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Buntin MB, Freed SS, Lai P, Lou K, Keohane LM. Trends in and Factors Contributing to the Slowdown in Medicare Spending Growth, 2007-2018. JAMA HEALTH FORUM 2022; 3:e224475. [PMID: 36459161 PMCID: PMC9719052 DOI: 10.1001/jamahealthforum.2022.4475] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Track Full Text] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/03/2022] Open
Abstract
Importance After decades of rapid increase, Medicare per-beneficiary spending growth was historically low in the period leading up to the passage of the Affordable Care Act. In the years immediately following the legislation, Medicare expenditure growth slowed even further. Objective To evaluate factors contributing to the slowdown in Medicare per-beneficiary spending growth. Design, Setting, and Participants In this cross-sectional study, expected spending growth for 2012 to 2015 and 2016 to 2018 was predicted holding payment rates and population characteristics constant. By contrasting predicted and actual spending growth during these periods, the contribution of population vs payment factors to the Medicare spending slowdown was determined. Analyses included all Medicare fee-for-service beneficiaries aged 65 years and older, ranging from 30 to 35 million beneficiaries annually between 2007 and 2018. Data analyses were conducted from January 2018 to August 2018 and updated with new data in June 2021. Main Outcomes and Measures The main outcome included annual growth in total per-beneficiary spending. The roles of payment rate changes and differences in the Medicare population over time were considered, including demographic characteristics and numbers of chronic conditions. Results Between 2008 to 2011 and 2012 to 2015, the adjusted annual Medicare Parts A and B per-beneficiary spending growth rate declined from 3.3% to -0.1%. From 2016 to 2018, the mean annual Medicare spending growth rate rose relative to the previous period but remained lower than in the baseline period at 1.7% per year. This slowdown extended across all sectors within Parts A and B, except for physician-administered drugs offered under Part B. Changes in payment rates (including sequestration measures) and beneficiary characteristics explained 44% of the difference in overall per-beneficiary spending growth between 2007 to 2011 and 2012 to 2015, and 63% between 2007 to 2011 and 2016 to 2018. Conclusions and Relevance In this cross-sectional study of trends in spending growth per Medicare beneficiary aged 65 years or older, results suggested that Medicare payment policy, including sector-specific payment rate changes and sequestration, will be a critical determinant of whether the Medicare spending growth slowdown persists.
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Affiliation(s)
- Melinda B. Buntin
- Department of Health Policy, Vanderbilt University School of Medicine, Nashville, Tennessee
| | - Salama S. Freed
- Department of Health Policy and Management, Milken Institute School of Public Health, The George Washington University, Washington, DC
| | - Pikki Lai
- Department of Health Policy, Vanderbilt University School of Medicine, Nashville, Tennessee,Vanderbilt University School of Medicine, Nashville, Tennessee
| | - Klara Lou
- Department of Health Policy, Vanderbilt University School of Medicine, Nashville, Tennessee
| | - Laura M. Keohane
- Department of Health Policy, Vanderbilt University School of Medicine, Nashville, Tennessee
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Abstract
Numerous provisions of the Affordable Care Act (ACA) were designed to make health care more affordable, yet the act's cumulative effects on health care costs are still debated. A key question is whether or not the ACA reduced the annual rate at which total national health care spending increased and brought per capita spending growth rates down. We review the direct and indirect effects of the ACA on spending across segments of the health insurance market. We highlight areas where the ACA has affected spending, but we emphasize that the ACA's long-run impact on spending will depend on sustaining the adjustments made to provider payment systems and expanding the emphasis on value across payers throughout the ACA's second decade and beyond.
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Affiliation(s)
- Melinda Beeuwkes Buntin
- Melinda Beeuwkes Buntin ( melinda. buntin@vanderbilt. edu ) is the Mike Curb Professor of Health Policy and chair of the Department of Health Policy, Vanderbilt University School of Medicine, in Nashville, Tennessee
| | - John A Graves
- John A. Graves is an associate professor in the Department of Health Policy, Vanderbilt University School of Medicine
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3
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Cutler DM, Ghosh K, Messer KL, Raghunathan TE, Stewart ST, Rosen AB. Explaining The Slowdown In Medical Spending Growth Among The Elderly, 1999-2012. Health Aff (Millwood) 2020; 38:222-229. [PMID: 30715965 DOI: 10.1377/hlthaff.2018.05372] [Citation(s) in RCA: 24] [Impact Index Per Article: 4.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/25/2022]
Abstract
We examined trends in per capita spending for Medicare beneficiaries ages sixty-five and older in the United States in the period 1999-2012 to determine why spending growth has been declining since around 2005. Decomposing spending by condition, we found that half of the spending slowdown was attributable to slower growth in spending for cardiovascular diseases. Spending growth also slowed for dementia, renal and genitourinary diseases, and aftercare for people with acute illnesses. Using estimates from the medical literature of the impact of pharmaceuticals on acute disease, we found that roughly half of the reduction in major cardiovascular events was attributable to medications controlling cardiovascular risk factors. Despite this substantial cost-saving improvement in cardiovascular health, additional opportunities remain to lower spending through disease prevention and control.
