substantially contributed (17.6 percent and 11.3 percent, respectively). Imaging and other advanced technological services were not major contributors (4.9 percent). CONCLUSIONS: Payers and policy makers may want to explore hospital stay costs that are rapidly rising to better understand their increases and effectiveness.

Trends in manufacturer prices of brand name prescription drugs used by older Americans--first quarter 2004 update.

This Issue Brief reports on changes in manufacturers' prescription drug prices during the first three months of 2004 (January through March) for the brand name prescription drugs most widely used by Americans age 50 and over. This report is the first quarterly update in an ongoing study of changes in drug manufacturer prices-that is, manufacturers' prices charged for drugs they sold to wholesalers. A baseline study published in May 2004 by the AARP Public Policy Institute identified steady increases in the average annual manufacturer price from calendar year 2000 through calendar year 2003. This report's focus is on changes in the prices that brand name drug manufacturers charge to wholesalers for sales to retail pharmacies. The manufacturer's charge to wholesalers is the most substantial component of a prescription drug's retail price. When there is an increase in the manufacturer price to wholesalers for a brand name drug, this added cost is generally passed on as a similar percent change in the retail price to most prescription purchasers. The report presents three measures of price change (see methodological appendix). The first set of findings are annual rates of change in manufacturers' prices for widely used brand name drugs, using both rolling average and point-to-point estimates; information is presented on percentage change in manufacturer price and on potential dollar changes in consumer spending. The second set of findings are three-month percentage changes in prices (i.e., changes from December 31, 2003 through March 31, 2004); the distribution of percentage price changes is shown, as well as differences in average percentage price changes by manufacturer and by therapeutic category.