Value and impact of international hospital accreditation: a case study from Jordan.

We assessed the economic impact of Joint Commission International hospital accreditation on 5 structural and outcome hospital performance measures in Jordan. We conducted a 4-year retrospective study comparing 2 private accredited acute general hospitals with matched non-accredited hospitals, using difference-in-differences and adjusted covariance analyses to test the impact and value of accreditation on hospital performance measures. Of the 5 selected measures, 3 showed statistically significant effects (all improvements) associated with accreditation: reduction in return to intensive care unit (ICU) within 24 hours of ICU discharge; reduction in staff turnover; and completeness of medical records. The net impact of accreditation was a 1.2 percentage point reduction in patients who returned to the ICU, 12.8% reduction in annual staff turnover and 20.0% improvement in the completeness of medical records. Pooling both hospitals over 3 years, these improvements translated into total savings of US$ 593 000 in Jordan's health-care system.

Mental health/substance abuse treatment in managed care: the Massachusetts Medicaid experience.

Massachusetts was the first state to introduce a statewide specialty mental health managed care plan for its Medicaid program. This study assesses the impact of this program on expenditures, access, and relative quality. Over a one-year period, expenditures were reduced by 22 percent below predicted levels without managed care, without any overall reduction in access or relative quality. Reduced lengths-of-stay, lower prices, and fewer inpatient admissions were the major factors. However, for one population segment--children and adolescents--readmission rates increased slightly, and providers for this group were less satisfied than they were before managed care was adopted. Less costly types of twenty-four-hour care were substituted for inpatient hospital care. This experience supports the usefulness of a managed care program for mental health and substance abuse services, and the applicability of such a program to high-risk populations.

Small-area variations in rates of hospitalization and surgery within Rhode Island.

We analyzed variations in the usage rates and costs of 13 surgical procedures among 37 cities and towns in the state of Rhode Island. To compare different operations and years, we defined the deviation index, a percentage indicator similar to the coefficient of variation, but with chance variation removed. Tonsillectomy and disc excision were the procedures for which rates varied most around the state average; their deviation indexes for 1981 were 40.5 percent and 38.9 percent, respectively. In 14 areas, rates for one of these two procedures (standardized for age and sex) were significantly (p less than .01) above or below the state average; such outlying observations would have been expected for only one area if rates had been uniform statewide. To indicate the relative amount of surgery in an area combining rates for all 13 procedures, we computed the area's surgical index. This index, the average of the ratios of observed to expected cases (based on standardized statewide rates), doubled from the lowest- to the highest-rate areas. Overall, surgical hospital days, nonsurgical days, total hospital days, and hospital costs (all per 1,000 population) doubled from lowest- to highest-rate areas. If the rates of these 13 surgical procedures could be lowered in high-rate areas to not more than 20 percent above the state average, usage could drop by 4 percent. We conclude that even within the small state of Rhode Island, surgical practice varies considerably across communities. Identifying and studying areas with extremely high or low rates should enable more explicit consideration of the indications for surgery and perhaps lead to lower costs for medical care.

Continuing care for cocaine dependence: comprehensive 2-year outcomes.

This report presents 2-year outcome data from an outpatient continuing care study in which cocaine-dependent patients (N = 132) were randomly assigned to either standard group counseling (STND) or individualized relapse prevention (RP). Data on cocaine outcomes during the 6-month treatment phase of the study were presented in an earlier report (J. R. McKay, A. I. Alterman, J. S. Cacciola, M. R. Rutherford, & C. P. O'Brien, 1997). In the present report, a continuing care condition main effect was obtained on only 1 of 8 outcome variables examined. However, patients who endorsed a goal of absolute abstinence on entering continuing care had better cocaine use outcomes in RP than in STND, whereas the opposite was the case for those with less stringent abstinence goals. In addition, patients with current cocaine or alcohol dependence on entering continuing care who received RP had better cocaine use outcomes in Months 1-6 and better alcohol use outcomes in Months 13-24 than those in STND.

Cost-effectiveness of substance abuse services. Implications for public policy.

Cost-effectiveness analysis, a technique for allocating resources, examines the relationship between the cost of providing treatment and resulting improvement in health measured in a single, numerical scale. In applying this concept to substance abuse services, the authors expressed effectiveness in terms of additional "abstinent years." To control for differences in clients across modalities, the authors used multivariate cost-effectiveness analysis, estimating results for a typical client at each of three alternative severity levels.

