The increasing costs of medicines and their implications for patients, physicians and the health system.

Most new medicines entering the market are high-cost speciality drugs. These drugs can cost tens to hundreds of thousands of dollars per course of treatment and in some cases millions of dollars per dose. Approximately half of all spending on medicines is projected to target only 2-3% of patients, raising important questions about resource allocation. While there is no doubt that breakthrough innovations have transformed clinical care in some disciplines, it is also true that cost is becoming one of the primary barriers to treatment access and that many new medicines do not provide value commensurate with their prices. This article examines pricing trends, the reasons for high prices and their implications for access and clinical practice.

Multivariable Cost Frontiers-Qualitative Financial Analyses Using Operational Metrics From the Implementation of a Surgery Fellowship.

OBJECTIVE: We expand the application of cost frontiers and introduce a novel approach using qualitative multivariable financial analyses. SUMMARY BACKGROUND DATA: With the creation of a 5 + 2-year fellowship program in July 2016, the Division of Vascular Surgery at the University of Vermont Medical Center altered the underlying operational structure of its inpatient services. METHOD: Using WiseOR (Palo Alto, CA), a web-based OR management data system, we extracted the operating room metrics before and after August 1, 2016 service for each 4-week period spanning from September 2015 to July 2017. The cost per minute modeled after Childers et al's inpatient OR cost guidelines was multiplied by the after-hours utilization to determine variable cost. Zones with corresponding cutoffs were used to graphically represent cost efficiency trends. RESULTS: Caseload/FTE for attending surgeons increased from 11.54 cases per month to 13.02 cases per month ( P = 0.0771). Monthly variable costs/FTE increased from $540.2 to $1873 ( P = 0.0138). Monthly revenue/FTE increased from $61,505 to $70,277 ( P = 0.2639). Adjusted monthly reve-nue/FTE increased from $60,965 to $68,403 ( P = 0.3374). Average monthly percent of adjusted revenue/FTE lost to variable costs increased from 0.85% to 2.77% ( P = 0.0078). Adjusted monthly revenue/case/FTE remained the same from $5309 to $5319 ( P = 0.9889). CONCLUSION: In summary, we demonstrate that multivariable cost (or performance) frontiers can track a net increase in profitability associated with fellowship implementation despite diminishing returns at higher caseloads.

Monitoring institutions in healthcare markets: Experimental evidence.

This paper investigates the impact of monitoring institutions on market outcomes in health care. Healthcare markets are characterized by asymmetric information. Physicians have an information advantage over patients with respect to appropriate treatments, which they may exploit through over- or under-provision or by overcharging. We introduce two types of costly monitoring: endogenous and exogenous monitoring. When monitoring detects misbehavior, physicians have to pay a fine. Endogenous monitoring can be requested by patients, while exogenous monitoring is performed randomly by a third party. We present a toy model that enables us to derive hypotheses and test them in a laboratory experiment. Our results show that introducing endogenous monitoring reduces the level of undertreatment and overcharging. Even under high monitoring costs, the threat of patient monitoring is sufficient to discipline physicians. Exogenous monitoring also reduces undertreatment and overcharging when performed sufficiently frequently. Market efficiency increases when endogenous monitoring is introduced and when exogenous monitoring is implemented with sufficient frequency. Our results suggest that monitoring may be a feasible instrument to improve outcomes in healthcare markets.

Comparing costs of a senior wellness care redesign in group and independent physician practices of an accountable care organization.

Primary care redesign for older adult patients is currently ongoing in countries with aging populations. One of the main challenges of this type of transformations is how to estimate implementation costs in different types of health care delivery organizations. This study compares start-up and incremental expenses of implementing a primary care redesign across 2 organization types: integrated group (n = 31) practices and independent practice association (IPA) sites (n = 213). Administrators involved with implementing the redesign completed a cost capture template to quantifying expenses. The potential impact of measurement error, recollection bias, and implementation models across sites and geographic regions was examined in sensitivity analyses. Marginal start-up and incremental expenses were higher for Group sites ($122-$328) compared to IPA sites ($31-$227). Group and IPA sites, however, implemented the redesign with different intensities. According to our analyses, if IPA sites implemented the redesign with the same intensity as Group sites, marginal costs would have been $5 to $13 higher for IPA sites than for Group sites. This study shows how a flexible approach to estimate the cost of a wellness care redesign is needed when the intensity of the transformation differs across 2 different types of health care organizations.

Even Small Employers Are Striking Out on Their Own.

