Pre-fracture individual characteristics associated with high total health care costs after hip fracture.

Older women with pre-fracture slow walk speed, high body mass index, and/or a high level of multimorbidity have significantly higher health care costs after hip fracture compared to those without those characteristics. Studies to investigate if targeted health care interventions for these individuals can reduce hip fracture costs are warranted. INTRODUCTION: The aim of this study is to estimate the associations of individual pre-fracture characteristics with total health care costs after hip fracture, using Study of Osteoporotic Fractures (SOF) cohort data linked to Medicare claims. METHODS: Our study population was 738 women age 70 and older enrolled in Medicare Fee for Service (FFS) who experienced an incident hip fracture between January 1, 1992 and December 31, 2009. We assessed pre-fracture individual characteristics at SOF study visits and estimated costs of hospitalizations, skilled nursing facility and inpatient rehabilitation stays, home health care visits, and outpatient utilization from Medicare FFS claims. We used generalized linear models to estimate the associations of predictor variables with total health care costs (2010 US dollars) after hip fracture. RESULTS: Median total health care costs for 1 year after hip fracture were $35,536 (inter-quartile range $24,830 to $50,903). Multivariable-adjusted total health care costs for 1 year after hip fracture were 14 % higher ($5256, 95 % CI $156 to $10,356) in those with walk speed <0.6 m/s compared to ≥1.0 m/s, 25 % higher ($9601, 95 % CI $3314 to $16,069) in those with body mass index ≥30 kg/m2 compared to 20 to 24.9 mg/kg2, and 21 % higher ($7936, 95 % CI $346 to $15,526) for those with seven or more compared to no comorbid medical conditions. CONCLUSIONS: Pre-fracture poor mobility, obesity, and multiple comorbidities are associated with higher total health care costs after hip fracture in older women. Studies to investigate if targeted health care interventions for these individuals can reduce the costs of hip fractures are warranted.

Association of medication attitudes with non-persistence and non-compliance with medication to prevent fractures.

UNLABELLED: Our objective was to assess the association of self-reported non-persistence (stopping fracture-prevention medication for more than 1 month) and self-reported non-compliance (missing doses of prescribed medication) with perceived need for fracture-prevention medication, concerns regarding long-term harm from and/or dependence upon medications, and medication-use self-efficacy (confidence in one's ability to successfully take medication in the context of their daily life). INTRODUCTION: Non-persistence (stopping medication prematurely) and non-compliance (not taking medications at the prescribed times) with oral medications to prevent osteoporotic fractures is widespread and attenuates their fracture reduction benefit. METHODS: Cross-sectional survey and medical record review of 729 patients at a large multispecialty clinic in the United States prescribed an oral bisphosphonate between January 1, 2006 and March 31, 2007. RESULTS: Low perceived necessity for fracture-prevention medication was strongly associated with non-persistence independent of other predictors, but not with non-compliance. Concerns about medications were associated with non-persistence, but not with non-compliance. Low medication-use self-efficacy was associated with non-persistence and non-compliance. CONCLUSIONS: Non-persistence and non-compliance with oral bisphosphonate medication have different, albeit overlapping, sets of predictors. Low perceived necessity of fracture-prevention medication, high concerns about long-term safety of and dependence upon medication , and low medication-use self-efficacy all predict non-persistence with oral bisphosphonates, whereas low medication-use self-efficacy strongly predicts non-compliance with oral bisphosphonate medication. Assessment of and influence of these medication attitudes among patients at high risk of fracture are likely necessary to achieve better persistence and compliance with fracture-prevention therapies.

Disenrollment from Medicare HMOs.

