Performance of private sector health care: implications for universal health coverage.

Although the private sector is an important health-care provider in many low-income and middle-income countries, its role in progress towards universal health coverage varies. Studies of the performance of the private sector have focused on three main dimensions: quality, equity of access, and efficiency. The characteristics of patients, the structures of both the public and private sectors, and the regulation of the sector influence the types of health services delivered, and outcomes. Combined with characteristics of private providers-including their size, objectives, and technical competence-the interaction of these factors affects how the sector performs in different contexts. Changing the performance of the private sector will require interventions that target the sector as a whole, rather than individual providers alone. In particular, the performance of the private sector seems to be intrinsically linked to the structure and performance of the public sector, which suggests that deriving population benefit from the private health-care sector requires a regulatory response focused on the health-care sector as a whole.

Impact of Maryland's 2011 alcohol sales tax increase on alcoholic beverage sales.

BACKGROUND: Increasing alcohol taxes has proven effective in reducing alcohol consumption, but the effects of alcohol sales taxes on sales of specific alcoholic beverages have received little research attention. Data on sales are generally less subject to reporting biases than self-reported patterns of alcohol consumption. OBJECTIVES: We aimed to assess the effects of Maryland's July 1, 2011 three percentage point increase in the alcohol sales tax (6-9%) on beverage-specific and total alcohol sales. METHODS: Using county-level data on Maryland's monthly alcohol sales in gallons for 2010-2012, by beverage type, multilevel mixed effects multiple linear regression models estimated the effects of the tax increase on alcohol sales. We controlled for seasonality, county characteristics, and national unemployment rates in the main analyses. RESULTS: In the 18 months after the tax increase, average per capita sales of spirits were 5.1% lower (p < 0.001), beer sales were 3.2% lower (p < 0.001), and wine sales were 2.5% lower (p < 0.01) relative to what would have been expected from sales trends in the 18 months prior to the tax increase. Overall, the alcohol sales tax increase was associated with a 3.8% decline in total alcohol sold relative to what would have been expected based on sales in the prior 18 months (p < 0.001). CONCLUSION: The findings suggest that increased alcohol sales taxes may be as effective as excise taxes in reducing alcohol consumption and related problems. Sales taxes also have the added advantages of rising with inflation and taxing the highest priced beverages most heavily.

Economic evaluation of neonatal care packages in a cluster-randomized controlled trial in Sylhet, Bangladesh.

OBJECTIVE: To evaluate and compare the cost-effectiveness of two strategies for neonatal care in Sylhet division, Bangladesh. METHODS: In a cluster-randomized controlled trial, two strategies for neonatal care--known as home care and community care--were compared with existing services. For each study arm, economic costs were estimated from a societal perspective, inclusive of programme costs, provider costs and household out-of-pocket payments on care-seeking. Neonatal mortality in each study arm was determined through household surveys. The incremental cost-effectiveness of each strategy--compared with that of the pre-existing levels of maternal and neonatal care--was then estimated. The levels of uncertainty in our estimates were quantified through probabilistic sensitivity analysis. FINDINGS: The incremental programme costs of implementing the home-care package were 2939 (95% confidence interval, CI: 1833-7616) United States dollars (US$) per neonatal death averted and US$ 103.49 (95% CI: 64.72-265.93) per disability-adjusted life year (DALY) averted. The corresponding total societal costs were US$ 2971 (95% CI: 1844-7628) and US$ 104.62 (95% CI: 65.15-266.60), respectively. The home-care package was cost-effective--with 95% certainty--if healthy life years were valued above US$ 214 per DALY averted. In contrast, implementation of the community-care strategy led to no reduction in neonatal mortality and did not appear to be cost-effective. CONCLUSION: The home-care package represents a highly cost-effective intervention strategy that should be considered for replication and scale-up in Bangladesh and similar settings elsewhere.

The global burden of unsafe medical care: analytic modelling of observational studies.