Several factors are at work. Group health insurance got more expensive when the ACA mandated essential health benefits and no-cost preventive care. Some small companies dropped coverage altogether, but now they are coming back into the fold as the employment market has tightened up, say brokers. Starting fresh, they have a chance to consider self-insurance.

Working time costs of doctors-therapists of divisionals on a patient.

AIM: The aim of this article is to establish a weighted average costs of the workflow of the doctor-the therapist of the district, providing primary health care to the population in the outpatient setting to determine the costs when you visit one patient. MATERIALS AND METHODS: Held fotohronometra working process research 39 physicians in the 17th precinct pilot areas from all Federal districts. Within fotohronometra research conducted 6474 measurement. RESULTS: The average time a physician of the district while visiting a patient in a medical organization made up of 15.30±2.0 min, while visiting at home - 32.5±2.0 min the Largest proportion of the working time of the doctor-the therapist of the district while visiting a patient in the outpatient setting is necessary to work with medical records (47.31%). On core activities while visiting a patient in the practitioner, the district spends to 45.54% of the time. For other activities - 7.15%. CONCLUSION: As a result fotohronometra research workflow of doctors-therapists of district, providing primary health care in outpatient settings, set the average time a physician of the district while visiting one patient (15.30±2.0 min), while visiting at home (32.5±2.0 min).

Comparing time and motion methods to study personnel time in the context of a family planning supply chain intervention in Senegal.

BACKGROUND: A family planning (FP) supply chain intervention was introduced in Senegal in 2012 to reduce contraceptive stock-outs. Labour is the highest cost in low- and middle-income country supply chains. In this paper, we (1) understand time use of personnel working in the FP supply chain at health facilities in Senegal, (2) estimate the validity of self-administered timesheets (STs) relative to continuous observations (COs), and (3) describe the cost of data collection for each method. METHODS: We collected time use data for seven stockroom managers in six facilities using both ST and CO. Activities were categorized as follows: stock management associated with FP, non-FP stock management, other productive activities, non-productive activities, and waiting time. Paired t tests were used to compare the mean differences between the two methods in all categories and in productive time alone. RESULTS: Among all activities, the absolute and relative time spent on productive activities was higher when estimated by ST compared to CO. Conversely, waiting time was underestimated by STs. There was no difference in the relative time spent on non-productive activities. When comparing the distribution of the three productive activity categories, we found no evidence of a difference in relative time percentage estimates between CO and ST (FP stockroom management - 3.0%, 95% CI - 7.4 to 1.4%; non-FP stockroom management 3.4%, 95% CI - 2.8 to 9.6%; and other productive activities - 0.1%, 95% CI - 6.3 to 6.0%). Data collection costs for CO are 140% more than ST. CONCLUSION: STs were not a reliable method for measuring absolute labour time at health facilities in Senegal due to considerable underestimates of time waiting for clients. However, ST had acceptable reliability when examining distribution of productive time. Although CO provides more accurate absolute time estimates, the unit costs for data collection using this method are more than triple those for STs in Senegal.

Four-year review of presenteeism data among employees of a large United States health care system: a retrospective prevalence study.

BACKGROUND: Historically, in an effort to evaluate and manage the rising cost of healthcare employers assess the direct cost burden via medical health claims and measures that yield clear data. Health related indirect costs are harder to measure and are often left out of the comprehensive overview of health expenses to an employer. Presenteeism, which is commonly referred to as an employee at work who has impaired productivity due to health considerations, has been identified as an indirect but relevant factor influencing productivity and human capitol. The current study evaluated presenteeism among employees of a large United States health care system that operates in six locations over a four-year period and estimated loss productivity due to poor health and its potential economic burden. METHODS: The Health-Related Productivity Loss Instrument (HPLI) was included as part of an online Health Risk Appraisal (HRA) administered to employees of a large United States health care system across six locations. A total of 58 299 HRAs from 22 893 employees were completed and analyzed; 7959 employees completed the HRA each year for 4 years. The prevalence of 22 specific health conditions and their effects on productivity areas (quantity of work, quality of work, work not done, and concentration) were measured. The estimated daily productivity loss per person, annual cost per person, and annual company costs were calculated for each condition by fitting marginal models using generalized estimating equations. Intra-participant agreement in reported productivity loss across time was evaluated using κ statistics for each condition. RESULTS: The health conditions rated highest in prevalence were allergies and hypertension (high blood pressure). The conditions with the highest estimated daily productivity loss and annual cost per person were chronic back pain, mental illness, general anxiety, migraines or severe headaches, neck pain, and depression. Allergies and migraines or severe headaches had the highest estimated annual company cost. Most health conditions had at least fair intra-participant agreement (κ ≥ 0.40) on reported daily productivity loss. CONCLUSIONS: Results from the current study suggested a variety of health conditions contributed to daily productivity loss and resulted in additional annual estimated costs for the health care system. To improve the productivity and well-being of their workforce, employers should consider presenteeism data when planning comprehensive wellness initiatives to curb productivity loss and increase employee health and well-being during working hours.

