Scope and Incentives for Risk Selection in Health Insurance Markets With Regulated Competition: A Conceptual Framework and International Comparison.

In health insurance markets with regulated competition, regulators face the challenge of preventing risk selection. This paper provides a framework for analyzing the scope (i.e., potential actions by insurers and consumers) and incentives for risk selection in such markets. Our approach consists of three steps. First, we describe four types of risk selection: (a) selection by consumers in and out of the market, (b) selection by consumers between high- and low-value plans, (c) selection by insurers via plan design, and (d) selection by insurers via other channels such as marketing, customer service, and supplementary insurance. In a second step, we develop a conceptual framework of how regulation and features of health insurance markets affect the scope and incentives for risk selection along these four dimensions. In a third step, we use this framework to compare nine health insurance markets with regulated competition in Australia, Europe, Israel, and the United States.

Amortization of gene replacement therapies: A health policy analysis exploring a mechanism for mitigating budget impact of high-cost treatments.

With gene replacement therapies (GRTs) increasingly and rapidly reaching the healthcare marketplace, the vast potential for improving patient health is matched by the potential budgetary impact for healthcare payers. GRTs are highly valuable given their potential life-extending or even curative benefits and may provide significant cost-offsets compared with standard of care. Current healthcare systems are, however, struggling to fund such valuable but costly therapies. Some payers have already implemented specific financing models to account for the new treatment paradigms, but these do not address the budget impact in the year of acquisition or administration of these costly technologies. This health policy analysis aimed to assess the rationale and feasibility of amortization, within the context of financing healthcare technologies, and specifically GRTs. Amortization is an accounting concept applied to intangible assets that allows for spreading the cost an intangible asset over time, allowing for repayment to occur via interest and principal payments sufficient to repay the intangible asset in full by its maturity. Our systematic scoping review on the amortization of healthcare technologies found a very small literature base with even that being unclear and inconsistent in its understanding of the issues. Where amortization was proposed as a solution for funding costly, but highly valuable GRTs, the concept was not fully investigated in detail, nor was the feasibility of the approach fully challenged. However, by providing clear definitions of relevant concepts along with an example of amortization models applied to some example GRTs, we propose that amortization can offer a promising method for funding of extraordinarily high-value healthcare technologies, thereby increasing market and patient access for these technologies. Nonetheless, healthcare accounting principles and financing guidelines must evolve to apply amortization to the rapidly developing GRTs.

A complex intervention to promote prevention of delirium in older adults by targeting caregiver's participation during and after hospital discharge - study protocol of the TRAnsport and DElirium in older people (TRADE) project.

BACKGROUND: Among potentially modifiable risk factors for delirium, transfers between wards, hospitals and other facilities have been mentioned with low evidence. TRADE (TRAnsport and DElirium in older people) was set up to investigate i) the impact of transfer and/or discharge on the onset of delirium in older adults and ii) feasibility and acceptance of a developed complex intervention targeting caregiver's participation during and after hospital discharge or transfer on cognition and the onset of delirium in older adults. METHODS: The study is designed according to the guidelines of the UK Medical Research Council (MRC) for development and evaluation of complex interventions and comprises two steps: development and feasibility/piloting. The development phase includes i) a multicenter observational prospective cohort study to assess delirium incidence and cognitive decline associated with transfer and discharge, ii) a systematic review of the literature, iii) stakeholder focus group interviews and iv) an expert workshop followed by a Delphi survey. Based on this information, a complex intervention to better and systematically involve family caregivers in discharge and transport was developed. The intervention will be tested in a pilot study using a stepped wedge design with a detailed process and health economic evaluation. The study is conducted at four acute care hospitals in southwest Germany. Primary endpoints are the delirium incidence and cognitive function. Secondary endpoints include prevalence of caregiver companionship, functional decline, cost and cost effectiveness, quality of discharge management and quality of admission management in admitting hospitals or nursing homes. Data will be collected prior to discharge as well as after 3, 7 and 90 days. DISCUSSION: TRADE will help to evaluate transfer and discharge as a possible risk factor for delirium. In addition, TRADE evaluates the impact and modifiability of caregiver's participation during patient's transfer or discharge on delirium incidence and cognitive decline providing the foundation for a confirmatory implementation study. TRIAL REGISTRATION: DRKS (Deutsches Register für klinische Studien) DRKS00017828 . Registered on 17th September 2019. Retrospectively registered.

