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 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.

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.

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.

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.

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 role of private providers in treating child diarrhoea in Latin America.

Diarrhoeal disease, a leading cause of child mortality, disproportionately affects children in low-income countries - where private and non-governmental providers are often an important source of health care. We use 10 Living Standards Measurement Surveys from Latin America to model the choice of care for child diarrhoea in the private sector compared to the public sector. A total of 36.8% of children in the combined data set saw a private provider rather than a public one when taken for treatment. Each additional quintile of household economic status is associated with an increase of 6.5 percentage points in the probability that a child with diarrhoea is taken to a private provider (p<0.001). However, treatments provided in the private sector are manifestly of worse quality than in the public sector. A total of 33.0% of children visiting a public provider received Oral Rehydration Solution, compared to 13.7% of those visiting a private provider. Conversely, children treated by a private provider are more likely to receive drugs, most commonly unnecessary antibiotics. Ironically, when it comes to treatment for child diarrhoea, wealthier and better educated households in Latin America are paying for treatment in the private sector that is ineffective in comparison with treatments that are commonly and inexpensively available.

The cost-effectiveness of a child nutrition education programme in Peru.

This article reports impact and cost results from a health facility-based nutrition education programme targeting children less than 2 years of age in Trujillo, Peru. Key elements of the programme included participative complementary feeding demonstrations, growth monitoring sessions and an accreditation process. Data were collected from six intervention and six control health facilities to measure utilization and costs associated with the intervention. To calculate the unit costs of services, these costs are allocated using activity-based costing. To measure the effects of the intervention, 338 children were followed through household surveys at regular intervals from birth until the age of 18 months. The intervention had a clear positive impact both on the use of nutrition-related services and on children's growth outcomes. Children in the intervention areas made 17.6 visits to health facilities in the first 18 months of life, compared with 14.1 visits for children in the control areas (P < 0.001). This pattern holds true for all socioeconomic groups. The intervention prevented 11.1 cases of stunting per 100 children. In multivariate logistic regression analysis, children in the intervention were 0.33 times as likely to be stunted as the controls (P = 0.002). The marginal cost of the intervention - including external costs, training, health education materials and extra travel and equipment - is 6.12 US dollars per child reached and 55.16 US dollars per case of stunting prevented. The estimated marginal cost of the intervention per death averted is 1952 US dollars.

Determinants of child morbidity in Latin America: a pooled analysis of interactions between parental education and economic status.

Diarrhea and respiratory infections account for more than two-fifths of all deaths among children under five. Parental education and economic status are well-known risk factors for child morbidity, but little is known about whether education and economic status operate synergistically or independently to influence children's health. Confirming the presence and direction of such interactions is important to better target education and development policies. Our objective is to test for interactions between parental education and economic status in predicting the risk of diarrhea and respiratory illness among children under five, before and after adjusting for key proximate risk factors. We pool 12 Demographic and Health Surveys (DHS) and nine Living Standards Measurement Surveys (LSMS) from Latin America, creating two large databases. Quintiles of economic status are constructed from principal components asset indices. We use logistic regression to analyze episodes of diarrhea and respiratory illness, and interactions between economic quintile and maternal and paternal education are evaluated via likelihood ratio tests. We find that mother's education and quintile interact synergistically in the DHS data, while results are inconclusive in the LSMS data. The effect of increasing maternal education appears to be more protective for children in wealthy families than for children in poor families. Conversely, improvements in economic status reduce health risks more for children whose mothers are better educated. Father's education is protective and operates independently of economic status. Our findings imply that poverty alleviation efforts occurring in concert with programs to educate women and girls will be more effective for improving children's health than either approach alone.

Health spending in the United States and the rest of the industrialized world.

U.S. citizens spent $5,267 per capita for health care in 2002--53 percent more than any other country. Two possible reasons for the differential are supply constraints that create waiting lists in other countries and the level of malpractice litigation and defensive medicine in the United States. Services that typically have queues in other countries account for only 3 percent of U.S. health spending. The cost of defending U.S. malpractice claims is estimated at $6.5 billion in 2001, only 0.46 percent of total health spending. The two most important reasons for higher U.S. spending appear to be higher incomes and higher medical care prices.

Pricing health services for purchasers--a review of methods and experiences.