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Affiliation(s)
- David M Cutler
- David M. Cutler ( ) is the Otto Eckstein Professor of Applied Economics in the Department of Economics at Harvard University and a research associate at the National Bureau of Economic Research, both in Cambridge, Massachusetts
| | - Kaushik Ghosh
- Kaushik Ghosh is a research specialist at the National Bureau of Economic Research in Cambridge
| | - Kassandra L Messer
- Kassandra L. Messer is a research associate at the Institute for Social Research, University of Michigan, in Ann Arbor
| | - Trivellore E Raghunathan
- Trivellore E. Raghunathan is a professor of biostatistics in the Department of Biostatistics and director and research professor at the Survey Research Center and Institute for Social Research, all at the University of Michigan
| | - Susan T Stewart
- Susan T. Stewart is a research specialist at the National Bureau of Economic Research in Cambridge
| | - Allison B Rosen
- Allison B. Rosen is an associate professor in the Department of Quantitative Health Sciences, University of Massachusetts Medical School, in Worcester
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Kim D, Do W, Tajmir S, Mahal B, DeAngelis J, Ramappa A. Mandated health insurance increases rates of elective knee surgery. World J Orthop 2019; 10:81-89. [PMID: 30788225 PMCID: PMC6379740 DOI: 10.5312/wjo.v10.i2.81] [Citation(s) in RCA: 2] [Impact Index Per Article: 0.3] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 12/21/2018] [Revised: 01/11/2019] [Accepted: 01/26/2019] [Indexed: 02/06/2023] Open
Abstract
BACKGROUND The recent federal ruling to against Affordable Care Act (ACA), specifically the mandate requiring people to buy insurance, has once again brought the healthcare reform debate to the spotlight. The ACA increased the number of insured Americans through the development of subsidized healthcare plans and health insurance exchanges. Insurance-based differences in the rate of upper extremity elective orthopaedic surgery have been described before and after healthcare reform in Massachusetts, where a similar mandate was put into place years before the ACA was passed. However, no comprehensive study has evaluated insurance-based differences of knee elective surgery before and after reform.
AIM To investigate how an individual mandate to purchase health insurance affects rates of knee surgery.
METHODS A retrospective review was performed within an orthopaedic surgery department at a tertiary-care, academic medical center in Massachusetts. The rate of elective knee surgery performed before and after the healthcare reform (2005-2006 and 2007-2010, respectively) was calculated. The patients were categorized by insurance type (Commonwealth Care, Medicare, Medicaid, private insurance, Workers’ Compensation, TriCare, and Uninsured). Using χ2 testing, differences in rates of surgery between the pre-reform and post-reform period and among insurance subgroups were calculated.
RESULTS Rate of surgery increased in the post-reform period (pre-reform 8.07% (95%CI: 7.03%-9.11%), post-reform 9.38% (95%CI: 8.74%-10.03%) (P = 0.04) and was statistically significant. When the insurance groups and insurance types were compared, the rates of surgery are not significantly different before or after reform.
CONCLUSION The increase in the rate of elective knee surgery in the post-reform period suggests that health care reform in Massachusetts has been successful in decreasing the uninsured population and may increase health care expenditures. This is a hypothesis generating study that suggests further avenues of study on how mandated coverage may change healthcare utilization and cost.
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Affiliation(s)
- Daniel Kim
- Radiation Oncology, Massachusetts General Hospital, Harvard Medical School, Boston, MA 02114, United States
| | - Woo Do
- Department of Surgery, Madigan Army Medical Center, Tacoma, WA 98431, United States
| | - Shahein Tajmir
- Radiology, Massachusetts General Hospital, Harvard Medical School, Boston, MA 02114, United States
| | - Brandon Mahal
- Radiation Oncology, Massachusetts General Hospital, Harvard Medical School, Boston, MA 02114, United States
| | - Joe DeAngelis
- Department of Orthopaedic Surgery, Beth Israel Deaconess Medical Center, Harvard Medical School, Boston, MA 02215, United States
| | - Arun Ramappa
- Department of Orthopaedic Surgery, Beth Israel Deaconess Medical Center, Harvard Medical School, Boston, MA 02215, United States
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Abstract
Rich federal data resources provide essential data inputs for monitoring the health and health care of the US population and are essential for conducting health services policy research. The six household surveys we document in this article cover a broad array of health topics, including health insurance coverage (American Community Survey, Current Population Survey), health conditions and behaviors (National Health Interview Survey, Behavioral Risk Factor Surveillance System), health care utilization and spending (Medical Expenditure Panel Survey), and longitudinal data on public program participation (SIPP). New federal activities are linking federal surveys with administrative data to reduce duplication and response burden. In the private sector, vendors are aggregating data from medical records and claims to enhance our understanding of treatment, quality, and outcomes of medical care. Federal agencies must continue to innovate to meet the continuous challenges of scarce resources, pressures for more granular data, and new multimode data collection methodologies.
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Affiliation(s)
- Lynn A Blewett
- Division of Health Policy and Management, School of Public Health, University of Minnesota, Minneapolis, Minnesota 55414, USA; , ,
| | - Kathleen Thiede Call
- School of Public Health, University of Minnesota, Minneapolis, Minnesota 55455, USA;
| | - Joanna Turner
- Division of Health Policy and Management, School of Public Health, University of Minnesota, Minneapolis, Minnesota 55414, USA; , ,
| | - Robert Hest
- Division of Health Policy and Management, School of Public Health, University of Minnesota, Minneapolis, Minnesota 55414, USA; , ,
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Conti RM, Fein AJ, Bhatta SS. National trends in spending on and use of oral oncologics, first quarter 2006 through third quarter 2011. Health Aff (Millwood) 2016; 33:1721-7. [PMID: 25288415 DOI: 10.1377/hlthaff.2014.0001] [Citation(s) in RCA: 45] [Impact Index Per Article: 5.0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
Oral prescription drugs are an increasingly important treatment option for cancer. Yet contemporaneous US trends in spending on anticancer drugs known as oral oncologics have not been described. Using nationally representative data, we describe trends in national spending on and use of forty-seven oral oncologics between the first quarter of 2006 and the third quarter of 2011. Average quarterly national spending on oral oncologics increased 37 percent, from $940.3 million to $1.4 billion in 2012 dollars, a significant change. Average quarterly use of oral oncologics in the same time period measured in extended units increased at a significant pace but more slowly than spending (10 percent). Within this broader trend, differences in spending among categories of oral oncologics were observed. High levels of and increases in both spending and use were concentrated among new brand-name and patent-protected oral oncologics, including second-generation tyrosine kinase inhibitors used to treat chronic myelogenous leukemia. Decreased spending but increased use was observed among oral oncologics that lost patent protection during the study period and were available in generic form, including hormonal therapies used to treat breast and prostate cancers. Spending on new and patent-protected oral oncologics and associated price increases are significant drivers of increased spending.