BACKGROUND: Since the program's inception, there has been great interest in determining whether beneficiaries who enter and subsequently leave Medicare health maintenance organizations (HMOs) are more or less costly than those remaining in fee-for-service (FFS) Medicare. OBJECTIVES: To examine whether relatively high-cost beneficiaries disenroll from Medicare HMOs (disenrollment bias) and whether disenrollment bias varies by Medicare HMO market characteristics. In addition, we compare rates of surgical procedures and hospitalizations for ambulatory care-sensitive conditions for disenrollees and continuing FFS beneficiaries. DESIGN: Cross-sectional analysis of 1994 Medicare data. PARTICIPANTS AND METHODS: Medicare beneficiaries were first sampled from the 124 counties with at least 1000 Medicare HMO enrollees. From this pool, HMO disenrollees and a sample of continuing FFS beneficiaries were drawn. The FFS beneficiaries were assigned dates of "pseudodisenrollment." Expenditures and inpatient service use were compared for 6 months after disenrollment or pseudodisenrollment. RESULTS: The HMO disenrollees were no more likely than the continuing FFS beneficiaries to have positive total expenditures (Part A plus Part B) or Part B expenditures in the first 6 months after disenrollment. However, disenrollees were more likely to have Part A expenditures. Among beneficiaries with spending, disenrollees had higher total and Part B expenditures than continuing FFS beneficiaries. Moreover, the disparity in total and Part B spending between disenrollees and continuing FFS beneficiaries increased with HMO market penetration. Although Part A spending was higher for disenrollees with spending, it was not sensitive to changes in market share. The HMO disenrollees received more surgical procedures and were hospitalized for more of the ambulatory care-sensitive conditions than the FFS beneficiaries. CONCLUSIONS: On several measures, Medicare HMOs experienced favorable disenrollment relative to continuing FFS beneficiaries as recently as 1994, which increased as HMO market share increased.

Premium rebates and the quiet consensus on market reform for Medicare.

Premium rebates allow beneficiaries who choose more efficient Medicare options to receive cash rebates, rather than extra benefits. That simple idea has been controversial. Without fanfare, however, premium rebates have become a key area of agreement in the debate on Medicare reform. Moreover, in legislation in late 2000, it became official policy: Medicare+Choice (M+C) plans will be allowed to offer rebates beginning in 2003. This article explores the economic rationale for premium rebates, provides a historical perspective on the rebate debate, discusses some of the implementation issues that need to be addressed before 2003, and reviews the implications of premium rebates for current legislative proposals for Medicare reform.

A demand-side view of risk adjustment.

This paper analyzes the efficient allocation of consumers to health plans. Specifically, we address the question of why employers that offer multiple health plans often make larger contributions to the premiums of the high-cost plans. Our perspective is that the subsidy for high-cost plans represents a form of demand-side risk adjustment that improves efficiency. Without such subsidies (and in the absence of formal risk adjustment), too few employees would choose the high-cost plans preferred by high-risk workers. We test the theory by estimating a model of the employer premium subsidy, using data from a survey of large public employers in 1994. Our empirical analysis shows that employers are more likely to subsidize high-cost plans when the benefits of risk adjustment are greater. The findings suggest that the premium subsidy can accomplish some of the benefits of formal risk adjustment.

The effects of medical group practice and physician payment methods on costs of care.

OBJECTIVE: To assess the effects of payment methods on the costs of care in medical group practices. DATA SOURCES: Eighty-six clinics providing services for a Blue Cross managed care program during 1995. The clinics were analyzed to determine the relationship between payment methods and cost of care. Cost and patient data were obtained from Blue Cross records, and medical group practice clinic data were obtained by a survey of those organizations. STUDY DESIGN: The effects of clinic and physician payment methods on per member per year (PMPY) adjusted patient costs are evaluated using a two-stage regression model. Patient costs are adjusted for differences in payment schedules; patient age, gender, and ACG; clinic organizational variables are included as explanatory variables. DATA COLLECTION: Patient cost data were extracted from Blue Cross claims files, and patient and physician data from their enrollee and provider data banks. Medical group practice data were obtained by a mailed survey with telephone follow-up. PRINCIPAL FINDINGS: Capitation payment is correlated with lower patient care costs. When combined with fee-for-service with withhold provisions, this effect is smaller indicating that these two clinic payment methods are not interchangeable. Clinics with more physician compensation based on measures of resource use or based on some share of the net revenue of the clinic have lower patient care costs than those with more compensation related to productivity or based on salary. Salary compensation is strongly associated with higher costs. The use of physician profiles and clinical guidelines is associated with lower costs, but referral management systems have no such effect. The lower cost clinics are the smaller, multispecialty clinics. CONCLUSIONS: This study indicates that payment methods at both the medical group practice and physician levels influence the cost of care. However, the methods by which that influence is manifest is not clear. Although the organizational structure of clinics and their use of managed care programs appear to play a role, this influence is less than expected.