High cost pool or high cost groups-How to handle high(est) cost cases in a risk adjustment mechanism?

Competitive social health insurance systems (at least) in Western Europe have implemented systems of morbidity based risk adjustment to set a level playing field for insurers. However, many high cost insured still are heavily underfunded despite risk adjustment, leaving incentives for risk selection. In most of these health care systems, there is an ongoing debate about how to deal with such underpaid high cost cases. This study develops four distinct concepts by adding variables to risk adjustment or by setting up a high cost pool for underpaid insured besides the risk adjustment system. Their features, incentives and distributional effects are discussed. With a data set of 6 million insured, performance is demonstrated for Germany. All models achieve a substantial improvement in model fit, measured in terms of R(2) as well as CPM. As the results of the various models are different in different dimensions, the trade-offs that have to be dealt with and should be addressed, when implementing a model to reduce underfunding of high cost cases.

Demand-side strategies to deal with moral hazard in public insurance for long-term care.

Moral hazard in public insurance for long-term care may be counteracted by strategies influencing supply or demand. Demand-side strategies may target the patient or the insurer. Various demand-side strategies and how they are implemented in four European countries (Germany, Belgium, Switzerland and the Netherlands) are described, highlighting the pros and cons of each strategy. Patient-oriented strategies to counteract moral hazard are used in all four countries but their impact on efficiency is unclear and crucially depends on their design. Strategies targeted at insurers are much less popular: Belgium and Switzerland have introduced elements of managed competition for some types of long-term care, as has the Netherlands in 2015. As only some elements of managed competition have been introduced, it is unclear whether it improves efficiency. Its effect will depend on the feasibility of setting appropriate financial incentives for insurers using risk equalization and the willingness of governments to provide insurers with instruments to manage long-term care.

Childhood psoriasis--an analysis of German health insurance data.

This study explored the epidemiology, treatment, and comorbidities of juvenile psoriasis in Germany using health insurance data. Psoriasis is a chronic inflammatory skin condition that affects approximately 2% to 3% of the world's population. Data were obtained from a database of approximately 6.7 million individuals registered with health insurance organizations throughout Germany. The analysis considered all individuals age 18 years and younger with psoriasis who were registered in 2007. Comorbidities were identified using software based on a morbidity-based risk adjustment model. A total of 138,338 patients with a diagnosis of psoriasis were identified in the database, yielding a prevalence of 2.1%. Within this group there were 4,499 children and adolescents (≤ 18 years of age), a prevalence of 0.4%. The prevalence ranged from 0.1% at the age of 1 year to 0.8% at the age of 18 years. Most of the patients were treated with topical corticosteroids (72.2%) and antipsoriatics (e.g., tars, psoralen; 20.0%). Immunosuppressants were used in 3.3% of the cases. Juvenile psoriasis was associated with numerous significant comorbidities such as rheumatoid arthritis and inflammation (2.1%); delirium, psychosis, and psychotic and dissociative disorder (1.1%); and heart disease (0.6%). Our study demonstrated that psoriasis is more prevalent in children and adolescents than some older international investigations have documented. Analysis of the health insurance data showed that juvenile psoriasis is associated with a range of comorbidities. The data also may suggest an unrecognized burden of mental health problems in young persons with psoriasis.

Cost-effectiveness analysis of coronary artery disease screening in HIV-infected men.