Estimating the effect of hospital closure on areawide inpatient hospital costs: a preliminary model and application.

A preliminary model is developed for estimating the extent of savings, if any, likely to result from discontinuing a specific inpatient service. By examining the sources of referral to the discontinued service, the model estimates potential demand and how cases will be redistributed among remaining hospitals. This redistribution determines average cost per day in hospitals that receive these cases, relative to average cost per day of the discontinued service. The outflow rate, which measures the proportion of cases not absorbed in other acute care hospitals, is estimated as 30 percent for the average discontinuation. The marginal cost ratio, which relates marginal costs of cases absorbed in surrounding hospitals to the average costs in those hospitals, is estimated as 87 percent in the base case. The model was applied to the discontinuation of all inpatient services in the 75-bed Chelsea Memorial Hospital, near Boston, Massachusetts, using 1976 data. As the precise value of key parameters is uncertain, sensitivity analysis was used to explore a range of values. The most likely result is a small increase ($120,000) in the area's annual inpatient hospital costs, because many patients are referred to more costly teaching hospitals. A similar situation may arise with other urban closures. For service discontinuations to generate savings, recipient hospitals must be low in costs, the outflow rate must be large, and the marginal cost ratio must be low.

Cost-effectiveness of the expanded programme on immunization in the Ivory Coast: a preliminary assessment.

A preliminary calculation was made of the cost-effectiveness of the measles component of the Expanded Programme on Immunization (EPI) in the Ivory Coast. The calculation is based on existing data (program budgets, coverage surveys, counts of vaccinations provided and subjective estimates) and applies to the first three demonstration and training zones (Abidjan, Abengourou and Korhogo) with a combined population of 1.75 million people. The average annual cost of the measles program (assumed to be 75% of all EPI costs, including supplies, personnel and equipment) in these three zones was $527,000 at 1980 prices. Having achieved an average coverage rate of 61%, the cost per vaccine was moderately high, $12. Yet, vaccinees are a sufficiently small part of the population that the cost per capita is only $0.30. The program is estimated to prevent 38,000 cases of measles and 1100 deaths per year in these three zones. Thus, the cost per measles case averted is $14, and the cost per death averted is $479. This means that the measles component of the EPI Program is highly effective in preventing deaths for the sums expended compared to many alternative health programs in developing countries.

The costs of crime and the benefits of substance abuse treatment for pregnant women.

Although many pregnant, drug-dependent women report extensive criminal justice involvement, few studies have examined reductions in crime as an outcome of substance abuse treatment programs for pregnant women. This is unfortunate, because maternal criminal involvement can have serious health and cost implications for the unborn child, the mother and society. Using the Addiction Severity Index, differences in pre- and posttreatment criminal involvement were measured for a sample of 439 pregnant women who entered publicly funded treatment programs in Massachusetts between 1992 and 1997. Accepted cost of illness methods were supplemented with information from the Bureau of Justice Statistics to estimate the costs and benefits of five treatment modalities: detoxification only (used as a minimal treatment comparison group), methadone only, residential only, outpatient only, and residential/outpatient combined. Projected to a year, the net benefits (avoided costs of crime net of treatment costs) ranged from US$32,772 for residential only to US$3,072 for detoxification. Although all five modalities paid for themselves by reducing criminal activities, multivariate regressions controlling for baseline differences between the groups showed that reductions in crime and related costs were significantly greater for women in the two residential programs. The study provides economic justification for the continuation and possible expansion of residential substance abuse treatment programs for criminally involved pregnant women.

Multivariate cost-effectiveness analysis: an application to optimizing ambulatory care for hypertension.

Cost-effectiveness analysis (CEA) is being used increasingly to allocate health resources efficiently. This paper develops an extension of CEA based on multivariate regression analysis and applies it to hypertension treatment. After assembling clinic and patient characteristics, outcomes, and costs for 2,439 randomly chosen patients in the 32 special hypertension clinics of the Department of Veterans Affairs (VA), we identified 19 significant predictors of cost and diastolic blood pressure (DBP) using multiple regression analysis. We classified these independent variables as "unambiguous" if a given change was associated with both lower cost and better DBP, or as "trade-off" variables if any change improving DBP entailed higher costs. The results suggest that fully implementing all unambiguous clinic changes would reduce costs by 33% while improving DBP. Multivariate CEA could help managed care companies and government programs with cost and outcome data to reduce costs and improve outcomes.

