Hospitalization costs for COVID-19 in Ethiopia: Empirical data and analysis from Addis Ababa's largest dedicated treatment center.

BACKGROUND: The COVID-19 pandemic has caused profound health, economic, and social disruptions globally. We assessed the full costs of hospitalization for COVID-19 disease at Ekka Kotebe COVID-19 treatment center in Addis Ababa, the largest hospital dedicated to COVID-19 patient care in Ethiopia. METHODS AND FINDINGS: We retrospectively collected and analysed clinical and cost data on patients admitted to Ekka Kotebe with laboratory-confirmed COVID-19 infections. Cost data included personnel time and salaries, drugs, medical supplies and equipment, facility utilities, and capital costs. Facility medical records were reviewed to assess the average duration of stay by disease severity (either moderate, severe, or critical). The data collected covered the time-period March-November 2020. We then estimated the cost per treated COVID-19 episode, stratified by disease severity, from the perspective of the provider. Over the study period there were 2,543 COVID-19 cases treated at Ekka Kotebe, of which, 235 were critical, 515 were severe, and 1,841 were moderate. The mean patient duration of stay varied from 9.2 days (95% CI: 7.6-10.9; for moderate cases) to 19.2 days (17.9-20.6; for critical cases). The mean cost per treated episode was USD 1,473 (95% CI: 1,197-1,750), but cost varied by disease severity: the mean cost for moderate, severe, and critical cases were USD 1,266 (998-1,534), USD 1,545 (1,413-1,677), and USD 2,637 (1,788-3,486), respectively. CONCLUSIONS: Clinical management and treatment of COVID-19 patients poses an enormous economic burden to the Ethiopian health system. Such estimates of COVID-19 treatment costs inform financial implications for resource-constrained health systems and reinforce the urgency of implementing effective infection prevention and control policies, including the rapid rollout of COVID-19 vaccines, in low-income countries like Ethiopia.

Capital Expenditures Increased at Rural Hospitals That Merged Between 2012 and 2015.

EXECUTIVE SUMMARY: The number of rural hospital mergers has increased substantially in recent years. A commonly reported reason for merging is to increase access to capital. However, no empirical evidence exists to show whether capital expenditures increased at rural hospitals after a merger. We used a difference-in-differences approach to determine whether total capital expenditures changed at rural hospitals after a merger. The comparison group (rural hospitals that did not merge during the 2012 through 2015 study period) was weighted using inverse probability of treatment weights. The key outcome measure was logged total capital expenditures.Merging resulted in a 26% increase in capital expenditures and also was associated with a significant improvement in plant age. The postmerger improvement in plant age may have been partially attributable to merger-related accounting changes and partially attributable to increased capital expenses, possibly on long-term asset renovations and replacement.These findings suggest that through mergers, rural hospital board members and executives who have accepted or are considering a merger may improve a hospital's ability to increase capital expenditures. Further, increased capital investments in rural hospitals may be an important signal to the community that the acquirer intends to keep the rural hospital open and continue providing some volume and level of services within the community. Future research should determine how capital is spent after a merger.

The cost of a school based mass treatment of schistosomiasis in Ugu District, KwaZulu Natal, South Africa in 2012.

INTRODUCTION: The Neglected Tropical Diseases Roadmap of the WHO set targets for potential elimination as a "public health problem" for the period 2012-2020 in multiple countries in Africa, with the aim of global elimination of schistosomiasis as a "public health problem" by 2025. AIM: The purpose of the study was to estimate the cost from a provider's perspective of the Department of Health's Schistosomiasis Mass Drug Administration (MDA) in Ugu District, KwaZulu-Natal in 2012, with a view to project the costs for the entire KwaZulu Natal Province. METHODS: A total of 491 public schools and 16 independent schools in Ugu District, a predominantly rural district in KwaZulu-Natal with a total of 218 242 learners, were included in the schistosomiasis control programme. They were randomly selected from schools situated below an altitude of 300 meters, where schistosomiasis is endemic. A retrospective costing study was conducted using the provider's perspective to cost. Cost data were collected by reviewing existing records including financial statements, invoices, receipts, transport log books, equipment inventories, and information from personnel payroll, existing budget, and the staff diaries. RESULTS: A total of 15571 children were treated in 2012, resulting in a total cost of the MDA programme of ZAR 2 137 143 and a unit cost of ZAR 137. The three main cost components were Medication Costs (37%), Human Resources Cost (36%) and Capital items (16%). The total cost for treating all eligible pupils in KwaZulu-Natal will be ZAR 149 031 888. However, should the capital cost be excluded, then the unit cost will be ZAR 112 per patient and this will translate to a total cost of ZAR 121 836 288. CONCLUSIONS: Low coverage exacerbates the cost of the programme and makes a decision to support such a programme difficult. However, a normative costing study based on the integration of the programme within the Department of Health should be conducted.