BACKGROUND: HIV-infected patients are at increased risk of coronary artery disease (CAD). We evaluated the cost-effectiveness of cardiac screening for HIV-positive men at intermediate or greater CAD risk. DESIGN: We developed a lifetime microsimulation model of CAD incidence and progression in HIV-infected men. METHODS: Input parameters were derived from two HIV cohort studies and the literature. We compared no CAD screening with stress testing and coronary computed tomography angiography (CCTA)-based strategies. Patients with test results indicating 3-vessel/left main CAD underwent invasive coronary angiography (ICA) and received coronary artery bypass graft surgery. In the stress testing + medication and CCTA + medication strategies, patients with 1-2-vessel CAD results received lifetime medical treatment without further diagnostics whereas in the stress testing + intervention and CCTA + intervention strategies, patients with these results underwent ICA and received percutaneous coronary intervention. RESULTS: Compared to no screening, the stress testing + medication, stress testing + intervention, CCTA + medication, and CCTA + intervention strategies resulted in 14, 11, 19, and 14 quality-adjusted life days per patient and incremental cost-effectiveness ratios of 49,261, 57,817, 34,887 and 56,518 Euros per quality-adjusted life year (QALY), respectively. Screening only at higher CAD risk thresholds was more cost-effective. Repeated screening was clinically beneficial compared to one-time screening, but only stress testing + medication every 5 years remained cost-effective. At a willingness-to-pay threshold of 83,000 €/QALY (∼ 100,000 US$/QALY), implementing any CAD screening was cost-effective with a probability of 75-95%. CONCLUSIONS: Screening HIV-positive men for CAD would be clinically beneficial and comes at a cost-effectiveness ratio comparable to other accepted interventions in HIV care.

Preconditions for efficiency and affordability in competitive healthcare markets: are they fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland?

CONTEXT: From the mid-1990s several countries have introduced elements of regulated competition in healthcare. The aim of this paper is to identify the most important preconditions for achieving efficiency and affordability under regulated competition in healthcare, and to indicate to what extent these preconditions are fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland. These experiences can be worthwhile for other countries (considering) implementing regulated competition (e.g. Australia, Czech Republic, Ireland, Russia, Slovakia, US). METHODS: We identify and discuss ten preconditions derived from the theoretical model of regulated competition and assess the extent to which each of these preconditions is fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland. FINDINGS: After more than a decade of healthcare reforms in none of these countries all preconditions are completely fulfilled. The following preconditions are least fulfilled: consumer information and transparency, contestable markets, freedom to contract and integrate, and competition regulation. The extent to which the preconditions are fulfilled differs substantially across the five countries. Despite substantial progress in the last years in improving the risk equalization systems, insurers are still confronted with substantial incentives for risk selection, in particular in Israel and Switzerland. Imperfect risk adjustment implies that governments are faced with a complex tradeoff between efficiency, affordability and selection. CONCLUSIONS: Implementing regulated competition in healthcare is complex, given the preconditions that have to be fulfilled. Moreover, since not all preconditions can be fulfilled simultaneously, tradeoffs have to be made with implications for the levels of efficiency and affordability that can be achieved. Therefore the optimal set of preconditions is not only an empirical question but ultimately also a matter of societal preferences.

The new risk adjustment formula in Germany: implementation and first experiences.

In Germany risk adjustment is a core element of the regulatory framework of competition between sickness funds. It shall create a level playing field between funds with very heterogeneous risk structures. Prior to 2009 risk adjustment was mainly by a demographic model. In 2009 morbidity based risk adjustment was introduced, embedded in a broader reform of the statutory health insurance system. The new formula covers 80 "severe" or "costly and chronic" diseases structured in a system of hierarchical groups. The performance of the new system was evaluated by the Advisory Board of Scientific Experts on Risk Adjustment to the Federal Insurance Office. The evaluation is based on the data of the first year 2009. Individual level as well as group level performance improved considerably comparing to the old model. Also predictive accuracy on the sickness funds level improved. The evaluation analyzed coding and prescription patterns in a joint point analyses. No changes of coding behavior which can be ascribed to the introduction of the new system were found. Some issues for further improvement were identified: A systematic underpayment for higher age groups is observed due to not annualizing the costs of the deceased. Systematic underpayment for multi-morbidity and systematic over-payment for those without any medical conditions can also be observed, although the level of over-/underpayment was clearly reduced compared to the old model.