OBJECTIVE: To contextualise the degree of harm that comes from unsafe medical care compared with individual health conditions using the global burden of disease (GBD), a metric to determine how much suffering is caused by individual diseases. DESIGN: Analytic modelling of observational studies investigating unsafe medical care in countries' inpatient care settings, stratified by national income, to identify incidence of seven adverse events for GBD modelling. Observational studies were generated through a comprehensive search of over 16 000 articles written in English after 1976, of which over 4000 were appropriate for full text review. RESULTS: The incidence, clinical outcomes, demographics and costs for each of the seven adverse events were collected from each publication when available. We used disability-adjusted life years (DALYs) lost as a standardised metric to measure morbidity and mortality due to specific adverse events. We estimate that there are 421 million hospitalisations in the world annually, and approximately 42.7 million adverse events. These adverse events result in 23 million DALYs lost per year. Approximately two-thirds of all adverse events, and the DALYs lost from them, occurred in low-income and middle-income countries. CONCLUSIONS: This study provides early evidence that adverse events due to medical care represent a major source of morbidity and mortality globally. Though suffering related to the lack of access to care in many countries remains, these findings suggest the importance of critically evaluating the quality and safety of the care provided once a person accesses health services. While further refinements of the estimates are needed, these data should be a call to global health policymakers to make patient safety an international priority.

The business case for quality: economic analysis of the Michigan Keystone Patient Safety Program in ICUs.

Health care-associated infections affect an estimated 5% of hospitalized patients and represent one of the leading causes of illness and death in the United States. This study calculates the costs and benefits of a patient safety program in intensive care units in 6 hospitals that were part of the Michigan Keystone ICU Patient Safety Program. On average, 29.9 catheter-related bloodstream infections and 18.0 cases of ventilator-associated pneumonia were averted per hospital on an annual basis. The average cost of the intervention is $3375 per infection averted, measured in 2007 dollars. The cost of the intervention is substantially less than estimates of the additional health care costs associated with these infections, which range from $12 208 to $56 167 per infection episode. These results do not take into account the additional effect of the Michigan Keystone program in terms of reducing cases of sepsis or its effects in terms of preventing mortality, improving teamwork, and reducing nurse turnover.

A cost-effectiveness analysis of India's 2008 prohibition of smoking in public places in Gujarat.

Tobacco smoking and exposure to secondhand tobacco smoke are associated with disability and premature mortality in low and middle-income countries. The aim of this study was to assess the cost-effectiveness of implementing India's Prohibition of Smoking in Public Places Rules in the state of Gujarat, compared to implementation of a complete smoking ban. Using standard cost-effectiveness analysis methods, the cost of implementing the alternatives was evaluated against the years of life saved and cases of acute myocardial infarction averted by reductions in smoking prevalence and secondhand smoke exposure. After one year, it is estimated that a complete smoking ban in Gujarat would avert 17,000 additional heart attacks and gain 438,000 life years (LY). A complete ban is highly cost-effective when key variables including legislation effectiveness were varied in the sensitivity analyses. Without including medical treatment costs averted, the cost-effectiveness ratio ranges from $2 to $112 per LY gained and $37 to $386 per acute myocardial infarction averted. Implementing a complete smoking ban would be a cost saving alternative to the current partial legislation in terms of reducing tobacco-attributable disease in Gujarat.

Medical costs of secondhand-smoke exposure in North Carolina.

