Affording what's free and paying for choice: comparing the cost of public and private hospitalizations in urban Kerala

OBJECTIVE: To assess the cost of public and private hospitalizations in urban Kerala and discuss policy implications of social disparities in the economic burden of hospital care. METHODS: The NSSO survey on health care (1995-1996) for urban Kerala was analysed with regards to expenditure incurred by hospital episodes. Multilevel linear models were built to assess factors associated with levels of health expenditure. FINDINGS: Hospital care involves paying admission fees in 68% of cases of hospitalizations (98% in private and 20% in public sector) in urban Kerala. Poor households and those headed by casual workers show significantly lower levels of health expenditure and a higher proportion of health-related loss of income than other social groups. Although there is significant expenditure in both sectors for these groups, hospitalization on free public wards is associated with lower expenditure than other options. Factors linked with higher expenditure are: duration of stay; hospitalizations on paying public wards and in the private sector; hospitalizations for above poverty line households and hospitalizations for chronic illnesses. Expenditure for services bought from outside the hospital is important in the public sector. CONCLUSION: Hospitalization incurs significant expenditure in urban Kerala. Greater availability of free medical services in the public sector and financial protection against the cost of hospitalization are warranted.     

Containing mental health treatment costs through program design: a Massachusetts study.

A single site pre-post study of seriously mentally ill patients treated in a public mental health system shows that annual treatment costs can be substantially reduced with the use of day hospital treatment. Two cohorts of psychiatric patients--282 consecutive admissions to a traditional public inpatient unit in 1980, and 340 consecutive admissions to a combination of inpatient and day hospital care in 1984--were followed 12 months after admission. The substitution of the day hospital is made possible because the facility provided a dormitory residence for those who could not go home at night. Cost savings per hospital episode are about 31 per cent when the additional costs of day hospital and residence are considered. Cost shifting from inpatient to residential sites is noted, but overall mean annual costs, when all other treatment (including additional admissions), residential and family costs were included, are reduced. Readmission rates did not rise. The generalizability of the findings is limited to public mental health centers and state hospitals.     

The impact of the introduction of user fees at a district hospital in Cambodia

Proponents of user fees in the health sector in poor countries cite a number of often interrelated rationales, relating inter alia to cost recovery, improved equity and greater efficiency. Opponents argue that dramatic and sustained decreases in service utilization follow the introduction of user fees, highlighting evidence that user fees reduce service utilization when they fail to result in improved quality of care and/or when services are priced higher than those charged by private health care providers. Utilization of public health services in Cambodia is low. Supply-side factors are significant determinants of such low public sector utilization, including low official salaries of service providers (forcing many to seek additional income in the private sector), and operations budgets which are erratic and often insufficient to cover running costs of service delivery outlets. The Cambodia Ministry of Health (MOH) encourages user fee schemes at operational district level. By allowing revenue to be retained at the health facility level, the MOH aims to improve health care delivery--and consequently service utilization--through increased salaries to health facility staff and increases in operations budgets. This case study of the introduction of user fees at a district referral hospital in Kirivong Operational District in Cambodia, using the findings from empirical research, examines the impact of user fees on health-careseeking behaviour, ability to pay and consultation prices at private practitioners. The research showed that consultation fees charged by private providers increased in tandem with price increases introduced at the referral hospital. It further demonstrates--for the first time that we are aware of from the available literature--that the introduction and subsequent increase in user fees created a 'medical poverty trap', which has significant health and livelihood impact (including untreated morbidity and long-term impoverishment). Addressing the medical poverty trap will require two interventions to be implemented immediately: regulation of the private sector, and reimbursing health facilities for services provided to patients who are exempted from paying user fees because of poverty. A third, longer-term initiative is also suggested: the establishment of a social health insurance mechanism.     

The shift from inpatient care to outpatient care in Switzerland since 2017: Policy processes and the role of evidence

The shift from inpatient care to the ambulatory sector is a central aspiration of European health systems. Despite demonstrated benefits, health reforms have struggled to realize their potential. In this context, we discuss recent hospital sector reforms in Switzerland and analyze the content, process, and role of evidence in the recent introduction of policies to substitute inpatient care with ambulatory care. The prevailing payment system incentivized hospitals to provide unnecessary and costly inpatient services, but federal reform on tariff structures was deemed politically unfeasible. Instead, driven by the pressure to contain costs, cantonal and federal health authorities began to deny reimbursement for selected inpatient procedures in 2017. These regulatory measures were effective in reducing inpatient admissions and health care costs. This case study illustrates that clear, simple messages about hospital sector reform can raise awareness of the need for change. However, the evidence used in the policy process was limited and not critically reviewed. Stakeholders used long-standing international comparisons of inpatient substitution potential to legitimize policies, but not to develop them. The analysis restates the importance of inter- and intranational comparative analyses and institutions such as health observatories and suggests aligning health system governance more proactively with international developments.     