Economic evaluation of treatment options in patients with Alzheimer's disease: a systematic review of cost-effectiveness analyses.

INTRODUCTION: Alzheimer's disease (AD) is common among the elderly; it is responsible for 60-80% of all dementia cases. AD is characterized by cognitive decline, behavioural and psychological symptoms, and reductions in functioning and independence. Because of its progressive neurodegenerative nature and unknown aetiology, the burden of AD becomes increasingly significant in an aging population. Estimates indicate that 35.6 million people worldwide suffered from AD in 2010. By 2030 and 2050, this figure is predicted to increase to 65.7 million and 115.4 million, respectively. Costs will also rise along with the increase in the number of people diagnosed with AD. In 2010, the worldwide costs associated with dementia were estimated to be $US604 billion. OBJECTIVE: The objective of this study was to conduct a systematic review of current publications dealing with the pharmacoeconomic factors associated with AD medications and to describe the decision-analytic models used to evaluate long-term outcomes. METHODS: A systematic literature search was performed to identify articles published between 1 January 2007 and 15 July 2010. The search was also based on a previous systematic review, which included literature up to 2007. Articles were included if they were complete and original economic evaluations of AD and if they were comparative in nature. A quality assessment of the included publications was conducted and relevant information was extracted into tables. RESULTS: Seven out of 2067 identified articles were included in this systematic review. Four articles evaluated treatment with donepezil, one with galantamine and two with memantine. The studies were conducted in America, Europe and Asia. Five different groups of medications were compared. The incremental cost-effectiveness ratios (ICERs) for the group of patients treated with donepezil versus no drug treatment ranged from a dominant value to 281, 416.13 euros per quality-adjusted life-year (QALY). Patients treated with donepezil versus placebo showed ICERs with a range from a dominant value (not specified) up to 20, 866.77 euros per QALY. Treatment with memantine in addition to donepezil versus treatment with donepezil alone showed an ICER range from a dominant value to 6818.33 euros per QALY. In comparison with the memantine treatment as an add-on therapy, the ICER of memantine monotherapy versus standard care (without cholinesterase inhibitors [CEIs]) ranged from a dominant value to 63, 087.20 euros per QALY. Finally, the economic evaluation of galantamine in comparison with usual care without any AD drugs showed ICERs ranging from 1894.70 euros to 6953 euros per QALY. CONCLUSION: The seven identified publications included in this review indicate that treatment with CEIs or memantine seems to be reasonable in terms of clinical effects and costs for patients with AD. Depending on different hypotheses, assumptions and variables (e.g. time horizon, discount rates, initial number of patients in different states, etc.) in the sensitivity analyses, treatment with these drugs seems to be primarily a cost-effective strategy or even a cost-saving strategy. Nevertheless, the results generally are associated with a degree of uncertainty. The comparability of the results from the different economic evaluations is limited because of the different assumptions made.

Risk adjustment and primary health care in Chile.

AIM: To offer a capitation formula with greater capacity for guiding resource spending on population with poorer health and lower socioeconomic status in the context of financing and equity in primary health care. METHODS: We collected two years of data on a sample of 10,000 individuals from a region in Chile, Valdivia and Temuco and evaluated three models to estimate utilization and expenditures per capita. The first model included age and sex; the second one included age, sex, and the presence of two key diagnoses; and the third model included age, sex, and the presence of seven key diagnoses. Regression results were evaluated by R2 and predictive ratios to select the best specifications. RESULTS: Per-capita expenditures by age and sex confirmed international trends, where children under five, women, and the elderly were the main users of primary health care services. Women sought health advice twice as much as men. Clear differences by socioeconomic status were observed for the indigent population aged > or =65 years who under-utilized primary health care services. From the three models, major improvement in the predictive power occurred from the demographic (adjusted R2, 9%) to the demographic plus two diagnoses model (adjusted R2, 27%). Improvements were modest when five other diagnoses were added (adjusted R2, 28%). CONCLUSION: The current formula that uses municipality's financial power and geographic location of health centers to adjust capitation payments provides little incentive to appropriate care for the indigent and people with chronic conditions. A capitation payment that adjusts for age, sex, and the presence of diabetes and hypertension will better guide resource allocation to those with poorer health and lower socioeconomic status.