Strategies to alleviate shortages of nurses in adult social care.

A lack of investment in adult social care has led to major staffing problems in care homes, according to a new report from the National Audit Office, as Emeritus Professor Alan Glasper, University of Southampton, explains.

Nurse practitioners provide quality primary care at a lower cost than physicians.

The growing need for primary care providers has opened the door for nurse practitioners to fill the void. Nursing students are rushing to get nurse practitioner degrees, and researchers are working to keep pace with studies. Most of the results provide evidence for expanded use of nurse practitioners in a variety of settings.

The potential of task-shifting in scaling up services for prevention of mother-to-child transmission of HIV: a time and motion study in Dar es Salaam, Tanzania.

BACKGROUND: In many African countries, prevention of mother-to-child transmission of HIV (PMTCT) services are predominantly delivered by nurses. Although task-shifting is not yet well established, community health workers (CHWs) are often informally used as part of PMTCT delivery. According to the 2008 World Health Organization (WHO) Task-shifting Guidelines, many PMTCT tasks can be shifted from nurses to CHWs. METHODS: The aim of this time and motion study in Dar es Salaam, Tanzania, was to estimate the potential of task-shifting in PMTCT service delivery to reduce nurses' workload and health system costs. The time used by nurses to accomplish PMTCT activities during antenatal care (ANC) and postnatal care (PNC) visits was measured. These data were then used to estimate the costs that could be saved by shifting tasks from nurses to CHWs in the Tanzanian public-sector health system. RESULTS: A total of 1121 PMTCT-related tasks carried out by nurses involving 179 patients at ANC and PNC visits were observed at 26 health facilities. The average time of the first ANC visit was the longest, 54 (95% confidence interval (CI) 42-65) min, followed by the first PNC visit which took 29 (95% CI 26-32) minutes on average. ANC and PNC follow-up visits were substantially shorter, 15 (95% CI 14-17) and 13 (95% CI 11-16) minutes, respectively. During both the first and the follow-up ANC visits, 94% of nurses' time could be shifted to CHWs, while 84% spent on the first PNC visit and 100% of the time spent on the follow-up PNC visit could be task-shifted. Depending on CHW salary estimates, the cost savings due to task-shifting in PMTCT ranged from US$ 1.3 to 2.0 (first ANC visit), US$ 0.4 to 0.6 (ANC follow-up visit), US$ 0.7 to 1.0 (first PNC visit), and US$ 0.4 to 0.5 (PNC follow-up visit). CONCLUSIONS: Nurses working in PMTCT spend large proportions of their time on tasks that could be shifted to CHWs. Such task-shifting could allow nurses to spend more time on specialized PMTCT tasks and can substantially reduce the average cost per PMTCT patient.

Trends in Reported Health Care Affordability for Men and Women With Employer-Sponsored Health Insurance Coverage in the US, 2000 to 2020.

This study uses National Health Interview Survey data from 2000 to 2020 to examine reported differences between US men and women aged 19 to 64 years with employer-sponsored insurance in obtaining affordable health care.

The high cost of clinical negligence litigation in the NHS.

John Tingle, Reader in Health Law at Nottingham Trent University, discusses a consultation document from the Department of Health on introducing fixed recoverable costs in lower-value clinical negligence claims.

Effects of New Funding Models for Patient-Centered Medical Homes on Primary Care Practice Finances and Services: Results of a Microsimulation Model.

PURPOSE: We assess the financial implications for primary care practices of participating in patient-centered medical home (PCMH) funding initiatives. METHODS: We estimated practices' changes in net revenue under 3 PCMH funding initiatives: increased fee-for-service (FFS) payments, traditional FFS with additional per-member-per-month (PMPM) payments, or traditional FFS with PMPM and pay-for-performance (P4P) payments. Net revenue estimates were based on a validated microsimulation model utilizing national practice surveys. Simulated practices reflecting the national range of practice size, location, and patient population were examined under several potential changes in clinical services: investments in patient tracking, communications, and quality improvement; increased support staff; altered visit templates to accommodate longer visits, telephone visits or electronic visits; and extended service delivery hours. RESULTS: Under the status quo of traditional FFS payments, clinics operate near their maximum estimated possible net revenue levels, suggesting they respond strongly to existing financial incentives. Practices gained substantial additional net annual revenue per full-time physician under PMPM or PMPM plus P4P payments ($113,300 per year, 95% CI, $28,500 to $198,200) but not under increased FFS payments (-$53,500, 95% CI, -$69,700 to -$37,200), after accounting for costs of meeting PCMH funding requirements. Expanding services beyond minimum required levels decreased net revenue, because traditional FFS revenues decreased. CONCLUSIONS: PCMH funding through PMPM payments could substantially improve practice finances but will not offer sufficient financial incentives to expand services beyond minimum requirements for PCMH funding.