Where Do Women Veterans Get Their Inpatient Care?

PURPOSE: In this study we explore women veterans' use of Veterans Administration (VA) and private sector inpatient services. METHODS: Using a comprehensive dataset of VA and private hospital admissions, we identified 1,409 female patients who were enrolled in the VA system and had an inpatient admission between 1998 and 2000 in either the VA or the private sector. For Major Diagnostic Categories (MDCs) with >20 admits in each sector, we compared care provided in the private sector with care provided in the VA with respect to patient characteristics and resource utilization. In addition, we determined payment sources for women who used the private sector for inpatient care. FINDINGS: Women who used the VA were younger (mean, 54 vs. 60 years; p < .001) and more likely to be service connected (39% vs. 24%; p < .001), African American (25% vs. 13%; p < .001), and urban dwelling (81% vs. 75%; p < .01). Women veterans were significantly more reliant on the VA system for mental diseases, alcohol and drug use, and skin/subcutaneous/breast diseases. For every MDC examined, VA hospitals had longer mean lengths of stay. Among VA eligible women <65 years old using the private sector, 56% used private insurance, 15% used Medicare, 14% used Medicaid, and 9% did not have insurance. CONCLUSIONS: In New York, female veterans admitted to VA hospitals differed from women admitted to private hospitals by patient characteristics, admission reason, and admission resource consumption. Many younger women who used the private sector were reliant on other government agencies (Medicaid or Medicare) or out-of-pocket payments for their inpatient care.     

The public and private sectors in health: economic issues

Major changes in the public/private mix of health services are occurring in many countries. These changes may be analysed by examining the financing and provision of services and subsidization of the purchase of the factors of production. The public sector and not-for-profit and for-profit elements of the private sector must be viewed as separate entities in such analyses due to their differing objectives, motives and form of operation. The issues to be dealt with by countries in finding the public/private mix which is appropriate for their health system and achieves their objectives include efficiency, quality, regulation, equity and consumer choice and satisfaction. The recommendations for action for countries include: promoting collaboration between private and public sectors; testing different public/private mix models; identifying appropriate expansion paths for private sector services; improving information for policy and planning decisions; enhancing management capacity; and, reviewing programme and project support. International agencies also have a role in this process by supporting countries through the provision of technical assistance, financial aid, promoting policy reviews, and facilitating the sharing of information and experiences among countries concerning these public/private mix issues.     

Household utilization and expenditure on private and public health services in Vietnam

The private provision of health services in Vietnam was legalized in 1989 as one of the country's means to mobilize resources and improve efficiency in the health system. Ten years after its legalization, the private sector has widely expanded its activities and become an important provider of health services for the Vietnamese people. However, little is known about its contribution to the overall objectives of the health system in Vietnam. This paper assesses the role of the private health care provider by examining utilization patterns and financial burden for households of private, as compared with public, services. We found that the private sector provided 60% of all outpatient contacts in Vietnam. There was no difference by education, sex or place of residence in the use of private ambulatory health care. Although there was evidence suggesting that rich people use private care more than the poor, this finding was not consistent across all income groups. The private sector served young children in particular. Also, people in households with several sick members at the same time relied more on private than public care, while those with severe illnesses tended to use less private care than public. The financial burden for households from private health care services was roughly a half of that imposed by the public providers. Expenditure on drugs accounted for a substantial percentage of household expenditure in general and health care expenditure in particular. These findings call for a prompt recognition of the private sector as a key player in Vietnam's health system. Health system policies should mobilize positive private sector contributions to health system goals where possible and reduce the negative effects of private provision development.     

