Global and Episodic Bundling: An Overview and Considerations for Medicaid

Examines implementation issues for two payment strategies under which a group of providers receives a single payment per patient for a predefined time period for a predefined set of services and which involve risk adjustment and quality measurement

Counting Change: Measuring Health Care Prices, Costs, and Spending

Considers the accuracy and utility of current data on the determinants of healthcare costs, distorting factors that make measuring the costs of healthcare delivery difficult, the benefits of cost and spending measurement, and efforts to develop measures

Efficiency and Quality: Controlling Cost Growth in Health Care Reform

Outlines options for slowing the growth of healthcare spending, including improving the Medicare fee schedule, payment for episodes of care, multi-provider episode payments, the tax treatment of private insurance, and comparative effectiveness research

The Current State of Evidence on Bundled Payments

A review of the evidence shows that bundled payments for surgical procedures can generate savings without adversely affecting patient outcomes. Less is known about the effect of bundled payments for chronic medical conditions, but early evidence suggests that cost and quality improvements may be small or non-existent. There is little evidence that bundles reduce access and equity, but continued monitoring is required

Bundling Payment for Episodes of Hospital Care: Issues and Recommendations for the New Pilot Program in Medicare

Outlines the 2010 healthcare reform's provision to launch a pilot project for bundling Medicare payments around hospitalization episodes of care, the rationale for hospital episode bundling, and guidance on designing an effective pilot program

Doing Better by Doing Less: Approaches to Tackle Overuse of Services

Experts have projected that as much as a third of U.S. health care spending is unnecessary and wasteful. Of the estimated $765 billion of health care dollars wasted in 2009, a quarter --$210 billion -- was spent on the overuse of services, which includes services that are provided more frequently than necessary or services that are higher-cost, but no more beneficial than lower-cost alternatives.This paper provides a summary of the problem of overuse in the U.S. health care system. The analysis gives an overview of the provision of medically inappropriate and unnecessary services that drive up health care spending without making a positive impact on patients' health outcomes. It also describes approaches that have already been used to address overuse of health care services and outlines the broader payment reforms needed to minimize incentives to overdiagnose and overtreat.This overuse of services has implications for both health care costs and outcomes. There is substantial variation in the level of inappropriate use across different health care services. Research shows that the rates at which particular procedures, tests, and medications were performed or prescribed when clinically inappropriate ranged from a low of 1 percent to a high of 89 percent

Does How Much and How You Pay Matter? Evidence from the Inpatient Rehabilitation Facility Prospective Payment System

We use the implementation of a new prospective payment system (PPS) for inpatient rehabilitation facilities (IRFs) to investigate the effect of changes in marginal and average reimbursement on costs. The results show that the IRF PPS led to a significant decline in costs and length of stay. Changes in marginal reimbursement associated with the move from a cost based system to a PPS led to a 7 to 11% reduction in costs. The elasticity of costs with respect average reimbursement ranged from 0.26 to 0.34. Finally, the IRF PPS had little or no impact on costs in other sites of care, mortality, or the rate of return to community residence.

Evidence-Informed Case Rates: A New Health Care Payment Model

Suggests a new payment model whereby providers are paid a single, risk-adjusted payment across inpatient and outpatient settings to care for a patient diagnosed with a specific condition

Variations in outcome and costs among NHS providers for common surgical procedures : econometric analyses of routinely collected data

Background: It is important that NHS resources are used to their full extent, but efforts to reduce costs may have an adverse effect on patient outcomes. Our research is designed to provide a better understanding of the inter-relationship between costs and health outcomes among NHS providers (hospitals) for common surgical procedures. Objectives: In England, patient-reported outcomes measures (PROMs) are collected from patients undergoing one of four elective procedures: unilateral hip replacement, unilateral knee replacement, groin hernia repair and varicose vein surgery. We identify variation in patient-reported outcomes (PROs) across hospitals, assess the relationship between the cost and outcomes among NHS hospitals for these procedures, and determine the extent to which variations in outcomes and costs are due to differences in hospital performance. Data sources: We link Hospital Episode Statistics (HES) data with reference cost data and PROM data for patients having the four treatments between April 2009 and March 2010. Methods: The first part of the empirical analysis focuses on variation in different dimensions of self-reported health status. We argue that each of the EuroQol-5D questionnaire (EQ-5D; European Quality of Life-5 Dimensions) dimensions should be assessed separately. Our graphical summary of the differential impact that hospitals have on PROs indicates the probability of reporting a given health outcome and shows how these probabilities vary across EQ–5D dimensions and hospitals. The second part of the empirical analysis focuses on the performance of hospitals and the inter-relationship between PROs and resource use. Results: We find that poorer post-treatment health status is associated with lower initial health status, higher weighted Charlson score, more diagnoses and lower socioeconomic status. We find significantly unexplained variation among hospitals in outcomes for patients undergoing hip replacement, knee replacement or varicose vein surgery, but not for hernia patients. For all four treatments we find significant unexplained variation in resource use among hospitals, whether measured by cost of treatment or length of stay. This suggests that hospitals can improve their utilisation of resources. Limitations: Our analyses are based on the HES. If data are missing from the medical record, or extracted and coded inaccurately, HES will contain errors. Hospitals should minimise these errors. Our study suffers from a large number of missing data, mainly because some hospitals were better than others at administering the baseline survey. Conclusions: There is no general evidence that hospitals with lower resource use have worse health outcomes. There is a significant positive correlation for varicose veins, but this is sensitive to the choice of resource use and PRO measures. For hip and knee replacement the correlation is either insignificant or negative (depending on the resource use and PRO measures), implying that promoting health outcomes and controlling costs are not contradictory objectives. Indeed, we are able to identify hospitals with better than expected outcomes where resource use is below average. Future research should address how to handle missing data, evaluate hospital performance within the broader health economy, communicate PROMs to prospective patients, evaluate the impact of PROMs on patient choice and provider behaviour and evaluate PROMs for people with chronic conditions. Funding: The National Institute for Health Research Health Service and Delivery Research programme

Unsupervised learning for anomaly detection in Australian medical payment data

Fraudulent or wasteful medical insurance claims made by health care providers are costly for insurers. Typically, OECD healthcare organisations lose 3-8% of total expenditure due to fraud. As Australia’s universal public health insurer, Medicare Australia, spends approximately $A 34 billion per annum on the Medicare Benefits Schedule (MBS) and Pharmaceutical Benefits Scheme, wasted spending of$A1–2.7 billion could be expected.However, fewer than 1% of claims to Medicare Australia are detected as fraudulent, below international benchmarks. Variation is common in medicine, and health conditions, along with their presentation and treatment, are heterogenous by nature. Increasing volumes of data and rapidly changing patterns bring challenges which require novel solutions. Machine learning and data mining are becoming commonplace in this field, but no gold standard is yet available. In this project, requirements are developed for real-world application to compliance analytics at the Australian Government Department of Health and Aged Care (DoH), covering: unsupervised learning; problem generalisation; human interpretability; context discovery; and cost prediction. Three novel methods are presented which rank providers by potentially recoverable costs. These methods used association analysis, topic modelling, and sequential pattern mining to provide interpretable, expert-editable models of typical provider claims. Anomalous providers are identified through comparison to the typical models, using metrics based on costs of excess or upgraded services. Domain knowledge is incorporated in a machine-friendly way in two of the methods through the use of the MBS as an ontology. Validation by subject-matter experts and comparison to existing techniques shows that the methods perform well. The methods are implemented in a software framework which enables rapid prototyping and quality assurance. The code is implemented at the DoH, and further applications as decision-support systems are in progress. The developed requirements will apply to future work in this fiel