A discrete choice experiment studying students' preferences for scholarships to private medical schools in Japan.

BACKGROUND: The shortage of physicians in rural areas and in some specialties is a societal problem in Japan. Expensive tuition in private medical schools limits access to them particularly for students from middle- and low-income families. One way to reduce this barrier and lessen maldistribution is to offer conditional scholarships to private medical schools. METHODS: A discrete choice experiment is carried out on a total of 374 students considering application to medical schools. The willingness to receive a conditional scholarship program to private medical schools is analyzed. RESULTS: The probability of attending private medical schools significantly decreased because of high tuition, a postgraduate obligation to provide a service in specific specialty areas, and the length of time of this obligation. An obligation to provide a service in rural regions had no significant effect on this probability. To motivate non-applicants to private medical schools to enroll in such schools, a decrease in tuition to around 1.2 million yen (US$ 12,000) or less, which is twice that of public schools, was found to be necessary. Further, it was found that non-applicants to private medical schools choose to apply to such schools even with restrictions if they have tuition support at the public school level. CONCLUSIONS: Conditional scholarships for private medical schools may widen access to medical education and simultaneously provide incentives to work in insufficiently served areas.

Costs of accountable care organization participation for primary care providers: early stage results.

BACKGROUND: Little is known about the impact of joining an Accountable Care Organization (ACO) on primary care provider organization's costs. The purpose of this study was to determine whether joining an ACO is associated with an increase in a Rural Health Clinic's (RHC's) cost per visit. METHODS: The analyses focused on cost per visit in 2012 and 2013 for RHCs that joined an ACO in 2012 and cost per visit in 2013 for RHCs that joined an ACO in 2013. The RHCs were located in nine states. Data were obtained from Medicare Cost Reports. The analysis was conducted taking a treatment effects approach where the treatment is joining an ACO. Propensity-score matching was employed to provide multiple single and pooled estimates of the average treatment effect on the treated. RESULTS: Four-hundred thirty four to 544 RHCs (depending on the type of analysis and the variables used) were used in the several analyses. Seven of the RHCs joined an ACO in 2012 and 14 joined an ACO in 2013. The mean cost per visit for RHCs that did not join an ACO rose 4.40 % from 2011 to 2012 whereas the mean cost per visit for RHCs that joined an ACO rose by triple: 13.5 %. All of the pooled estimates of the average treatment effect on the treated from the propensity-score matching showed that joining an ACO was associated with higher mean cost per visit. The range of the estimated mean cost per visit differences was $17.19 (p value = 0.00) to $25.19 (p value = 0.00). CONCLUSIONS: This study is one of the first to describe the cost of ACO participation from the perspective of primary care provider organizations. It appears that for at least one type of primary care provider - the RHC - there are substantial costs associated with ACO participation during the first two years.

The "Cadillac Tax" on Health Benefits in the United States Will Hit the Middle Class Hardest: Refuting the Myth That Health Benefit Tax Subsidies Are Regressive.

U.S. employment-based health benefits are exempt from income and payroll taxes, an exemption that provided tax subsidies of $326.2 billion in 2015. Both liberal and conservative economists have denounced these subsidies as "regressive" and lauded a provision of the Affordable Care Act­the Cadillac Tax­that would curtail them. The claim that the subsidies are regressive rests on estimates showing that the affluent receive the largest subsidies in absolute dollars. But this claim ignores the standard definition of regressivity, which is based on the share of income paid by the wealthy versus the poor, rather than on dollar amounts. In this study, we calculate the value of tax subsidies in 2009 as a share of income for each income quintile and for the wealthiest Americans. In absolute dollars, tax subsidies were highest for families between the 80th and 95th percentiles of family income and lowest for the poorest 20%. However, as shares of income, subsidies were largest for the middle and fourth income quintiles and smallest for the wealthiest 0.5% of Americans. We conclude that the tax subsidy to employment-based insurance is neither markedly regressive, nor progressive. The Cadillac Tax will disproportionately harm families with (2009) incomes between $38,550 and $100,000, while sparing the wealthy.