The impact of substance abuse treatment modality on birth weight and health care expenditures.

During the 1990s, substance abuse treatment programs were developed for pregnant women to help improve infant birth outcomes, reduce maternal drug dependency and promote positive lifestyle changes. This study compared the relative impact of five treatment modalities--residential, outpatient, residential/outpatient, methadone and detoxification-only--on infant birth weight and perinatal health care expenditures for a sample of 445 Medicaid-eligible pregnant women who received treatment in Massachusetts between 1992 and 1997. Costs and outcomes were measured using the Addiction Severity Index and data from birth certificates, substance abuse treatment records and Medicaid claims. Multiple regression was used to control for intake differences between the groups. Results showed a near linear relationship between birth weight and amount of treatment received. Women who received the most treatment (the residential/outpatient group) delivered infants who were 190 grams heavier than those who received the least treatment (the detoxification-only group) for an additional cost of $17,211. Outpatient programs were the most cost-effective option, increasing birth weight by 139 grams over detoxification-only for an investment of only $1,788 in additional health care and treatment costs. A second regression using five intermediate treatment outcomes--prenatal care, weight gain, relapse, tobacco use and infection--suggested that increases in birth weight were due primarily to improved nutrition and reduced drug use, behaviors which are perhaps more easily influenced in residential settings.

Cost-effectiveness model for prevention of early childhood caries.

This study presents and illustrates a model that determines the cost-effectiveness of three successively more complete levels of preventive intervention (minimal, intermediate, and comprehensive) in treating dental caries in disadvantaged children up to 6 years of age. Using existing data on the costs of early childhood caries (ECC), the authors estimated the probable cost-effectiveness of each of the three preventive intervention levels by comparing treatment costs to prevention costs as applied to a typical low-income California child for five years. They found that, in general, prevention becomes cost-saving if at least 59 percent of carious lesions receive restorative treatment. Assuming an average restoration cost of $112 per surface, the model predicts cost savings of $66 to $73 in preventing a one-surface, carious lesion. Thus, all three levels of preventive intervention should be relatively cost-effective. Comprehensive intervention would provide the greatest oral health benefit; however, because more children would receive reparative care, overall program costs would rise even as per-child treatment costs decline.

Cost-effectiveness of clinical interventions for AIDS wasting.

Economic studies of HIV/AIDS interventions are important for providing cost-effective care. This paper presents a costeffectiveness study of a three-arm clinical trial conducted at Tufts University School of Medicine/New England Medical Center in Boston, Massachusetts that treated 50 patients with AIDS wasting from March 1998 through January 2001. This study compared the costs and impacts of a nutritional counseling intervention alone (NC arm), the nutrition intervention with oxandrolone (OX arm), and the nutrition intervention with progressive resistance training (PRTarm) for the treatment of AIDS wasting. The cost of each intervention was derived for both the three-month clinical trial and a six-month estimated community model (ECM), its projected adaptation to community-based medical care. The cost determination involved obtaining and multiplying unit economic costs and quantities expended of each resource within each study arm. The ECM average cost per client in the cost-effectiveness analysis incorporated both institutional and societal perspectives. The costeffectiveness analysis compared the cost of each intervention to its quality-adjusted life-year (QALY) gain (Zeckhauser and Shepard, 1976). From a societal perspective, for the NC arm, the cost per client totaled US dollars 983 for the actual and US dollars 596 under the ECM. For the OX arm, the cost per client totaled US dollars 3,772 for the actual study and US dollars 3,385 under the ECM. For the PRT arm, the cost per client totaled US dollars 3,189 for the actual study and US dollars 2,987 under the ECM. Under the societal perspective the cost per QALY was US dollars 55,000 (range: US dollars 51,000 to US dollars 83,000) for the NC arm, US dollars 151,000 (range: US dollars 149,000 to US dollars 171,000) for the OX arm, and US dollars 65,000 (range: US dollars 44,000 to US dollars 104,000) for the PRTarm. When using only an institutional perspective, the cost per QALY was US dollars 45,000 (range: US dollars 42,000-US dollars 64,000) for the NC arm, US dollars 147,000 (range: US dollars 147,000 to US dollars 163,000) for the OX arm, and US dollars 31,000 (US dollars 21,000 to US dollars 44,000) for the PRTarm. This paper shows that cost and cost-effectiveness analyses can be adapted to a community setting by combining information from community practice and costs with data from a randomized trial. Compared to other AIDS treatments, such as highly active antiretroviral therapies, all three interventions were affordable, but their cost-effectiveness was intermediate. Oxandrolone was the least cost effective of the interventions, even compared to nutrition alone, as it included similar or somewhat greater costs for less of an increase in quality of life. PRT was the most cost-effective treatment for AIDS wasting, particularly from an institutional perspective. Third party payers should consider coverage of PRT.