Profitability of Large Pharmaceutical Companies Compared With Other Large Public Companies.

Importance: Understanding the profitability of pharmaceutical companies is essential to formulating evidence-based policies to reduce drug costs while maintaining the industry's ability to innovate and provide essential medicines. Objective: To compare the profitability of large pharmaceutical companies with other large companies. Design, Setting, and Participants: This cross-sectional study compared the annual profits of 35 large pharmaceutical companies with 357 companies in the S&P 500 Index from 2000 to 2018 using information from annual financial reports. A statistically significant differential profit margin favoring pharmaceutical companies was evidence of greater profitability. Exposures: Large pharmaceutical vs nonpharmaceutical companies. Main Outcomes and Measures: The main outcomes were revenue and 3 measures of annual profit: gross profit (revenue minus the cost of goods sold); earnings before interest, taxes, depreciation, and amortization (EBITDA; pretax profit from core business activities); and net income, also referred to as earnings (difference between all revenues and expenses). Profit measures are described as cumulative for all companies from 2000 to 2018 or annual profit as a fraction of revenue (margin). Results: From 2000 to 2018, 35 large pharmaceutical companies reported cumulative revenue of $11.5 trillion, gross profit of $8.6 trillion, EBITDA of $3.7 trillion, and net income of $1.9 trillion, while 357 S&P 500 companies reported cumulative revenue of $130.5 trillion, gross profit of $42.1 trillion, EBITDA of $22.8 trillion, and net income of $9.4 trillion. In bivariable regression models, the median annual profit margins of pharmaceutical companies were significantly greater than those of S&P 500 companies (gross profit margin: 76.5% vs 37.4%; difference, 39.1% [95% CI, 32.5%-45.7%]; P < .001; EBITDA margin: 29.4% vs 19%; difference, 10.4% [95% CI, 7.1%-13.7%]; P < .001; net income margin: 13.8% vs 7.7%; difference, 6.1% [95% CI, 2.5%-9.7%]; P < .001). The differences were smaller in regression models controlling for company size and year and when considering only companies reporting research and development expense (gross profit margin: difference, 30.5% [95% CI, 20.9%-40.1%]; P < .001; EBITDA margin: difference, 9.2% [95% CI, 5.2%-13.2%]; P < .001; net income margin: difference, 3.6% [95% CI, 0.011%-7.2%]; P = .05). Conclusions and Relevance: From 2000 to 2018, the profitability of large pharmaceutical companies was significantly greater than other large, public companies, but the difference was less pronounced when considering company size, year, or research and development expense. Data on the profitability of large pharmaceutical companies may be relevant to formulating evidence-based policies to make medicines more affordable.

Taxes, bankruptcy costs, and capital structure in for-profit and not-for-profit hospitals.

About 60% of the US hospitals are not-for-profit and it is not clear how traditional theories of capital structure should be adapted to understand the borrowing behavior of not-for-profit hospitals. This paper identifies important determinants of capital structure taken from theories describing for-profit firms as well as prior literature on not-for-profit hospitals. We examine the differential effects these factors have on the capital structure of for-profit and not-for-profit hospitals. Specifically, we use a difference-in-differences regression framework to study how differences in leverage between for-profit and not-for-profit hospitals change in response to key explanatory variables (i.e. tax rates and bankruptcy costs). The sample in this study includes most US short-term general acute hospitals from 2000 to 2012. We find that personal and corporate income taxes and bankruptcy costs have significant and distinct effects on the capital structure of for-profit and not-for-profit hospitals. Specifically, relative to not-for-profit hospitals: (1) higher corporate income tax encourages for-profit hospitals to increase their debt usage; (2) higher personal income tax discourages for-profit hospitals to use debt; and (3) higher expected bankruptcy costs lead for-profit hospitals to use less debt. Over the past decade, the capital structure of for-profit hospitals has been more flexible as compared to that of not-for-profit hospitals. This may suggest that not-for-profit hospitals are more constrained by external financing resources. Particularly, our analysis suggests that not-for-profit hospitals operating in states with high corporate taxes but low personal income taxes may face particular challenges of borrowing funds relative to their for-profit competitors.

