27 research outputs found
The Effects of Consumer-Directed Health Plans on Health Care Spending
We use unique data from an insurer that exclusively offers high-deductible, "consumer-directed" health plans to identify the effect of plan features, notably the spending account, on health care spending. Our results show that the marginal dollar in the spending account is entirely spent on outpatient and pharmacy services. In contrast, inpatient and out-of-pocket spending were not responsive to the amount in the spending account. Our results represent the first plausibly causal estimates of the components of consumer-driven health plans on health spending. The magnitudes of the effects suggest important moral hazard consequences to higher spending account levels.
Do Hospitals Cross-Subsidize?
Despite its salience as a regulatory tool to ensure the delivery of unprofitable medical services, cross-subsidization of services within hospital systems has been notoriously difficult to detect and quantify. We use repeated shocks to a profitable service in the market for hospital-based medical care to test for cross-subsidization of unprofitable services. Using patient-level data from general short-term hospitals in Arizona and Colorado before and after entry by cardiac specialty hospitals, we study how incumbent hospitals adjusted their provision of three uncontested services that are widely considered to be unprofitable. We estimate that the hospitals most exposed to entry reduced their provision of psychiatric, substance-abuse, and trauma care services at a rate of about one uncontested-service admission for every four cardiac admissions they stood to lose. Although entry by single-specialty hospitals may adversely affect the provision of unprofitable uncontested services, these findings warrant further evaluation of service-line cross-subsidization as a means to finance them
Do Hospitals Cross Subsidize?
Cross-subsidies are often considered the principal mechanism through which hospitals provide unprofitable care. Yet, hospitalsâ reliance on and extent of cross-subsidization are difficult to establish. We exploit entry by cardiac specialty hospitals as an exogenous shock to incumbent hospitalsâ profitability and in turn to their ability to cross-subsidize unprofitable services. Using patient-level data from general short-term hospitals in Arizona and Colorado before and after entry, we find that the hospitals most exposed to entry reduced their provision of services considered to be unprofitable (psychiatric, substance- abuse, and trauma care) and expanded their admissions for neurosurgery, a highly profitable service.
The CareFirst Patient-Centered Medical Home Program: Cost and Utilization Effects in Its First Three Years
Background Enhanced primary care models have diffused slowly and shown uneven results. Because their structural features are costly and challenging for small practices to implement, they offer modest rewards for improved performance, and improvement takes time. Objective To test whether a patient-centered medical home (PCMH) model that significantly rewarded cost savings and accommodated small primary care practices was associated with lower spending, fewer hospital admissions, and fewer emergency room visits. Design We compared medical care expenditures and utilization among adults who participated in the PCMH program to adults who did not participate. We computed difference-in-difference estimates using two-part multivariate generalized linear models for expenditures and negative binomial models for utilization. Control variables included patient demographics, county, chronic condition indicators, and illness severity. Participants A total of 1,433,297 adults aged 18â64 years, residing in Maryland, Virginia, and the District of Columbia, and insured by CareFirst for at least 3 consecutive months between 2010 and 2013. Intervention CareFirst implemented enhanced fee-for-service payments to the practices, offered a large retrospective bonus if annual cost and quality targets were exceeded, and provided information and care coordination support. Measures Outcomes were quarterly claims expenditures per member for all covered services, inpatient care, emergency care, and prescription drugs, and quarterly inpatient admissions and emergency room visits. Results By the third intervention year, annual adjusted total claims payments were 192, â$27), or 2.8 % lower than before the program and compared to those who did not participate. Forty-two percent of the overall decline in spending was explained by lower inpatient care, emergency care, and prescription drug spending. Much of the reduction in inpatient and emergency spending was explained by lower utilization of services. Conclusions A PCMH model that does not require practices to make infrastructure investments and that rewards cost savings can reduce spending and utilization
Racial Disparities in Emergency General Surgery: Do Differences in Outcomes Persist Among Universally Insured Military Patients?
Research Objective: Described as one of the most serious health problems affecting the nation, racial disparities are estimated to account for \u3e83,000 deaths, \u3e$57 billion per year. They have been identified in multiple surgical settings, including differences in outcomes by race among emergency general surgery(EGS) patients. As many minority patients are uninsured, increasing access to care is thought to be a viable solution to mitigate inequities. The objectives of this study were to determine whether racial disparities in 30/90/180day outcomes exist within a universally-insured population of military/civilian-dependent EGS patients and whether differences in outcomes differentially persist in care received at military-vs-civilian hospitals and among sponsors who are enlisted-service members-vs-officers. It also considered longer-term outcomes of care.