BACKGROUND: The health hazards of exposure to secondhand smoke (SHS) are well-defined. Less is known about the economic costs. We performed an analysis of the medical costs of SHS in North Carolina that was based on a similar study conducted in Minnesota. METHODS: We used 2006 Blue Cross and Blue Shield of North Carolina claims data and national and state surveillance data to calculate the treated prevalence of medical conditions that have been found to be related to exposure to SHS, as established by a 2006 report from the US surgeon general. We used the population attributable risk for these conditions to calculate the number of individuals whose episodes of illness could be attributed to exposure to SHS. We adjusted these treatment costs for other types of insurance provided in the state, using Medical Expenditure Panel Survey data. RESULTS: The total annual cost of treatment for conditions related to SHS exposure in North Carolina was estimated to be $293,304,430, in 2009 inflation-adjusted dollars. Sensitivity analysis showed a range of $208.2 million to $386.3 million. The majority of individuals affected were children, but the greatest costs were for cardiovascular conditions. CONCLUSION: These cost data provide additional rationale for regulating smoking in all work sites and public places.

The economic impact of Mexico City's smoke-free law.

OBJECTIVE: To evaluate the economic impact of Mexico City's 2008 smoke-free law--The Non-Smokers' Health Protection Law on restaurants, bars and nightclubs. MATERIAL AND METHODS: We used the Monthly Services Survey of businesses from January 2005 to April 2009--with revenues, employment and payments to employees as the principal outcomes. The results are estimated using a differences-in-differences regression model with fixed effects. The states of Jalisco, Nuevo León and México, where the law was not in effect, serve as a counterfactual comparison group. RESULTS: In restaurants, after accounting for observable factors and the fixed effects, there was a 24.8% increase in restaurants' revenue associated with the smoke-free law. This difference is not statistically significant but shows that, on average, restaurants did not suffer economically as a result of the law. Total wages increased by 28.2% and employment increased by 16.2%. In nightclubs, bars and taverns there was a decrease of 1.5% in revenues and an increase of 0.1% and 3.0%, respectively, in wages and employment. None of these effects are statistically significant in multivariate analysis. CONCLUSIONS: There is no statistically significant evidence that the Mexico City smoke-free law had a negative impact on restaurants' income, employees' wages and levels of employment. On the contrary, the results show a positive, though statistically non-significant, impact of the law on most of these outcomes. Mexico City's experience suggests that smoke-free laws in Mexico and elsewhere will not hurt economic productivity in the restaurant and bar industries.

Cost-effectiveness analysis of a low-fat diet in the prevention of breast and ovarian cancer.

BACKGROUND: Results of the Women's Health Initiative Randomized Controlled Dietary Modification Trial (WHI-DM) suggest that a low-fat diet may be associated with beneficial health outcomes for specific groups of women. OBJECTIVE: The objective is to assess how cost-effective the WHI-DM would be if implemented as a public health intervention and under the sponsorship of private health insurers and Medicare. Breast and ovarian cancers are the health outcomes of interest. PARTICIPANTS: Two groups of WHI-DM participants form the target population for this analysis: participants consuming >36.8% of energy from fat at baseline, and participants at high risk for breast cancer with 32% or more of energy from fat at baseline. METHODS: This study uses Markov cohort modeling, following societal and health care payer perspectives, with Monte Carlo simulations and one-way sensitivity analyses. WHI-DM records, nationally representative prices, and published estimates of medical care costs were the sources of cost information. Simulations were performed for hypothetical cohorts of women aged 50, 55, 60, 65, or 70 years at the beginning of the intervention. Effectiveness was estimated by quality-adjusted life years (QALYs) and the main outcome measure was the incremental cost-effectiveness ratio (ICER). RESULTS: Following the societal perspective, the ICERs for the 50-year old cohort are $13,773/QALY (95% confidence interval $7,482 to $20,916) for women consuming >36.8% of energy from fat at baseline and $10,544/QALY ($2,096 to $23,673) for women at high risk for breast cancer. The comparable ICER from a private health care payer perspective is $66,059/QALY ($30,155 to $121,087) and from a Medicare perspective, it is $15,051/QALY ($6,565 to $25,105). CONCLUSIONS: The WHI-DM is a cost-effective strategy for the prevention of breast and ovarian cancers in the target population, from both societal and Medicare perspectives. Private health care payers have a relative short timeframe to realize a return on investment, since after age 65 years the financial benefits associated with the prevention program would accrue to Medicare. For this reason, the intervention is not cost-effective from a private health care payer perspective.