Accounting Basics Part 3: Time Value and Internal Rate of Return.

Understanding the principles behind the time value of money can help individuals succeed in both business and personal long-term planning. The Internal Rate of Return (IRR) method provides a straightforward way to analyze long-term financial decisions. The result, the project's IRR, is a simple percentage that is easy to explain and compare with the results from other projects. When considering multiple investments, it is relatively simple to rank them by their IRRs, make minor adjustments to the list for qualitative issues, and invest down the list until the funds for the year have been spent.

MRI Upgrade: A Case Study in Germany.

The purpose of this work was a cost analysis for the acquisition of two new MRI devices in a university hospital. The costs of a classical exchange (new purchase) were compared to those of a system upgrade. Taking the local circumstances into account, up to $121,000 could be saved with. the system upgrade for one MRI system compared to a classic exchange. Upgrades of the 1.5 and 3 Tesla systems were performed within 15 working days without any problems or restrictions. The number of examinations per day could be increased from 13.4 to 16.2 using the 1.5T system and from 14.1 to 15.9 using the 3T. The upgrade possibility of an old MRI device represents an economically attractive approach, which allows access to the latest state-of-the-art MRI technology while respecting the limited economic resources of the department.

Accounting Basics Part 4: Net Present Value.

MaKing and justitying capital expenditures can be a difficult part of a supervi- sory or managerial position. Understanding more advanced accounting tools for justifying these expenditures, like Internal Rate of Return (IRR) and Net Present Value (NPV), can improve the chances of receiving necessary funding. NPV avoids the weaknesses of the IRR method by allowing decision makers to specify when cash flows will occur instead of assuming that net cash flows will be equal each year ofa project. Taking the time to learn basic account- ing definitions and tools can improve your ability to manage and provide greater opportunities to help patients, staff, and the community.

Skilled Nursing Center Data In For 2016.

Taking stock of the market's current and recent trends can help owners assess their business strategies.

Beyond the EHR money pit: After investing big in health records, systems still face growing IT needs for upgrades, analytics and patient engagement.

Demands for constant upgrades to already-installed electronic health record systems are slowing investment in other important digital technologies like telehealth, remote patient monitoring and online billing.

Inadequate physical activity and health care expenditures in the United States.

This study estimates the percentage of health care expenditures in the non-institutionalized United States (U.S.) adult population associated with levels of physical activity inadequate to meet current guidelines. Leisure-time physical activity data from the National Health Interview Survey (2004-2010) were merged with health care expenditure data from the Medical Expenditure Panel Survey (2006-2011). Health care expenditures for inactive (i.e., no physical activity) and insufficiently active adults (i.e., some physical activity but not enough to meet guidelines) were compared with active adults (i.e., ≥150minutes/week moderate-intensity equivalent activity) using an econometric model. Overall, 11.1% (95% CI: 7.3, 14.9) of aggregate health care expenditures were associated with inadequate physical activity (i.e., inactive and insufficiently active levels). When adults with any reported difficulty walking due to a health problem were excluded, 8.7% (95% CI: 5.2, 12.3) of aggregate health care expenditures were associated with inadequate physical activity. Increasing adults' physical activity to meet guidelines may reduce U.S. health care expenditures.

Dollars for lives: the effect of highway capital investments on traffic fatalities.

INTRODUCTION: This study examines the effect of highway capital investments on highway fatalities. METHODS: We used state-level data from the 48 contiguous states in the United States from 1968 through 2010 to estimate the effects on highway fatalities of capital expenditures and highway capital stock. We estimated these effects by controlling for a set of control variables together with state and year dummy variables and state-specific linear time trends. RESULTS: We found that capital expenditures and capital stock had significant and negative effects on highway fatalities. CONCLUSION: States faced with declines in gas tax revenues have already cut back drastically on spending on roads including on maintenance and capital outlay. If this trend continues, it may undermine traffic safety. PRACTICAL APPLICATION: While states and local governments are currently fiscally strained, it is important for them to continue investments in roadways to enhance traffic safety and, more significantly, to save lives.

The national employment guarantee scheme and inequities in household spending on food and non-food determinants of health in rural India.