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Affiliation(s)
- Rena M Conti
- Rena M. Conti is an assistant professor of health policy and economics in the Departments of Pediatrics and Health Studies at the University of Chicago, in Illinois
| | - Adam J Fein
- Adam J. Fein is president of Pembroke Consulting, Inc., in Philadelphia, Pennsylvania
| | - Sumita S Bhatta
- Sumita S. Bhatta is an instructor in the Department of Medicine, Section of Hematology and Oncology, the University of Chicago
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Powell V, Saloner B, Sabik LM. Cost Sharing in Medicaid: Assumptions, Evidence, and Future Directions. Med Care Res Rev 2016; 73:383-409. [PMID: 26602175 PMCID: PMC4879115 DOI: 10.1177/1077558715617381] [Citation(s) in RCA: 14] [Impact Index Per Article: 1.6] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/20/2015] [Accepted: 10/23/2015] [Indexed: 12/29/2022]
Abstract
Several states have received waivers to expand Medicaid to poor adults under the Affordable Care Act using more cost sharing than the program traditionally allows. We synthesize literature on the effects of cost sharing, focusing on studies of low-income U.S. populations from 1995 to 2014. Literature suggests that cost sharing has a deterrent effect on initiation of treatments, and can reduce utilization of ongoing treatments. Furthermore, cost sharing may be difficult for low-income populations to understand, patients often lack sufficient information to choose medical treatment, and cost sharing may be difficult to balance within the budgets of poor adults. Gaps in the literature include evidence of long-term effects of cost sharing on health and financial well-being, evidence related to effectiveness of cost sharing combined with patient education, and evidence related to targeted programs that use financial incentives for wellness. Literature underscores the need for evaluation of the effects of cost sharing on health status and spending, particularly among the poorest adults.
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Affiliation(s)
- Victoria Powell
- Johns Hopkins University School of Medicine, Baltimore, MD, USA
| | - Brendan Saloner
- Johns Hopkins Bloomberg School of Public Health, Baltimore, MD, USA
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Dranove D, Garthwaite C, Ody C. Health spending slowdown is mostly due to economic factors, not structural change in the health care sector. Health Aff (Millwood) 2016; 33:1399-406. [PMID: 25092842 DOI: 10.1377/hlthaff.2013.1416] [Citation(s) in RCA: 24] [Impact Index Per Article: 2.7] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/19/2022]
Abstract
The source of the recent slowdown in health spending growth remains unclear. We used new and unique data on privately insured people to estimate the effect of the economic slowdown that began in December 2007 on the rate of growth in health spending. By exploiting regional variations in the severity of the slowdown, we determined that the economic slowdown explained approximately 70 percent of the slowdown in health spending growth for the people in our sample. This suggests that the recent decline is not primarily the result of structural changes in the health sector or of components of the Affordable Care Act, and that-absent other changes in the health care system-an economic recovery will result in increased health spending.