Economic analysis of investment priorities for measles control.

An investment strategy in measles control should strike an appropriate balance among three areas: implementation of existing vaccination programs with existing technology, operations research to improve the use of existing technology, and vaccine development. As a benchmark, the existing Schwarz vaccine costs approximately $17 per DALY (disability-adjusted life year), already making it one of the most cost-effective health interventions in developing countries. National measles vaccination campaigns, such as Brazil's, are a promising extension of this technology. Operations research is indicated to study the organization of campaigns, supplying and delivering vitamin A to hospitalized children, and other issues. The development and application of an early one-dose measles vaccine would be particularly cost-effective ($5 per DALY), as it could avoid the costs to families and health institutions of the separate visit at 9 months now required for measles vaccination. All three areas present opportunities for cost-effective investments and deserve a place in an investment strategy.

Treatment of tuberculosis by private general practitioners in India.

Early detection and optimal treatment constitute the most important measures in the control of tuberculosis. This study of prescriptions for tuberculosis recommended by 102 private doctors, practising in the slums of Bombay, shows a lack of awareness among doctors who treat tuberculosis patients in their own clinics about the standard drug regimens for treatment of tuberculosis recommended by national and international agencies. While there are a few standard, efficient, recommended regimens, 100 private doctors prescribed 80 different regimens, most of which were both inappropriate and expensive. The study highlights the need for effective communication between those implementing national tuberculosis programmes and the practising private doctors, continuing education of these doctors for updating their knowledge and their active participation in at least those national disease programme for which their curative functions could contribute significantly to control of a disease.

Economic cost of malaria in Rwanda.

Although malaria is widely recognized as a major public health problem in much of Africa, its impact on a specific national or regional economy has proved difficult to assess. This paper demonstrates the kind of analysis possible given available national aggregate statistics on epidemiology and economic indicators, the type of data most readily available. An economic model which applies the average cost of malaria per case to the known number of cases in Rwanda for 1989 estimated the total cost to be $ 2.88 per capita (in 1987 US dollars). Of this cost, $0.63 per capita represents the direct cost of treatment, including care of outpatients and hospitalized cases in both government and private facilities, as well as self-treatment. The other $ 2.25 per capita represents the indirect costs of productive time lost to malaria morbidity in adults and to care for sick children, and the cost of lifetime earnings lost through premature malaria mortality. The average output per day of the Rwandan economy was $0.83 in 1989. Thus, the per capita malaria cost equals 3.5 days of production or 1% of GDP. The average cost of each of the 1,722,271 reported malaria cases in 1989 was $11.82: $2.58 in direct and $9.24 in indirect cost. The direct cost per case is equal to 160% of the per capita budget of the Ministry of Health. Economic and epidemiological projections to 1995 yield an increase in malaria cases to over 4 million at a cost of $7.11 per capita. Direct costs are projected to rise over 200% due to increasing costs of drugs and supplies to treat increasingly drug-resistant cases. Indirect costs, which are tied to a declining economy, are projected to rise by just over 100%. By 1995, malaria is projected to cost 2.4% of the Rwandan GDP, exacerbating an already serious impact.

Productivity loss due to deformity from leprosy in India.

The productivity loss in India due to deformity from leprosy was assessed in a random sample of 550 leprosy patients from a rural and an urban area in the state of Tamil Nadu. Logistic and log-linear regression analyses on these leprosy patients showed that elimination of deformity would: a) raise the probability of gainful employment from 42.2% to 77.6%; b) increase annual earnings per patient gainfully employed from Rs 2948 to Rs 6469; and c) raise overall earnings for all patients from Rs 1259 to Rs 5023 per year. The earnings of 550 control subjects (adult family members of the leprosy patients) were consistent with these predictions. Extrapolation to all of India's estimated 645,000 leprosy patients with deformity suggests that elimination of deformity would raise productivity by +130 million per year. The authors conclude that the development and evaluation of programs to eliminate deformity from leprosy deserve high priority.