INTRODUCTION: Inequities in a population in spending on food and non-food items can contribute to disparities in health status. The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was launched in rural India in 2006, aimed at providing at least 100 days of manual work to a member in needy households. METHODS: We used nationally representative data from the consumer expenditure surveys of 2004-05 and 2009-10 and the employment survey of 2009-10 conducted by National Sample Survey Organisation to assess the effect of MGNREGS in reducing inequities in consumption of food and non-food items between poor and non-poor households in the states of India. Variations among the states in implementation of MGNREGS were examined using the employment and unemployment survey data, and compared with official programme data up to 2012-13. Inequity in spending on food and non-food items was assessed using the ratio of monthly per capita consumer expenditure (MPCE) between the most vulnerable (labourer) and least vulnerable categories of households. RESULTS: The survey data suggested 1.42 billion person-days of MGNRGES employment in the 2009-10 financial year, whereas the official programme data reported 2.84 billion person-days. According to the official data, the person-days of MGNRGES employment decreased by 43.3% from 2009-10 to 2012-13 for the 9 large less developed states of India. Survey data revealed that the average number of MGNREGS work days in a year per household varied from 42 days in Rajasthan to less than 10 days in 14 of the 20 major states in India in 2009-10. Rajasthan with the highest implementation of MGNRGES among the 9 less developed states of India had the highest relative decline of 10.4% in the food spending inequity from 2004-05 to 2009-10 between the most vulnerable and less vulnerable households. The changes in inequity for non-food spending did not have any particular pattern across the less developed states. In the most vulnerable category, the households in Rajasthan that got 100 or more days of work in a year under MGNREGS had a 25.9% increase in MPCE. CONCLUSION: MGNREGS seems to have contributed to the reduction in food consumption inequity in rural Rajasthan in 2009-10, and has the potential of making a similar contribution with higher level of implementation of this programme in other states. Non-food consumption inequities benefited less from MGNRGES until 2009-10. The reported decrease in the MGNRGES employment person-days in the less developed states of India from 2009-10 to 2012-13 is of concern.

Assessing the validity of self-reported community benefit expenditures: evidence from not-for-profit hospitals in California.

CONTEXT: In its revised Form 990 Schedule H, the Internal Revenue Service requires not-for-profit hospitals to provide detailed financial information on their community benefits, yet no standardized reporting guidelines exist for how these activities should be quantified. As a result, little is known currently about whether a hospital's self-reported community benefit expenditures provide an accurate picture of its commitment to serving the community. OBJECTIVE: To assess the validity of hospitals' self-reported community benefit expenditures. DATA AND METHODS: Data for this study came from California hospitals. Self-reported community benefit expenditures were derived from hospitals' annual community benefit reports for the year 2009. Bivariate correlation analysis was used to compare self-reported expenditures to a set of indicators of hospitals' charitable activity. Of the 218 private, not-for-profit California hospitals that were required to submit community benefit reports for 2009, 91 (42%) provided sufficient information for our analysis. RESULTS: California hospitals' self-reported community benefit expenditures were strongly correlated with indicators of charitable activity. Hospitals that reported higher community benefit expenditures engaged in more charitable activities than hospitals that reported lower levels of community benefit spending. CONCLUSION: Expenditure information from California hospitals' community benefit reports was found to be a valid indicator of charitable activity. Self-reported community benefit spending may thus provide a fairly accurate picture of a hospital's commitment to serving its community, despite the lack of standardized reporting guidelines.

A cost study of postoperative cell salvage in the setting of elective primary hip and knee arthroplasty.

BACKGROUND: The increasing costs, limited supply, and clinical risks associated with allogeneic blood transfusion have prompted investigation into autologous blood management strategies, such as postoperative red blood cell (RBC) salvage. This study provides a cost comparison of transfusing washed postoperatively salvaged RBCs using an orthopedic perioperative autotransfusion device (OrthoPat, Haemonetics Corporation) versus unwashed shed blood and banked allogeneic blood. STUDY DESIGN AND METHODS: Cell salvage data were retrospectively reviewed for a sample of 392 patients who underwent primary hip or knee arthroplasty. Mean unit costs were calculated for washed salvaged RBCs, equivalent units of unwashed shed blood, and therapeutically equivalent volumes of allogeneic RBCs. RESULTS: No initial capital investment was required for the establishment of the postoperative cell salvage program. For patients undergoing total knee arthroplasty (TKA), the mean unit costs for washed postoperatively salvaged cells, unwashed shed blood, and allogeneic banked blood were $758.80, $474.95, and $765.49, respectively. In patients undergoing total hip arthroplasty (THA), the mean unit costs for washed postoperatively salvaged cells, unwashed shed blood, and allogeneic banked blood were $1827.41, $1167.41, and $2609.44, respectively. CONCLUSION: This analysis suggests that transfusing washed postoperatively salvaged cells using the OrthoPat device is more costly than using unwashed shed blood in both THA and TKA. When compared to allogeneic transfusion, washed postoperatively salvaged cells carry a comparable cost in TKA, but potentially represent a significant savings in patients undergoing THA. Sensitivity analysis suggests that in the case of TKA, however, cost comparability exists within a narrow range of units collected and infused.