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Affiliation(s)
- David Dranove
- David Dranove is the Walter McNerney Professor of Health Industry Management at the Kellogg School of Management, Northwestern University, in Evanston, Illinois
| | - Craig Garthwaite
- Craig Garthwaite is an assistant professor of mangement and strategy at the Kellogg School of Management
| | - Christopher Ody
- Christopher Ody is a research assistant professor of health enterprise management at the Kellogg School of Management
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Dickman SL, Woolhandler S, Bor J, McCormick D, Bor DH, Himmelstein DU. Health Spending For Low-, Middle-, And High-Income Americans, 1963–2012. Health Aff (Millwood) 2016; 35:1189-96. [DOI: 10.1377/hlthaff.2015.1024] [Citation(s) in RCA: 32] [Impact Index Per Article: 3.6] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Affiliation(s)
- Samuel L. Dickman
- Samuel L. Dickman ( ) was a student at Harvard Medical School, in Boston, Massachusetts, at the time this work was carried out. He is currently a medical intern at the University of California, San Francisco
| | - Steffie Woolhandler
- Steffie Woolhandler is a professor of health policy at Hunter College, City University of New York, in New York City, and a lecturer in medicine at Harvard Medical School
| | - Jacob Bor
- Jacob Bor is an assistant professor in the Departments of Global Health and Epidemiology at the Boston University School of Public Health, in Massachusetts
| | - Danny McCormick
- Danny McCormick is an associate professor of medicine at Harvard Medical School and chief of the Division of Social and Community Medicine in the Department of Medicine at the Cambridge Health Alliance, in Cambridge, Massachusetts
| | - David H. Bor
- David H. Bor is an associate professor of medicine at Harvard Medical School and chief of the Department of Medicine at the Cambridge Health Alliance
| | - David U. Himmelstein
- David U. Himmelstein is a professor of health policy at Hunter College, City University of New York, and a lecturer in medicine at Harvard Medical School
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Stadhouders N, Koolman X, Tanke M, Maarse H, Jeurissen P. Policy options to contain healthcare costs: a review and classification. Health Policy 2016; 120:486-94. [DOI: 10.1016/j.healthpol.2016.03.007] [Citation(s) in RCA: 15] [Impact Index Per Article: 1.7] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 11/26/2015] [Revised: 02/24/2016] [Accepted: 03/10/2016] [Indexed: 12/29/2022]
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11
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Bradley CJ, Yabroff KR, Warren JL, Zeruto C, Chawla N, Lamont EB. Trends in the Treatment of Metastatic Colon and Rectal Cancer in Elderly Patients. Med Care 2016; 54:490-7. [DOI: 10.1097/mlr.0000000000000510] [Citation(s) in RCA: 41] [Impact Index Per Article: 4.6] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
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Kan H, Nagar S, Patel J, Wallace DJ, Molta C, Chang DJ. Longitudinal Treatment Patterns and Associated Outcomes in Patients With Newly Diagnosed Systemic Lupus Erythematosus. Clin Ther 2016; 38:610-24. [PMID: 26907503 DOI: 10.1016/j.clinthera.2016.01.016] [Citation(s) in RCA: 23] [Impact Index Per Article: 2.6] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 09/30/2015] [Revised: 11/20/2015] [Accepted: 01/22/2016] [Indexed: 12/29/2022]
Abstract
PURPOSE The treatment of systemic lupus erythematosus (SLE) is complex, with a wide range of drugs commonly prescribed. The aims of this study were to identify longitudinal treatment patterns in patients with incident SLE and to estimate the associations of treatment patterns with clinical and economic outcomes. METHODS This retrospective, observational cohort study used a US managed care claims database to identify patients with newly diagnosed SLE and 4-year treatment follow-up. Patients were aged ≥ 18 years, with continuous medical and pharmacy benefits for 12 months before and 48 months after the index date (first medical claim with a diagnosis of SLE). Longitudinal treatment patterns were grouped using a k-means cluster analysis. Therapies were included in the cluster analysis if the mean number of prescriptions in each year was ≥ 0.05. Clinical and economic outcomes were compared across clusters using multivariate regression analyses. FINDINGS Data from 1611 patients with incident SLE were analyzed (91.4% women; mean [SD] age, 44.5 [9.5] years; 56.2% managed primarily by a specialist). Hydroxychloroquine and corticosteroids were the most commonly prescribed therapies; methotrexate, azathioprine, and mycophenolate mofetil also met the criteria for inclusion in the cluster analysis. Ten treatment clusters were identified; the most common was minimally treated patients (42.8%). Hydroxychloroquine monotherapy, corticosteroid monotherapy, and corticosteroid/hydroxychloroquine combination therapy were received by 34.0%, 11.2%, and 7.8% of patients, respectively. Methotrexate or azathioprine with a corticosteroid/hydroxychloroquine were received by 4.2% of patients. Changes in therapy, except discontinuations, were rare. Compared with the minimally treated cluster, those that received corticosteroid monotherapy (mean dose, >12.0 mg/d) had poorer clinical and economic outcomes; the hydroxychloroquine-monotherapy cluster had similar or better outcomes; and patients who received a corticosteroid/hydroxychloroquine with or without methotrexate or azathioprine demonstrated outcomes that were poorer but that appeared better than those with corticosteroid monotherapy. SLE-related visits with a nonspecialist were common (~45%) and remained unchanged over time despite better clinical and economic outcomes associated with specialist visits. IMPLICATIONS This study utilized cluster analysis, an unsupervised machine-learning method, to systematically discern treatment patterns over 4 years and to estimate outcomes associated with the identified treatment patterns. The results suggest that minimal treatment is the most common approach in patients with newly diagnosed SLE. Clinical and economic outcomes are poorest with corticosteroid monotherapy but may improve with the addition of hydroxychloroquine and/or an immunosuppressive agent. A large proportion of SLE care is provided by nonspecialists despite the potential benefits of involving a specialist.
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Affiliation(s)
- Hong Kan
- GlaxoSmithKline, Research Triangle Park, North Carolina.
| | - Saurabh Nagar
- GlaxoSmithKline, Research Triangle Park, North Carolina
| | - Jeetvan Patel
- GlaxoSmithKline, Research Triangle Park, North Carolina
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Herring B, Trish E. Explaining the Growth in US Health Care Spending Using State-Level Variation in Income, Insurance, and Provider Market Dynamics. INQUIRY : A JOURNAL OF MEDICAL CARE ORGANIZATION, PROVISION AND FINANCING 2015; 52:0046958015618971. [PMID: 26655685 PMCID: PMC5678448 DOI: 10.1177/0046958015618971] [Citation(s) in RCA: 4] [Impact Index Per Article: 0.4] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Figures] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
The slowed growth in national health care spending over the past decade has led analysts to question the extent to which this recent slowdown can be explained by predictable factors such as the Great Recession or must be driven by some unpredictable structural change in the health care sector. To help address this question, we first estimate a regression model for state personal health care spending for 1991-2009, with an emphasis on the explanatory power of income, insurance, and provider market characteristics. We then use the results from this simple predictive model to produce state-level projections of health care spending for 2010-2013 to subsequently compare those average projected state values with actual national spending for 2010-2013, finding that at least 70% of the recent slowdown in health care spending can likely be explained by long-standing patterns. We also use the results from this predictive model to both examine the Great Recession's likely reduction in health care spending and project the Affordable Care Act's insurance expansion's likely increase in health care spending.