This article reviews methodologies and international experience related to costing and pricing health services for health care purchasers. The main factors affecting price-setting methods are: (1) provider payment systems; (2) information available on actual costs, service volumes and outcomes; and (3) characteristics of providers and purchasers. These factors are strongly interrelated. Provider payment systems determine the unit of services to be priced. In order to minimize incentives for under- or over-utilization, the prices that purchasers pay for health care services should be related to the actual unit costs of services, but accurately calculating real unit costs is intensive in terms of resources and information. Pertinent provider characteristics influencing price-setting include provider autonomy, provider negotiating power, and the degree of competition. The article presents a series of examples that run through each of these three sets of factors. The examples are from Denmark, the UK, and Thailand (for capitation); Australia, Hungary, and the United States (for case-based payment); and Germany, Korea, and Taiwan (for fee-for-service payment mechanisms). From these experiences, the article concludes with appropriate lessons for low- and middle-income countries, where the principal constraint on the development of provider payments systems is the limited availability of information on costs, volumes, and patient characteristics.

Measuring financial protection in health in the United States.

One rationale for health insurance coverage is to provide financial protection against catastrophic health expenditures. This article defines a lack of financial protection as household spending on health care when: (1) out-of-pocket (OOP) health expenditures exceed 10% of family income; (2) out-of-pocket expenditures exceed an absolute level of 2000 US dollars per family member on an annual basis; and (3) combined out-of-pocket and prepaid health expenditures exceed 40% of family income. The article explores how the likelihood of households in the United States surpassing these thresholds varies by income level, extent of insurance coverage, and the number of chronic conditions. The results show clearly that there is a lack of financial protection for health services for a wide segment of the US population-particularly so for poor families and those with multiple chronic conditions. The results are placed in an international context. Similar studies in other countries would allow for more in-depth comparisons of financial protection than are currently possible.

Quality-based purchasing in health care.

Quality-based purchasing is a growing trend that seeks to improve healthcare quality through the purchaser-provider relationship. This article provides a unifying conceptual framework, presents examples of the purchaser-provider relationship in countries at different income levels, and identifies important supporting mechanisms for quality-based purchasing. As countries become wealthier, a higher proportion of healthcare spending is channeled through pooled arrangements, allowing for greater involvement of purchasers in promoting the quality of service provision. Global and line item budgets are the most common type of provider payment system in low and middle-income countries. In these countries, improving public hospital performance through contracting and incentives is a key issue. In middle and high-income countries, there are several documented examples of governments contracting to private or non-governmental health care providers, resulting in higher perceived quality of care and lower delivery costs. Encouraging quality through employer purchasing arrangements has been promoted in several countries, particularly the United States. Community-based financing schemes are an increasingly common form of health financing in parts of sub-Saharan Africa and Asia, but these schemes still cover less than 10% of national populations in countries in which they are active. To date, there is little evidence of their impact on healthcare quality. The availability of information--concerning healthcare service provision and outcomes--determines the options for establishing and monitoring contract provisions and promoting quality. Regardless of the context, quality-based purchasing depends critically on informa-tion--reporting, monitoring, and providing useful information to healthcare consumers. In many low and middle-income countries, the lack of availability of information is the principal constraint on measuring performance, a critical component of quality-based purchasing.

Coverage and costs of childhood immunizations in Cameroon.

OBJECTIVE: To quantify the association between household-level and provider-level determinants and childhood immunization rates in Cameroon while also calculating the cost of childhood immunizations. METHODS: This study uses multilevel regression analysis to calculate these relationships. The 1998 Cameroon Demographic and Health Survey and the 2000 Multiple Indicator Cluster Survey are the main sources of household-level data. These surveys are supplemented by data from a 2002 survey of health facilities conducted in three provinces. At the national level, immunization financing data were collected from the Ministry of Health and donors that support the national Expanded Programme on Immunization. FINDINGS: The 1998 survey found that nationally 37% of children were fully immunized; the 2000 survey found that nationally 34% were fully immunized. These results are strongly correlated with both the mother's level of education and the household's economic status. Multilevel logistic regression shows that maternal education level is a stronger predictor of positive immunization status than is relative economic status. Children of mothers with secondary education or higher education were 3 times more likely to be fully vaccinated than children whose mothers had not completed primary education. At the health-facility level, both having art immunization plan and regular supervisory visits from someone at the health-district level are strongly positively associated with immunization rates. The cost of routine vaccinations for each fully immunized child is 12.73 U.S. dollars when donors' contributions are included but not the costs of immunization campaigns. CONCLUSION: Studies conducted in the 1980s and 1990s found that costs per fully immunized child varied from 2.19 U.S. dollars to 26.59 U.S. dollars (not adjusted for inflation) in a range of low-income and middle-income countries. The relatively low rates of immunization coverage in Cameroon, and the strong influence of the household's socioeconomic status--particularly the mother's level of education--on immunization rates suggest that the effectiveness of the Cameroon programme could be increased by promoting immunization and directing such programmes towards households with limited resources.