Two-tier charging in Maputo Central Hospital: costs, revenues and effects on equity of access to hospital services.

BACKGROUND: Special services within public hospitals are becoming increasingly common in low and middle income countries with the stated objective of providing higher comfort services to affluent customers and generating resources for under funded hospitals. In the present study expenditures, outputs and costs are analysed for the Maputo Central Hospital and its Special Clinic with the objective of identifying net resource flows between a system operating two-tier charging, and, ultimately, understanding whether public hospitals can somehow benefit from running Special Clinic operations. METHODS: A combination of step-down and bottom-up costing strategies were used to calculate recurrent as well as capital expenses, apportion them to identified cost centres and link costs to selected output measures. RESULTS: The results show that cost differences between main hospital and clinic are marked and significant, with the Special Clinic's cost per patient and cost per outpatient visit respectively over four times and over thirteen times their equivalent in the main hospital. DISCUSSION: While the main hospital cost structure appeared in line with those from similar studies, salary expenditures were found to drive costs in the Special Clinic (73% of total), where capital and drug costs were surprisingly low (2 and 4% respectively). We attributed low capital and drug costs to underestimation by our study owing to difficulties in attributing the use of shared resources and to the Special Clinic's outsourcing policy. The large staff expenditure would be explained by higher physician time commitment, economic rents and subsidies to hospital staff. On the whole it was observed that: (a) the flow of capital and human resources was not fully captured by the financial systems in place and stayed largely unaccounted for; (b) because of the little consideration given to capital costs, the main hospital is more likely to be subsidising its Special Clinic operations, rather than the other way around. CONCLUSION: We conclude that the observed lack of transparency may create scope for an inequitable cross subsidy of private customers by public resources.

Association of market, organizational and financial factors with the number, and types of capital expenditures.

BACKGROUND: Prior literature provides only a descriptive view of the types and numbers of capital expenditures made by hospitals. PURPOSES: This study conducted an empirical analysis to assess simultaneously what market, organizational, and financial factors relate to the number of capital projects as well as the specific types: medical equipment, expansion, and maintenance projects. METHODOLOGY/APPROACH: Sampling California hospital capital expenditure data from 2002 to 2007, this study aggregated the number of capital projects by each type of capital investment decision: medical equipment, expansion, and maintenance/renovation per hospital. Using ordinary least squares regression, this study evaluated the association of these factors with these types of capital investment projects. FINDINGS: This study found that hospitals capturing a greater share of the market, maintaining high levels of liquidity, and operating with more than 350 beds invested in a greater number of capital projects per hospital as well as medical equipment and expansionary projects per hospital. PRACTICAL IMPLICATIONS: Within the state of California, the demand for health care services within a hospital market as well as cash and investment reserves were key drivers in the hospital CEOs and boards' decision to increase their capital purchases. The types of purchases included capital outlays related to medical equipment, such as CT scanners, MRIs, and surgical systems, and revenue-generating expansionary projects, such as new bed towers, hospitals wings, operating and emergency rooms, and replacement hospitals from 2002 to 2007.

The capital cost and productivity of MRI in a Belgian setting.

Against the Belgian background of national planning of MRI units and a detailed reimbursement scheme, a study was undertaken to investigate the cost and productivity of MRI units in different investment scenarios and for various operational schedules. This article focuses on capital costs, not operating cost. Using data from a hospital survey and manufacturers, total capital costs per examination were simulated. The survey revealed considerable variation in operational hours, with on average 66 hours per week, resulting in 6 300 examinations per year per unit. Whilst operational hours remained approximately unchanged over the last 8 years, the number of examinations per unit grew by on average 6% per year. Correspondingly, average examination time declined from 45 to 31 minutes. The findings suggest that, mainly due to the increased productivity, capital costs per examination decreased considerably in the examined period. In 2008, the average capital cost per examination is estimated to vary from 23 Euros to 45 Euros for 1.5 Tesla units and from 32 Euros to 62 Euros for 3 Tesla units, assuming an equal examination speed for both types of units.