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Affiliation(s)
- Bradley Herring
- Johns Hopkins Bloomberg School of Public Health, Baltimore, MD, USA
| | - Erin Trish
- University of Southern California, Los Angeles, CA, USA
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Vistnes J, Selden TM, Zawacki A. Several Factors Responsible For The Recent Slowdown In Premium Growth In Employer-Sponsored Insurance. Health Aff (Millwood) 2015; 34:2036-43. [PMID: 26643623 DOI: 10.1377/hlthaff.2015.0436] [Citation(s) in RCA: 2] [Impact Index Per Article: 0.2] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
Containing growth in health care spending is important to the long-term fiscal health of the United States. Researchers have been seeking to identify which factors behind the recent spending slowdown might continue to have an impact after the economy has fully recovered from the Great Recession (2007-09). We extended this inquiry by decomposing trends in the growth of private-sector employer-sponsored insurance premiums. Using data for 2001-13 from the Medical Expenditure Panel Survey-Insurance Component and a combination of cell- and regression-based decomposition methods, we found that the slowdown in premium growth that preceded the recession reflected declining growth rates in per policyholder premiums. For 2009-11, however, the dominant contributors to the slowdown were factors underlying declining employee enrollment: a sharp downturn in employment in 2009, followed by eroding offer and eligibility rates. Growth in per policyholder premiums slowed in 2012 and 2013 compared to the preceding few years. Like other researchers, we found that a substantial portion of premium growth remained unexplained. However, it is likely driven, in part, by growth in the underlying cost of medical care.
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Affiliation(s)
- Jessica Vistnes
- Jessica Vistnes is a senior economist at the Agency for Heathcare Research and Quality (AHRQ), in Rockville, Maryland
| | - Thomas M Selden
- Thomas M. Selden is director of the Division of Research and Modeling in the Center for Financing, Access, and Cost Trends at AHRQ
| | - Alice Zawacki
- Alice Zawacki is a senior economist at the Census Bureau, in Washington, D.C
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15
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Sullivan SD, Yeung K, Vogeler C, Ramsey SD, Wong E, Murphy CO, Danielson D, Veenstra DL, Garrison LP, Burke W, Watkins JB. Design, implementation, and first-year outcomes of a value-based drug formulary. J Manag Care Spec Pharm 2015; 21:269-75. [PMID: 25803760 PMCID: PMC10398289 DOI: 10.18553/jmcp.2015.21.4.269] [Citation(s) in RCA: 25] [Impact Index Per Article: 2.5] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/05/2022]
Abstract
BACKGROUND Value-based insurance design attempts to align drug copayment tier with value rather than cost. Previous implementations of value-based insurance design have lowered copayments for drugs indicated for select "high value" conditions and have found modest improvements in medication adherence. However, these implementations have generally not resulted in cost savings to the health plan, suggesting a need for increased copayments for "low value" drugs. Further, previous implementations have assigned equal copayment reductions to all drugs within a therapeutic area without assessing the value of individual drugs. Aligning the individual drug's copayment to its specific value may yield greater clinical and economic benefits. In 2010, Premera Blue Cross, a large not-for-profit health plan in the Pacific Northwest, implemented a value-based drug formulary (VBF) that explicitly uses cost-effectiveness analyses after safety and efficacy reviews to estimate the value of each individual drug. Concurrently, Premera increased copayments for existing tiers. OBJECTIVE To describe and evaluate the design, implementation, and first-year outcomes of the VBF. METHODS We compared observed pharmacy cost per member per month in the year following the VBF implementation with 2 comparator groups: (1) observed pharmacy costs in the year prior to implementation, and (2) expected costs if no changes were made to the pharmacy benefits. Expected costs were generated by applying autoregressive integrated moving averages to pharmacy costs over the previous 36 months. We used an interrupted time series analysis to assess drug use and adherence among individuals with diabetes, hypertension, or dyslipidemia compared with a group of members in plans that did not implement a VBF. RESULTS Pharmacy costs decreased by 3% compared with the 12 months prior and 11% compared with expected costs. There was no significant decline in medication use or adherence to treatments for patients with diabetes, hypertension, or dyslipidemia. CONCLUSIONS The VBF and copayment changes enabled pharmacy plan cost savings without negatively affecting utilization in key disease states.
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Affiliation(s)
- Sean D Sullivan
- University of Washington, 1959 N.E. Pacific Ave., Seattle, WA 98196.
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16
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Romley JA, Goldman DP, Sood N. US hospitals experienced substantial productivity growth during 2002-11. Health Aff (Millwood) 2015; 34:511-8. [PMID: 25673334 DOI: 10.1377/hlthaff.2014.0587] [Citation(s) in RCA: 15] [Impact Index Per Article: 1.5] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
The need for better value in US health care is widely recognized. Existing evidence suggests that improvement in the productivity of American hospitals-that is, the output that hospitals produce from inputs such as labor and capital-has lagged behind that of other industries. However, previous studies have not adequately addressed quality of care or severity of patient illness. Our study, by contrast, adjusts for trends in the severity of patients' conditions and health outcomes. We studied productivity growth among US hospitals in treating Medicare patients with heart attack, heart failure, and pneumonia during 2002-11. We found that the rates of annual productivity growth were 0.78 percent for heart attack, 0.62 percent for heart failure, and 1.90 percent for pneumonia. However, unadjusted productivity growth appears to have been negative. These findings suggest that productivity growth in US health care could be better than is sometimes believed, and may help alleviate concerns about Medicare payment policy under the Affordable Care Act.