How do states buy health insurance for their own employees?

State governments play many roles in local health insurance markets. This paper focuses on the role of states as employers. As managed care and health care costs continue to grow, state governments engage in a variety of health insurance purchasing practices that influence the structure of health benefits offered to state employees. Descriptive analysis shows that many states have adopted managed competition to some degree, as well as traditional cost-reducing measures such as utilization review and self insurance. The experience of state governments can provide a benchmark for other public and private employers.

Which types of hospital mergers save consumers money?

This study analyzes the changes in costs and prices from 1986 to 1994 for more than 3,500 U.S. short-term general hospitals, including 122 horizontal mergers. These mergers were generally financially beneficial to consumers, providing average price reductions of approximately 7 percent. Merger-related price reductions were considerably less in market areas with higher market concentration levels. Merger-related price reductions in areas with higher penetration by health maintenance organizations (HMOs) were approximately twice those in areas with lower HMO penetration. Merger-related price reductions were greater for low-occupancy hospitals, nonteaching hospitals, nonsystem hospitals, similar-size hospitals, and hospitals with greater premerger service duplication.

The Clinton health care reform proposal: efficiency, fairness, and the role of government.

In a detailed evaluation of the Clinton reform proposal, this article deals with the many thorny yet pragmatic problems concerning the proper role of government in reforming the health care system. Areas of focus include mandatory coverage, information networks, market failure, and the ability of government-controlled systems to produce efficiency and fairness for the health care consumer. It is the author's opinion that the plan needs to be resubmitted with substantial revisions.

From data to policy ... to politics. The Minnesotans health care plan for universal access to care.

Calls for major reform of the health care delivery system have been sounded at both the state and federal level. However, given the lack of consensus on health care reform at a federal level, more than half of the states are developing initiatives for universal access to care. In 1989, the Minnesota legislature created the Health Care Access Commission to develop a blueprint for universal access in Minnesota. To assist this effort, we studied the extent and nature of uninsurance and underinsurance within the state. In this article we report the findings of that study and discuss how the findings were first used to develop recommendations for universal access legislation. We then describe the fate of the legislation. Finally, we describe the veto and the creation of HealthRight, the recently enacted plan for health care reform bill in Minnesota. This plan simultaneously expands access to care and aims to contain health care costs.

Cost function analysis of Medicare policy: are reimbursement limits for rural home health agencies sufficient?

This paper estimates a hybrid total cost function to determine to what extent an urban/rural differential exists in home health agency expenditures in Wisconsin in 1987-1988. We find that costs are over $16 higher per visit in urban Milwaukee than in rural and small MSA counties, providing no evidence that Medicare reimbursement limits should be raised to reflect 'ruralness'. However, the cost of providing skilled nursing care exceeds both urban and rural reimbursement limits. Because rural agencies depend more on Medicare clients and provide disproportionately more skilled nursing visits, this might represent the source of any financial difficulty.

Inpatient length of stay in Twin Cities health plans.