Self-reported price of cigarettes, consumption and compensatory behaviours in a cohort of Mexican smokers before and after a cigarette tax increase.

OBJECTIVE: To assess the impact of a 2007 cigarette tax increase from 110% to 140% of the price to the retailer on cigarette price and consumption among Mexican smokers, including efforts to offset price increases. METHODS: Data were analysed from the 2006 and 2007 administrations of the International Tobacco Control (ITC) Policy Evaluation Survey in Mexico, which is a population-based cohort of adult smokers. Self-reported price of last cigarette purchase, place of last purchase, preferred brand, daily consumption and quit behaviour were assessed at baseline and follow-up. RESULTS: Self-reported cigarette prices increased by 12.7% after the tax increase, with prices for international brands increasing more than for national brands (13.5% vs 8.7%, respectively). Although the tax increases were not fully passed onto consumers particularly on national brands, no evidence was found for smokers changing behaviour to offset price increases. Consistent declines in consumption across groups defined by sociodemographic and smoking-related psychosocial variables suggest a relatively uniform impact of the tax increase across subpopulations. However, decreased consumption appeared limited to people who smoked relatively more cigarettes a day (>5 cigarettes/day). Average daily consumption among lighter smokers did not significantly decline. A total of 13% (n=98) of the sample reported being quit for a month or more at follow-up. In multivariate models, lighter smokers were more likely than heavier smokers to be quit. CONCLUSIONS: Results suggest that the 2007 tax increase was passed on to consumers, whose consumption generally declined. Since no other tobacco control policies or programmes were implemented during the period analysed, the tax increase appears likely to have decreased consumption.

Expensive cancer drugs: a comparison between the United States and the United Kingdom.

CONTEXT: This article compares the United Kingdom's and the United States' experiences with expensive cancer drugs to illustrate the challenges posed by new, extremely costly, medical technologies. METHODS: This article describes British and American coverage, access, and cost-sharing policies with regard to expensive cancer drugs and then compares the costs of eleven such drugs to British patients, American Medicare beneficiaries, and American patients purchasing the drugs in the retail market. Three questions posed by these comparisons are then examined: First, which system is fairer? In which system are cancer patients better off? Assuming that no system can sustainably provide to everyone at least some expensive cancer drugs for some clinical indications, what challenges does each system face in making these difficult determinations? FINDINGS: In both the British and American health care systems, not all patients who might benefit from or desire access to expensive cancer drugs have access to them. The popular characterization of the United States, where all cancer drugs are available for all to access as and when needed, and that of the British NHS, where top-down population rationing poses insurmountable obstacles to British patients' access, are far from the reality in both countries. CONCLUSIONS: Key elements of the British system are fairer than the American system, and the British system is better structured to deal with difficult decisions about expensive end-of-life cancer drugs. Both systems face common ethical, financial, organizational, and priority-setting challenges in making these decisions.

An experiment with community health funds in Afghanistan.

As Afghanistan rebuilds its health system, it faces key challenges in financing health services. To reduce dependence on donor funds, it is important to develop sustainable local financing mechanisms. A second challenge is to reduce high levels of out-of-pocket payments. Community-based health insurance (CBHI) schemes offer the possibility of raising revenues from communities and at the same time providing financial protection. This paper describes the performance of one type of CBHI scheme, the Community Health Fund (CHF), which was piloted for the first time in five provinces of Afghanistan between June 2005 and October 2006. The performance of the CHF programme demonstrates that complex community-based health financing schemes can be implemented in post-conflict settings like Afghanistan, except in areas of high insecurity. The funds raised from the community, via premiums and user fees, enabled the pilot facilities to overcome temporary shortages of drugs and supplies, and to conduct outreach services via mobile clinics. However, enrolment and cost-recovery were modest. The median enrolment rate for premium-paying households was 6% of eligible households in the catchment areas of the clinics. Cost recovery rates ranged up to 16% of total operating costs and 32% of non-salary operating costs. No evidence of reduced out-of-pocket health expenditures was observed at the community level, though CHF members had markedly higher utilization of health services. The main reasons among non-members for not enrolling were being unaware of the programme; high premiums; and perceived low quality of services at the CHF clinics. The performance of Afghanistan's CHF was similar to other CHF-type programmes operating at the primary care level internationally. The solution to building local capacity to finance health services lies in a combination of financing sources rather than any single mechanism. In this context, it is critical that international assistance for Afghanistan's health sector continues.