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Affiliation(s)
- John A Romley
- John A. Romley is an economist at the Leonard D. Schaeffer Center for Health Policy and Economics and a research assistant professor in the Sol Price School of Public Policy, both at the University of Southern California, in Los Angeles
| | - Dana P Goldman
- Dana P. Goldman is the Leonard D. Schaeffer Director's Chair and director of the Leonard D. Schaeffer Center for Health Policy and Economics, and a professor of public policy, pharmacy, and economics in the School of Pharmacy, Sol Price School of Public Policy, and Dornsife College of Letters, Arts, and Sciences, all at the University of Southern California
| | - Neeraj Sood
- Neeraj Sood is an associate professor of health economics and director of research at the Leonard D. Schaeffer Center for Health Policy and Economics at the University of Southern California
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17
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Franzini L, Taychakhoonavudh S, Parikh R, White C. Medicare and private spending trends from 2008 to 2012 diverge in Texas. Med Care Res Rev 2014; 72:96-112. [PMID: 25550272 DOI: 10.1177/1077558714563174] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.3] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
The recent relatively slow growth in health care spending masks significant differences among payers, clinical settings, and geographic areas. To better understand the spending slowdown, we focus on 2008-2012 trends in Texas among Medicare fee-for-service beneficiaries and enrollees in Blue Cross Blue Shield of Texas (BCBSTX). Spending per person for Medicare grew only 1.5% per year on average, compared with 5.2% for BCBSTX. In Medicare, utilization rates were relatively flat, while prices grew more slowly than input prices. In BCBSTX, spending growth was driven by increases in negotiated prices, in particular hospital prices. We find that geographic variation declined sharply in Medicare, due to drops in spending on post-acute care in two notoriously high-spending regions but rose slightly in BCBSTX. The aggregate spending trends mask two divergent stories: spending growth in Medicare is very slow, but price increases continue to drive unsustainable spending growth among the privately insured.
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Affiliation(s)
- Luisa Franzini
- University of Texas School of Public Health, Houston, TX, USA
| | | | - Rohan Parikh
- University of Texas School of Public Health, Houston, TX, USA
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Herrera CN, Gaynor M, Newman D, Town RJ, Parente ST. Trends underlying employer-sponsored health insurance growth for Americans younger than age sixty-five. Health Aff (Millwood) 2014; 32:1715-22. [PMID: 24101060 DOI: 10.1377/hlthaff.2013.0556] [Citation(s) in RCA: 6] [Impact Index Per Article: 0.5] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
Little is known about the trends in health care spending for the 156 million Americans who are younger than age sixty-five and enrolled in employer-sponsored health insurance. Using a new source of health insurance claims data, we estimated per capita spending, utilization, and prices for this population between 2007 and 2011. During this period per capita spending on employer-sponsored insurance grew at historically slow rates, but still faster than per capita national health expenditures. Total per capita spending for employer-sponsored insurance grew at an average annual rate of 4.9 percent, with prescription spending growing at 3.3 percent and medical spending growing at 5.3 percent. Out-of-pocket medical spending increased at an average annual rate of 8.0 percent, whereas out-of-pocket prescription drug spending growth was flat. Growth in the use of medical services and prescription drugs slowed. Medical price growth accelerated, and prescription price growth decelerated. As a result, changes in utilization contributed less than changes in price did to overall spending growth for those with employer-sponsored insurance.
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19
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Shaw FE, Asomugha CN, Conway PH, Rein AS. The Patient Protection and Affordable Care Act: opportunities for prevention and public health. Lancet 2014; 384:75-82. [PMID: 24993913 DOI: 10.1016/s0140-6736(14)60259-2] [Citation(s) in RCA: 81] [Impact Index Per Article: 7.4] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
The Patient Protection and Affordable Care Act, which was enacted by the US Congress in 2010, marks the greatest change in US health policy since the 1960s. The law is intended to address fundamental problems within the US health system, including the high and rising cost of care, inadequate access to health insurance and health services for many Americans, and low health-care efficiency and quality. By 2019, the law will bring health coverage--and the health benefits of insurance--to an estimated 25 million more Americans. It has already restrained discriminatory insurance practices, made coverage more affordable, and realised new provisions to curb costs (including tests of new health-care delivery models). The new law establishes the first National Prevention Strategy, adds substantial new funding for prevention and public health programmes, and promotes the use of recommended clinical preventive services and other measures, and thus represents a major opportunity for prevention and public health. The law also provides impetus for greater collaboration between the US health-care and public health systems, which have traditionally operated separately with little interaction. Taken together, the various effects of the Patient Protection and Affordable Care Act can advance the health of the US population.
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Affiliation(s)
- Frederic E Shaw
- US Centers for Disease Control and Prevention, Atlanta, GA, USA
| | | | | | - Andrew S Rein
- US Centers for Disease Control and Prevention, Atlanta, GA, USA.