In this paper we examine the relationship between inpatient length of stay and the patient's type of health insurance. The data consist of discharges in seven diagnosis-related groups (DRGs) from community hospitals in Minneapolis and St. Paul during 1982. After controlling for the effects of the patient's age, sex, medical condition, and severity of illness, as well as the hospital's size, teaching and ownership status, and average annual occupancy rate, we must reject the null hypothesis that the patient's type of health plan is unrelated to inpatient length of stay in Twin Cities community hospitals. We find that, in most cases, patients in prepaid group practices and independent practice associations exhibit significantly shorter lengths of stay than similar patients in Blue Cross and commercial health insurance plans, while Medicare and Medicaid patients exhibit significantly longer lengths of stay than those of similar commercially insured patients.

HMOs and Twin Cities admission rates.

From 1977 to 1982, the admission rate in Minneapolis-St. Paul (Twin Cities) has been falling faster than the national average, and faster than the rate in selected comparison metropolitan areas. A natural question regards the impact of Twin Cities HMOs on decreased admission rates. This analysis shows that one's estimate of the HMO effect on total admission rates depends crucially on the estimated "spillover" effect, that is, the effect of HMOs on the non-HMO sector. Using secondary age-adjusted data, the analysis provides estimates of upper and lower bounds on the HMOs' effect on admission rates.

Employer perspectives on the preferred provider organization concept.

The goal of preferred provider organizations (PPOs) is to identify cost effective physicians, hospitals and other providers and form them into healthcare delivery systems. Widespread interest in PPOs stems from the belief that they can contain costs while offering consumers a choice of physicians and hospitals. But there is little information available about the demand by employers to offer PPOs as a health plan option. This study gathered information on employers' attitudes toward PPOs through a survey of companies in the Minneapolis metropolitan area. Most of the surveyed firms were found to be self-insured and offered a choice of healthcare plans, including HMOs. Contrary to some previous studies, healthcare costs are a major concern by all of the firms. PPOs are viewed as one part of an overall strategy to reduce those costs while maintaining quality of care and convenient access to providers. Although somewhat skeptical about potential savings and concerned over the administrative costs of offering a new health plan, most of the firms indicated support for the PPO concept. The greatest market opportunity for PPOs is to offer the plan as an alternative within the company's existing indemnity plan, wherein employees who use the preferred providers are exempt from at least a portion of the coinsurance and deductible requirements.

Methodological limitations in case mix hospital reimbursement, with a proposal for change.

We have found five methodological limitations in the creation and implementation of the diagnosis related group (DRG) patient classification system, which is used to define a hospital's case mix. There are four methodological limitations in the system that Klastorin and Watts have proposed to identify hospital peer groups. We conclude that the effects of these limitations should be sought, and we propose studies to measure their extent. We also propose that these two approaches can be combined to create an improved hospital reimbursement program that accurately measures differences between hospitals caused by case mix and peer group characteristics.

Simulation of a health insurance market with adverse selection.

A health insurance market is examined in which individuals with a history of high utilization of health care services tend to select fee-for-service (FFS) insurance when offered a choice between FFS and health maintenance organizations (HMOs). In addition, HMOs are assumed to practice community rating of employee groups. Based on these observations and health plan enrollment and premium data from Minneapolis-St. Paul, a deterministic simulation model is constructed to predict equilibrium market shares and premiums for HMO and FFS insurers within a firm. Despite the fact that favorable selection enhances their ability to compete with FFS insurers, the model predicts that HMOs maximize profits at less than 100% market share, and at a lower share than they could conceivably capture. That is, HMOs would not find it to their advantage to drive FFS insurers from the market even if they could. In all cases, however, the profit-maximizing HMO premium is greater than the experience-rated premium and, thus, the average health insurance premium per employee in firms offering both HMOs and FFS insurance is predicted to be greater than in firms offering one experience-rated plan. The model may be used to simulate the effects of varying the employer's method of contributing to health insurance premiums. Several contribution methods are compared. Employers who offer FFS and HMO insurance and pay the full cost of the lowest-cost plan are predicted to have lower average total premiums (employer plus employee contributions) than employers who pay any level percent of the cost of each plan.