The economic impact of exposure to secondhand smoke in Minnesota.

OBJECTIVES: Using the risk categories established by the 2006 US surgeon general's report, we estimated medical treatment costs related to exposure to secondhand tobacco smoke (SHS) in the state of Minnesota. METHODS: We estimated the prevalence and costs of treated medical conditions related to SHS exposure in 2003 with data from Blue Cross and Blue Shield (Minnesota's largest insurer), the Current Population Survey, and population attributable risk estimates for these conditions reported in the scientific literature. We adjusted treatment costs to the state level by health insurance category by using the Medical Expenditure Panel Survey. RESULTS: The total annual cost of treatment in Minnesota for conditions for which the 2006 surgeon general's report found sufficient evidence to conclude a causal link with exposure to SHS was $228.7 million in 2008 dollars-equivalent to $44.58 per Minnesota resident. Sensitivity analyses showed a range from $152.1 million to $330.0 million. CONCLUSIONS: The results present a strong rationale for regulating smoking in public places and were used to support the passage of Minnesota's Freedom to Breathe Act of 2007.

The effect of wealth status on care seeking and health expenditures in Afghanistan.

This paper analyses the effect of wealth status on care-seeking patterns and health expenditures in Afghanistan, based on a national household survey conducted within public health facility catchment areas. We found high rates of reported care-seeking, with more than 90% of those ill seeking care. Sick individuals from all wealth quintiles had high rates of care-seeking, although those in the wealthiest quintile were more likely to seek care than those from the poorest (odds ratio 2.2; 95% CI 1.6, 3.0). The nearest clinic providing the government's Basic Package of Health Services (BPHS) was the most commonly sought first provider (53% overall), especially for relatively poor households (62% in poorest vs. 42% in least poor quintile, P < 0.0001). Sick individuals from wealthier quintiles used hospitals and for-profit private providers more than those in poorer quintiles. Multivariate analysis showed that wealth quintile was the strongest predictor of seeking care, and of going first to private providers. More than 90% of those seeking care paid money out-of-pocket. Mean (median) expenditures among those paying for care in the previous month were 873 Afghanis (200 Afghanis), equivalent to US$17.5 (US$4). Expenditures were lowest at BPHS clinics and highest at private providers. Financing care through borrowing money or selling assets/land ('any distress' financing) was reported in nearly 30% of cases and was almost twice as high among households in the poorest versus the least poor quintile (P < 0.0001). Financing care through selling assets/land ('severe distress' financing) was less common (10% overall) and did not differ by wealth status. These findings indicate that BPHS facilities are being used by the poor who live close to them, but further research is needed to assess utilization among populations in more remote areas. The high out-of-pocket health expenditures, particularly for private sector services, highlight the need to develop financial protection mechanisms in Afghanistan.

Managed care and private health insurance in a global context.

This article provides an overview of the current role of private health insurance and private care management organizations around the globe. We describe past experiences and challenges associated with the export of U.S.-style managed care. We provide a framework for understanding the potential opportunities within a national health system for expanding managed care approaches and also private health insurance more generally. This article is relevant to both the United States and members of the international community.

Economic analysis of childhood pneumonia in Northern Pakistan.