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20
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Lorenzoni L, Belloni A, Sassi F. Health-care expenditure and health policy in the USA versus other high-spending OECD countries. Lancet 2014; 384:83-92. [PMID: 24993914 DOI: 10.1016/s0140-6736(14)60571-7] [Citation(s) in RCA: 72] [Impact Index Per Article: 6.5] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
The USA has exceptional levels of health-care expenditure, but growth has slowed dramatically in recent years, amidst major efforts to close the coverage gap with other countries of the Organisation for Economic Co-operation and Development (OECD). We reviewed expenditure trends and key policies since 2000 in the USA and five other high-spending OECD countries. Higher health-sector prices explain much of the difference between the USA and other high-spending countries, and price dynamics are largely responsible for the slowdown in expenditure growth. Other high-spending countries did not face the same coverage challenges, and could draw from a broader set of policies to keep expenditure under control, but expenditure growth was similar to the USA. Tightening Medicare and Medicaid price controls on plans and providers, and leveraging the scale of the public programmes to increase efficiency in financing and care delivery, might prevent a future economic recovery from offsetting the slowdown in health sector prices and expenditure growth.
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Affiliation(s)
- Luca Lorenzoni
- Health Division, Organisation for Economic Co-operation and Development (OECD), Paris, France.
| | - Annalisa Belloni
- Health Division, Organisation for Economic Co-operation and Development (OECD), Paris, France
| | - Franco Sassi
- Health Division, Organisation for Economic Co-operation and Development (OECD), Paris, France
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21
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Fung V, Graetz I, Galbraith A, Hamity C, Huang J, Vollmer WM, Hsu J, Wu AC. Financial barriers to care among low-income children with asthma: health care reform implications. JAMA Pediatr 2014; 168:649-56. [PMID: 24840805 PMCID: PMC7105170 DOI: 10.1001/jamapediatrics.2014.79] [Citation(s) in RCA: 37] [Impact Index Per Article: 3.4] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 12/29/2022]
Abstract
IMPORTANCE The Patient Protection and Affordable Care Act (ACA) includes subsidies that reduce patient cost sharing for low-income families. Limited information on the effects of cost sharing among children is available to guide these efforts. OBJECTIVE To examine the associations between cost sharing, income, and care seeking and financial stress among children with asthma. DESIGN, SETTING, AND PARTICIPANTS A telephone survey in 2012 about experiences during the prior year within an integrated health care delivery system. Respondents included 769 parents of children aged 4 to 11 years with asthma. Of these, 25.9% of children received public subsidies; 21.7% were commercially insured with household incomes at or below 250% of the federal poverty level (FPL) and 18.2% had higher cost-sharing levels for all services (e.g., ≥$75 for emergency department visits). We classified children with asthma based on (1) current receipt of a subsidy (i.e., Medicaid or Children's Health Insurance Program) or potential eligibility for ACA low-income cost sharing or premium subsidies in 2014 (i.e., income ≤250%, 251%-400%, or >400% of the FPL) and (2) cost-sharing levels for prescription drugs, office visits, and emergency department visits. We examined the frequency of changes in care seeking and financial stress due to asthma care costs across these groups using logistic regression, adjusted for patient/family characteristics. MAIN OUTCOMES AND MEASURES Switching to cheaper asthma drugs, using less medication than prescribed, delaying/avoiding any office or emergency department visits, and financial stress (eg, cutting back on necessities) because of the costs of asthma care. RESULTS After adjustment, parents at or below 250% of the FPL with lower vs higher cost-sharing levels were less likely to delay or avoid taking their children to a physician's office visit (3.8% vs. 31.6%; odds ratio, 0.07 [95% CI, 0.01-0.39]) and the emergency department (1.2% vs. 19.4%; 0.05 [0.01-0.25]) because of cost; higher-income parents and those whose children were receiving public subsidies (eg, Medicaid) were also less likely to forego their children's care than parents at or below 250% of the FPL with higher cost-sharing levels. Overall, 15.6% of parents borrowed money or cut back on necessities to pay for their children's asthma care. CONCLUSIONS AND RELEVANCE Cost-related barriers to care among children with asthma were concentrated among low-income families with higher cost-sharing levels. The ACA's low-income subsidies could reduce these barriers for many families, but millions of dependents for whom employer-sponsored family coverage is unaffordable could remain at risk for cost-related problems because of ACA subsidy eligibility rules.
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Affiliation(s)
- Vicki Fung
- Mongan Institute for Health Policy, Massachusetts General Hospital, Boston,Department of Medicine, Harvard Medical School, Boston, Massachusetts
| | - Ilana Graetz
- Division of Research, Kaiser Permanente Northern California, Oakland,Department of Preventive Medicine, University of Tennessee Health Science Center, Memphis
| | - Alison Galbraith
- Center for Child Health Care Studies, Department of Population Medicine, Harvard Medical School and Harvard Pilgrim Health Care Institute, Boston, Massachusetts
| | - Courtnee Hamity
- School of Public Health, University of California, Berkeley,Division of Research, Kaiser Permanente Northern California, Oakland
| | - Jie Huang
- Division of Research, Kaiser Permanente Northern California, Oakland
| | - William M. Vollmer
- Center for Health Research, Kaiser Permanente Northwest, Portland, Oregon
| | - John Hsu
- Mongan Institute for Health Policy, Massachusetts General Hospital, Boston,Department of Medicine, Harvard Medical School, Boston, Massachusetts,Department of Health Care Policy, Harvard Medical School, Boston, Massachusetts
| | - Ann Chen Wu
- Center for Child Health Care Studies, Department of Population Medicine, Harvard Medical School and Harvard Pilgrim Health Care Institute, Boston, Massachusetts
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22
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Pellikka PA. Value of echocardiography in an era of healthcare reform. Prog Cardiovasc Dis 2014; 57:1-2. [PMID: 25081396 DOI: 10.1016/j.pcad.2014.05.008] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 10/25/2022]
Abstract
Considering the rising costs of healthcare and the availability of multiple types of cardiovascular imaging, careful consideration must be given to selection of the most appropriate imaging modality. The value equation, which considers the benefits relative to the cost, is described for echocardiography. As described in the articles in this issue, echocardiography has become central to the assessment of patients with a broad variety of cardiac conditions.