Study Design: Risk-adjusted survival analyses using Cox proportional-hazards models assessed race-based differences in mortality, major morbidity, and readmission from index-hospital admission (discharge for readmission) through 30/90/180days. Models accounted for hospital clustering and possible biases associated with missing race (reweighted-estimating equations). Sub-analyses considered effects restricted to operative interventions, stratified by 24 EGS-diagnostic categories defined by the American Association for the Surgery of Trauma(AAST), and effect modification related to rank (SES-proxy: officers-vs-enlisted-sponsors) and military-vs-civilian-hospital care.
Population Studied: Five years of national TRICARE Prime/Prime-plus data, which provides insurance to active/reserve/retired members of the US Armed Services and dependents, were queried for adults (â„18y) with primary EGS conditions, defined by the AAST. Patients who did not have an index admission between 01/01/2006-01/07/2010 (minimum 180days follow-up) or who were not continuously enrolled in TRICARE for 180days were excluded. Non-surviving patients were retained while they survived.
Principal Findings: A total of 101,011 patients were included: 73.5% White, 14.5% Black, 4.4% Asian, 7.7% other. Risk-adjusted analyses reported equivalent-or-better mortality and readmission outcomes among minority patients at 30/90/180daysâeven when restricted to civilian hospitals where studies suggest that EGS disparities are found. Readmissions within military hospitals were lower among minority patients. Major morbidity was higher among Black versus White patients (HR[95%CI]): 30day-1.23[1.13-1.35], 90day-1.18[1.09-1.28], 180day-1.15[1.07-1.24]âa finding driven by appendiceal disorders (HR:1.69-1.70). No other diagnostic category-based HR was significant. When considered by rank, significant effects were isolated to enlisted-service members. However, given the relatively small number of patients who were (dependents of) officers, it is difficult to determine whether rank-based findings are a result of social determinants or influenced by the limited number of minority patients.
Conclusions: The first of its kind to examine racial disparities in longer-term outcomes of EGS care, this longitudinal analysis of military patients demonstrated apparent mitigation of racial disparities within a universally-insured health system when compared to the overall US health system. Efforts to explain findings based on consideration of care provided in military-vs-civilian hospitals, among specific EGS-diagnostic categories, and based on sponsor rank revealed modification of the association between race and outcomes to some extent for all three.
Implications for Policy or Practice: The contrast between results for universally-insured military/civilian-dependent patients and reported disparities among all US civilian patients merits consideration. The data speak to the importance of insurance-coverage in the development of disparities interventions nationwide and will help to inform policy within the DoD
Strategic Response by providers to specialty hospitals, ambulatory surgery centers, and retail clinics.
Radical innovation and disruptive technologies are frequently heralded as a solution to delivering higher quality, lower cost health care. According to the literature on disruption, local hospitals and physicians (incumbent providers) may be unable to competitively respond to such creative destruction and alter their business models for a host of reasons, thus threatening their future survival. However, strategic management theory and research suggest that, under certain conditions, incumbent providers may be able to weather the discontinuities posed by the disrupters. This article analyzes 3 disruptive innovations in service delivery: single-specialty hospitals, ambulatory surgical centers, and retail clinics. We first discuss the features of these innovations to assess how disruptive they are. We then draw on the literature on strategic adaptation to suggest how incumbents develop competitive responses to these disruptive innovations that assure their continued survival. These arguments are then evaluated in a field study of several urban markets based on interviews with both incumbents and entrants. The interviews indicate that entrants have failed to disrupt incumbent providers primarily as a result of strategies pursued by the incumbents. The findings cast doubt on the prospects for these disruptive innovations to transform health care
Strategic Response by Providers to Specialty Hospitals, Ambulatory Surgery Centers, and Retail Clinics
Paying for artificial intelligence in medicine
Over the past 7 years, regulatory agencies have approved hundreds of artificial intelligence (AI) devices for clinical use. In late 2020, payers began reimbursing clinicians and health systems for each use of select image-based AI devices. The experience with traditional medical devices has shown that per-use reimbursement may result in the overuse use of AI. We review current models of paying for AI in medicine and describe five alternative and complementary reimbursement approaches, including incentivizing outcomes instead of volume, utilizing advance market commitments and time-limited reimbursements for new AI applications, and rewarding interoperability and bias mitigation. As AI rapidly integrates into routine healthcare, careful design of payment for AI is essential for improving patient outcomes while maximizing cost-effectiveness and equity