OBJECTIVES: This study estimates household costs for treatment of pneumonia, severe pneumonia and very severe febrile disease. Combined with reported costs from the health care provider perspective, an estimate of the overall financial burden of these diseases has been developed for the Northern Areas of Pakistan. METHODS: Data on the duration and economic implications of the illnesses for households were collected from caretakers of children under 3 years of age enrolled in a surveillance study who sought care at a health facility. Trained study physicians and health workers identified children with pneumonia, severe pneumonia and very severe febrile disease--as defined by protocols for the Integrated Management of Childhood Illness (IMCI). RESULTS: From January to December 2002, 141 health facility visits for pneumonia (n = 41, 29%), severe pneumonia (n = 65, 46%) and very severe febrile disease (n = 35, 25%) were recorded for 112 children who sought care at various levels of health facilities in the Northern Areas of Pakistan. The total societal average cost per episode was US$22.62 for pneumonia, US$142.90 for severe pneumonia and US$62.48 for very severe febrile disease. For household expenditures, medicines constituted the highest proportion (40.54%) of costs incurred during a visit to the health facility, followed by meals (23.68%), hospitalization (13.23%) and transportation (12.19%). CONCLUSION: Pneumonia is one of the leading killers of children in Pakistan with a correspondingly high economic burden to society. The results of this study suggest that there is a strong economic justification for expanding the availability of existing interventions to fight pneumonia, and for introducing measures such as vaccines to prevent pneumonia episodes.

Health insurance coverage in Central and Eastern Europe: trends and challenges.

Health insurance systems in Central and Eastern Europe have evolved in different ways from the centralized health systems inherited from the Soviet era, but there remain common trends and challenges in the region. Health spending is low in comparison to the spending of pre-2004 European Union members, but population aging, medical technology, economic growth, and heightened expectations will generate major spending pressures. Social health insurance is the dominant model in the region, but coverage is uneven. Key3reform issues include identifying ways to encourage additional investment in the health sector; and defining formal benefit packages, copayments, and the role of private insurance.

The costs of non-insurance in Maryland.

OBJECTIVES: This study calculates expenditures and costs related to a lack of health insurance coverage in the State of Maryland. RESEARCH METHODS: The study is based on detailed primary and secondary data collection on the following sources of payment and care related to non-insurance: (1) uncompensated hospital care; (2) other public subsidies; (3) ambulatory services; (4) philanthropic spending; and (5) uninsured individuals' costs. RESULTS: Expenditures by and for the uninsured in Maryland total $1.47 billion dollars. On a per-capita basis, this is equivalent to $2,371 per full-year uninsured person in the state. Twenty-seven percent of this total, or $633 per uninsured person, is paid directly by the uninsured themselves in out-of-pocket medical expenditures. The state and local governments spent $497 per uninsured person (21% of the total), and the federal government spent an additional $401 (17%). Private payers (including insurance, physicians, and philanthropy) accounted for $460 (19%). CONCLUSIONS: The sources and flows of spending on the uninsured are complex, and these expenditure levels should not be interpreted as savings that would directly result from an expansion of insurance coverage. Our results are consistent with earlier studies completed at the national level, and add considerable detail.

The cost of treatment for child pneumonias and meningitis in the Northern Areas of Pakistan.

Pneumonia, meningitis, and sepsis place a significant economic burden on health care systems, particularly in developing countries. This study estimates treatment costs for these diseases in health facilities in the Northern Areas of Pakistan. Health facility resources are organized by categories--including salaries, capital costs, utilities, overhead, maintenance and supplies--and quantified using activity-based costing (ABC) techniques. The average cost of treatment for an outpatient case of child pneumonia is dollar 13.44. For hospitalized care, the health system spent an average of dollar 71 per episode for pneumonia, dollar 235 for severe pneumonia, and dollar 2,043 for meningitis. These costs provide important background information for the potential introduction of the conjugate Haemophilus influenzae type b (Hib) and Streptococcus pneumoniae vaccines in Pakistan.