An unintended consequence of provider payment reform: The case of capitation grants in the National Health Insurance reform of Indonesia.

One of the most important components of the ambitious 2014 National Health Insurance reform in Indonesia is the implementation of prospective payment system known as capitation grants, paid monthly to the primary health providers based on the enrolment rate. This has ushered in additional financial resources for the health managers in resource allocations, especially in the hiring of manpower. Drawing data from the Indonesia Family Life Survey (1993-2015), this paper uses difference-in-differences method to evaluate the effects of the payment method reform on the allocation of human resources for health among the primary health providers. To our surprise, there was no statistically significant change in the total number of full-time staff among the capitated facilities after the reform. However, capitation grants caused an increase in the number of full-time equivalent and part-time equivalent contract staff, but a significant decline in the number of full-time permanent staff among the urban capitated facilities. It is likely that more contract health workers were hired at the expense of full-time permanent staff among the capitated facilities in the urban regions. This unintended consequence shed light on the need to develop nuanced and contextual understanding of payment reforms in developing countries.

Does One Size Fit All With the Effects of Payment Reform? Dialysis Facility Payer Mix and Anemia Management Under the Expanded Medicare Prospective Payment System.

BACKGROUND: The effects of Medicare payment reforms aiming to improve the efficiency and quality of care by establishing greater financial accountability for providers may vary based on the extent and types of other coverage for their patient populations. Providers who are more resource constrained due to a less favorable payer mix face greater financial risks under such reforms. The impact of the expanded Medicare dialysis prospective payment system (PPS) on quality of care in independent dialysis facilities may vary based on the extent of higher payments from private insurers available for managing increased risks. OBJECTIVES: To evaluate whether anemia outcomes for dialysis patients in independent facilities differ under the Medicare PPS based on facility payer mix. DESIGN: We examined changes in anemia outcomes for 122,641 Medicare dialysis patients in 921 independent facilities during 2009-2014 among facilities with differing levels of employer insurance (EI). We performed similar analyses of facilities affiliated with large dialysis organizations, whose practices were not expected to change based on facility-specific payer mix. RESULTS: Among independent facilities, similar modeled trends in low hemoglobin for all 3 facility EI groups in 2009-2010 were followed by increased low hemoglobin during 2012-2014 for facilities with lower EI (P<0.01). Post-PPS standardized blood transfusion ratios were 9% higher for lower EI versus higher EI independent facilities (P<0.01). Among large dialysis organizations facilities, there was no divergence in low hemoglobin by payer mix under the PPS. CONCLUSIONS: There is evidence of poorer quality of care for anemia under the PPS in independent facilities with lower versus higher EI. Provider responses to payment reform may vary based on attributes such as payer mix that could have implications for health disparities.

Are cost differences between specialist and general hospitals compensated by the prospective payment system?

Prospective payment systems fund hospitals based on a fixed-price regime that does not directly distinguish between specialist and general hospitals. We investigate whether current prospective payments in England compensate for differences in costs between specialist orthopaedic hospitals and trauma and orthopaedics departments in general hospitals. We employ reference cost data for a sample of hospitals providing services in the trauma and orthopaedics specialty. Our regression results suggest that specialist orthopaedic hospitals have on average 13% lower profit margins. Under the assumption of break-even for the average trauma and orthopaedics department, two of the three specialist orthopaedic hospitals appear to make a loss on their activity. The same holds true for 33% of departments in our sample. Patient age and severity are the main drivers of such differences.

Primary Care Pharmacist Services Align With Payment Reform and Provider "Joy of Practice".

The implementation and expansion of primary care (PC) pharmacist medication optimization and management services has been hindered mainly by the lack of a payment mechanism for PC providers to engage pharmacist services. If pharmacists expect to be included in new PC team-based payment models, we need to actively engage in ongoing PC practice transformation discussions with PC organizational leaders. In this commentary, examples of integrated PC pharmacist services and payment models are provided to (1) reinforce the feasibility of pharmacist integration into expanded PC teams and (2) share with PC leaders, payers, and policy makers.

Managing imperfect competition by pay for performance and reference pricing.

I study a managed health service market where differentiated providers compete for consumers by choosing multiple service qualities, and where copayments that consumers pay and payments that providers receive for services are set by a payer. The optimal regulation scheme is two-sided. On the demand side, it justifies and clarifies value-based reference pricing. On the supply side, it prescribes pay for performance when consumers misperceive service benefits or providers have intrinsic quality incentives. The optimal bonuses are expressed in terms of demand elasticities, service technology, and provider characteristics. However, pay for performance may not outperform prospective payment when consumers are rational and providers are profit maximizing, or when one of the service qualities is not contractible.