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Affiliation(s)
- Patricia A Pellikka
- Mayo Clinic College of Medicine, Rochester, MN, USA; Division of Cardiovacular Diseases, Mayo Clinic, Rochester, MN, USA.
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23
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Clemens T, Michelsen K, Commers M, Garel P, Dowdeswell B, Brand H. European hospital reforms in times of crisis: aligning cost containment needs with plans for structural redesign? Health Policy 2014; 117:6-14. [PMID: 24703855 DOI: 10.1016/j.healthpol.2014.03.008] [Citation(s) in RCA: 24] [Impact Index Per Article: 2.2] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 09/04/2013] [Revised: 03/06/2014] [Accepted: 03/09/2014] [Indexed: 12/29/2022]
Abstract
Hospitals have become a focal point for health care reform strategies in many European countries during the current financial crisis. It has been called for both, short-term reforms to reduce costs and long-term changes to improve the performance in the long run. On the basis of a literature and document analysis this study analyses how EU member states align short-term and long-term pressures for hospital reforms in times of the financial crisis and assesses the EU's influence on the national reform agenda. The results reveal that there has been an emphasis on cost containment measures rather than embarking on structural redesign of the hospital sector and its position within the broader health care system. The EU influences hospital reform efforts through its enhanced economic framework governance which determines key aspects of the financial context for hospitals in some countries. In addition, the EU health policy agenda which increasingly addresses health system questions stimulates the process of structural hospital reforms by knowledge generation, policy advice and financial incentives. We conclude that successful reforms in such a period would arguably need to address both the organisational and financing sides to hospital care. Moreover, critical to structural reform is a widely held acknowledgement of shortfalls in the current system and belief that new models of hospital care can deliver solutions to overcome these deficits. Advancing the structural redesign of the hospital sector while pressured to contain cost in the short-term is not an easy task and only slowly emerging in Europe.
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Affiliation(s)
- Timo Clemens
- Department of International Health, CAPHRI School for Public Health and Primary Care, Maastricht University, The Netherlands.
| | - Kai Michelsen
- Department of International Health, CAPHRI School for Public Health and Primary Care, Maastricht University, The Netherlands
| | - Matt Commers
- Department of International Health, CAPHRI School for Public Health and Primary Care, Maastricht University, The Netherlands
| | - Pascal Garel
- European Hospital and Healthcare Federation (HOPE), Brussels, Belgium
| | - Barrie Dowdeswell
- European Centre for Health Assets and Architecture, Utrecht, The Netherlands
| | - Helmut Brand
- Department of International Health, CAPHRI School for Public Health and Primary Care, Maastricht University, The Netherlands
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24
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Neumann PJ, Saret CJ. Is the US "leading from behind" on health policy? THE EUROPEAN JOURNAL OF HEALTH ECONOMICS : HEPAC : HEALTH ECONOMICS IN PREVENTION AND CARE 2014; 15:113-116. [PMID: 24323196 DOI: 10.1007/s10198-013-0548-2] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [MESH Headings] [Track Full Text] [Subscribe] [Scholar Register] [Received: 10/31/2013] [Accepted: 11/21/2013] [Indexed: 06/03/2023]
Affiliation(s)
- Peter J Neumann
- Center for the Evaluation of Value and Risk in Health, Institute for Clinical Research and Health Policy Studies, Tufts Medical Center, 800 Washington Street, Box #063, Boston, MA, 02111, USA,
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25
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Carrera PM. Slow Growth In Health Care Spending. Health Aff (Millwood) 2014; 33:519. [DOI: 10.1377/hlthaff.2014.0078] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/05/2022]
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27
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28
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Meropol NJ. The imperative to address the cost of oncology care. J Natl Cancer Inst 2013; 105:1771-2. [PMID: 24226097 DOI: 10.1093/jnci/djt334] [Citation(s) in RCA: 6] [Impact Index Per Article: 0.5] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 12/29/2022] Open
Affiliation(s)
- Neal J Meropol
- Affiliation of author: University Hospitals Seidman Cancer Center, Case Comprehensive Cancer Center, Case Western Reserve University, Cleveland, OH
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29
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Gordon JE, Leiman JM, Deland EL, Pardes H. Delivering value: provider efforts to improve the quality and reduce the cost of health care. Annu Rev Med 2013; 65:447-58. [PMID: 24111890 DOI: 10.1146/annurev-med-100312-135931] [Citation(s) in RCA: 12] [Impact Index Per Article: 1.0] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/09/2022]
Abstract
Growing concern regarding costs of care and health outcomes in the United States has led to widespread calls to address the issue of health care spending. Today, providers across the country are working both to improve the quality and to reduce the cost of health care. These activities span multiple care delivery settings and include care standardization and redesign, shared decision making, palliative care, care coordination, readmission reduction, patient engagement, predictive modeling, and direct cost reduction. These efforts differ from those undertaken in the past because of the availability of information technology tools to collect and analyze data, and because of the emphasis on cost reduction in conjunction with quality improvement. Although the available literature reflects only a small fraction of the provider activities currently in progress, there is cause for hope for achieving a sustainable, innovative, and value-driven health care system.
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