Neonatal hearing screening: modelling cost and effectiveness of hospital- and community-based screening.

BACKGROUND: Children with congenital hearing impairment benefit from early detection and management of their hearing loss. These and related considerations led to the recommendation of universal newborn hearing screening. In 2001 the first phase of a national Newborn Hearing Screening Programme (NHSP) was implemented in England. Objective of this study was to assess costs and effectiveness for hospital and community-based newborn hearing screening systems in England based on data from this first phase with regard to the effects of alterations to parameter values. DESIGN: Clinical effectiveness analysis using a Markov Model. OUTCOME MEASURE: quality weighted detected child months (QCM). RESULTS: Both hospital and community programmes yielded 794 QCM at the age of 6 months with total costs of 3,690,000 pound sterling per 100,000 screened children in hospital and 3,340,000 pound sterling in community. Simulated costs would be lower in hospital in 48% of the trials. Any statistically significant difference between hospital and community in prevalence, test sensitivity, test specificity and costs would result in significant differences in cost-effectiveness between hospital and community. CONCLUSION: This modelling exercise informs decision makers by a quantitative projection of available data and the explicit and transparent statements about assumptions and the degree of uncertainty. Further evaluation of the cost-effectiveness should focus on the potential differences in test parameters and prevalence in these two settings.

Consumer price sensitivity and social health insurer choice in Germany and The Netherlands.

In this paper, we examine the effects of the introduction of free choice and price competition in social health insurance in Germany and the Netherlands. Using panel data at the sickness fund level we estimate the price elasticity of sickness fund choice in both countries. We find that the price elasticity in Germany is high and rapidly increasing. Consistent with findings of other studies on health plan choice, the price elasticity is much lower for elderly than for non-elderly. In the Netherlands, by contrast, the price elasticity of fund choice is negligible. Only when people were forced to choose a sickness fund, they were quite sensitive to premium differences. Key factors in explaining the observed differences in switching behavior between both countries are the degree of financial risk for sickness funds, the features of the risk-adjustment mechanism and the role of employers.

Free choice of sickness funds in regulated competition: evidence from Germany and The Netherlands.

Sickness funds became the focal point of health insurance reforms in the 1990s. Policy makers expected funds to become more consumer-oriented and more active in managing the provision of health care. This is especially true for two countries in the heart of Europe that, on first view, have many similar institutional characteristics. Both Germany and The Netherlands have introduced competition between sickness funds in the last decade. We present extensive quantitative, as well qualitative, data with regard to the behaviour of consumers after the introduction of free choice between sickness funds. National data was used with regard to contribution rates and member flows and survey data was used to investigate personal motives for actual change and perception of differences between sickness funds. In Germany, contribution rates between sickness funds differ significantly. Accordingly, these differences are the main reason for consumers to switch funds, which occurs on a considerable scale. However, survey data show that other reasons may be important too. In The Netherlands, premium differences are much lower. The same is true for the degree of change. Survey data show that consumers perceive very small differences between sickness funds and do not see much reason for change. Our findings support the claim that the degree of actual changing depends strongly on economic incentives, especially with regard to the extent of financial risk sickness funds have to bear and to the extent premiums or contribution rates can differ. However, the higher the financial risk of individual sickness funds actually is, the higher the incentives for risk selection.