Los contratos de riesgo compartido en el sistema nacional de salud: percepciones de los profesionales sanitarios / Risk sharing contracts in the national health care system: perceptions of health care professionals

Fundamentos: Los contratos de riesgo compartido (CRC) presentan un novedoso instrumento de gestión sanitaria que condiciona el pago a la compañía farmacéutica dependiendo de si el paciente tratado con su fármaco es curado con éxito. El objetivo de este trabajo fue conocer la percepción de los profesionales sanitarios acerca de la utilidad de dichos acuerdos en el Sistema Nacional de Salud español. Métodos: Se diseñó un cuestionario para realizar una serie de entrevistas semiestructuradas con profesionales de farmacia hospitalaria, laboratorio y oncología de hospitales españoles de Madrid, Aragón, Castilla-La Mancha, Castilla y León, Cataluña, La Rioja, País Vasco y Navarra. El criterio de selección fue de conveniencia. El periodo de realización de las entrevistas fue de abril a noviembre de 2017. Se efectuó un análisis cualitativo a partir de las respuestas de 14 entrevistas. Resultados: Todos los encuestados afirmaron que los CRC permiten mejorar la gestión económica y administrativa del hospital, destacando el control presupuestario, la obtención de financiación y la posibilidad de ahorro como ventajas principales. Los CRC son percibidos (13 de 14 entrevistados) como acuerdos con implicaciones positivas para la salud porque aumentaban el portfolio de tratamientos disponibles y porque los tratamientos introducidos contaban con una mayor eficacia. La necesidad de los CRC de registrar a los pacientes implicaba un seguimiento y control que también se entendió contribuía a la mejora de su salud. Además, los CRC se creyó (8 de 14 entrevistados) que favorecían la introducción de la medicina personalizada (MP) ya que tanto la MP como los CRC dependen e impulsan la elaboración de pruebas diagnósticas, ya sea por motivos de cribado (MP) o de aumentar las evidencias clínicas para mejorar los resultados económicos (CRC). No obstante, se consideró que la firma de los CRC conlleva la necesidad de modificar ciertas normativas (5 de 14 entrevistados), de aumentar las plantillas para encargarse de tareas burocráticas, como la elaboración de registros, y también de incrementar las pruebas de laboratorio, lo cual puede complicar la gestión sanitaria. Conclusiones: En general, los CRC contaron con opiniones positivas acerca de su aplicación aunque deba trabajarse para mejorar el contexto normativo y organizativo de modo que la complejidad adicional que incorporan no constituya una traba para extender su uso. Además, se detectaron sinergias entre los CRC y la MP

Background: Risk-sharing contracts (RSC) present a novel management tool, which link the payment to the pharmaceutical company to health outcomes. The objective of this work was to know the perception of health professionals about the utility of these agreements in the Spanish National Health System. Methods: A questionnaire was designed to conduct a series of semi-structured interviews with hospital pharmacy, laboratory and oncology professionals from Spanish hospitals in Madrid, Aragón, Castilla-La Mancha, Castilla y León, Cataluña, La Rioja, País Vasco and Navarra. The selection criteria was for convenience. The interview period was from April to November 2017. A qualitative analysis was performed based on the responses from 14 interviews. Results: All the surveyed affirmed that the CRCs allow to improve the economic and administrative management of the hospital, emphasizing as main advantages the budgetary control, the obtaining of funding and the savings possibilities. CRCs are perceived (13 of 14 respondents) as agreements with positive health implications because they increased the portfolio of treatments and had greater efficacy. The need for CRCs to register patients, involved monitoring and control, also contributed to the improvement of their health. In addition, CRCs were believed (8 out of 14 respondents) to facilitate the introduction of personalized medicine (MP) as both depend on diagnostic tests, one for screening reasons (MP) and the other for obtain clinical evidences that improve economic outcomes (CRC). However, it was considered that signing the CRCs entails the need to modify certain regulations (5 out of 14 respondents) as well as to increase the number of staff to handle bureaucratic tasks and to increase laboratory tests, which can complicate health management. Conclusions: Qualitative social research techniques have proven to be useful for gathering information on a new topic and understanding the perception of the advantages and disadvantages of CRCs, as well as their association with the MP. In addition, synergies were detected between the CRCs and the MP. Respondents had positive opinions on CRCs about its application, although work must be done in order to improve the normative and organizational context so that the additional complexity that they incorporate does not constitute an obstacle to extend its use

Competition in the Dutch hospital sector: an analysis of health care volume and cost.

This paper evaluates the impact of market competition on health care volume and cost. At the start of 2005, the financing system of Dutch hospitals started to be gradually changed from a closed-end budgeting system to a non-regulated price competitive prospective reimbursement system. The gradual implementation of price competition is a 'natural experiment' that provides a unique opportunity to analyze the effects of market competition on hospital behavior. We have access to a unique database, which contains hospital discharge data of diagnosis treatment combinations (DBCs) of individual patients, including detailed care activities. Difference-in-difference estimates show that the implementation of market-based competition leads to relatively lower total costs, production volume and number of activities overall. Difference-in-difference estimates on treatment level show that the average costs for outpatient DBCs decreased due to a decrease in the number of activities per DBC. The introduction of market competition led to an increase of average costs of inpatient DBCs. Since both volume and number of activities have not changed significantly, we conclude that the cost increase is likely the result of more expensive activities. A possible explanation for our finding is that hospitals look for possible efficiency improvements in predominantly outpatient care products that are relatively straightforward, using easily analyzable technologies. The effects of competition on average cost and the relative shares of inpatient and outpatient treatments on specialty level are significant but contrary for cardiology and orthopedics, suggesting that specialties react differently to competitive incentives.