Comparative quality of private and public health services in rural Vietnam

BACKGROUND: Private health care services were officially recognized in Vietnam in 1989, and for the last 15 years have competed with the public health system in providing primary curative care and pharmaceutical sales to rural populations. However, the quality of these private and public health care services has not been evaluated and compared. METHODS: A community-based survey was conducted in 30 of the 160 communes in Hung Yen, which were selected by probability proportional to population size (PPS) sampling. All commune health centres (CHCs) and private health care providers in the selected communes were surveyed on human resources, services provided, availability of medical equipment and pharmaceuticals, knowledge and clinical performance for acute and chronic problems. Patient satisfaction and cost of care associated with recent illness were measured using a random household survey covering 30 households from each of the selected communes. RESULTS: There were 11.5 private providers per 10,000 population, compared with 6.7 public providers per 10,000. A quarter of private providers were employees of the public health sector. Less than 20% of the private providers had registered their practice with the government system. Eleven per cent (26/234) had no professional qualifications. Fifty-eight per cent (135/234) provided treatment as well as selling medications. Public sector infrastructure was superior to that of the private providers. The quality of services provided by public providers was poor but significantly better than that of private providers. Patient satisfaction and costs of care were similar between the two groups. CONCLUSIONS: Private providers are successfully competing with the public health centre system in rural areas but not because they provide cheaper or better services. The quality of private health care services is not controlled and is significantly poorer than public services. Current practice in both systems falls below the national standard, especially for the management of chronic health problems. The low quality of health care services at a community level may help explain the previously observed phenomena of high levels of self-medicating, low utilization of commune health centres and over-utilization of tertiary health care facilities.     

Comparing the welfare effects of public and private health care subsidies in the United Kingdom

We use a calibrated analytical model to compare the welfare costs (gross of externalities) of increasing subsidies for public and private health care in the UK. The model incorporates wait costs for rationed public care, burdens that subsidies impose on the tax system, and distributional weights for different households. Welfare costs are significantly higher for expanding public health care over a range of parameter scenarios. Both policies reduce average wait times, but for public health care this is offset by new waiting costs incurred on extra treatments. And the burden on the tax system is much larger for expanding public health care.     

Horizontal inequities in Australia's mixed public/private health care system

Recent comparative evidence from OECD countries suggests that Australia's mixed public-private health system does a good job in ensuring high and fairly equal access to doctor, hospital and dental care services. This paper provides some further analysis of the same data from the Australian National Health Survey for 2001 to examine whether the general finding of horizontal equity remains when the full potential of the data is realized. We extend the common core cross-country comparative analysis by expanding the set of indicators used in the procedure of standardizing for health care need differences, by providing a separate analysis for the use for general practitioner and specialist care and by differentiating between admissions as public and private patients. Overall, our analysis confirms that in 2001 Medicare largely did seem to be attaining an equitable distribution of health care access: Australians in need of care did get to see a doctor and to be admitted to a hospital. However, they were not equally likely to see the same doctor and to end up in the same hospital bed. As in other OECD countries, higher income Australians are more likely to consult a specialist, all else equal, while lower income patients are more likely to consult a general practitioner. The unequal distribution of private health insurance coverage by income contributes to the phenomenon that the better-off and the less well-off do not receive the same mix of services. There is a risk that - as in some other OECD countries - the principle of equal access for equal need may be further compromised by the future expansion of the private sector in secondary care services. To the extent that such inequalities in use may translate in inequalities in health outcomes, there may be some reason for concern.     

Health care in China: the role of non-government providers

While China's health services are primarily financed by out-of-pocket spending (private financing), health care providers, especially the hospital industry, are still dominated by state ownership and government control (public provision). Even though the private sector plays an increasing role in the ambulatory sector, private services are not included in the social insurance benefit package, and thus, it primarily serves self-paying patients. The ambiguity of the government policy toward private provision stems from concerns that an increasing private sector would drive up costs and its services may be of questionable quality. This paper tries to gather evidence on the relative performance of private and public sector in China. Neither literature review nor our primary data analysis provides any support for the notion that the private sector charges a higher price and they serve primarily the better-off people. Quite on the contrary, available data seem to suggest that not only the private sector tends to serve disproportionately the low-middle income groups (this may well be due to its relative lower direct and indirect costs), consumer satisfaction also seems to be higher with regards to certain dimensions of the private than public sector.     

Private payers of health care in Brazil: characteristics, costs and coverage

The private sector is the predominant provider of health care in Brazil, particularly for inpatient services, and financing is a mix of public (through a prospective reimbursement system) and private. Roughly a quarter of the population has private insurance coverage, reflecting rapid growth in the past decade fuelled by the crisis in the public reimbursement system and the perceived deterioration of publicly provided care. Four major forms of insurance exist: (1) prepaid group practice; (2) medical cooperatives, physician owned and operated preferred provider organizations; (3) company health plans where employers ensure employee access to services under various types of arrangements from direct provision to purchasing of private services; and (4) health indemnity insurance. Each type of plan includes a wide variety of subplans from basic individual/family coverage to comprehensive executive coverage. The paper discusses the characteristics, costs and utilization patterns of all types of privately financed care, as well as the major problems associated with private financing: the limited package of benefits and low payout ceilings, inadequate consumer information and virtually no regulation.     

Private medicine in socialist China: A survey of the private medical market in Guangzhou

This study analyses the size and the characteristics of the private medical market in Guangzhou. Legislations related to the regulation of private medical establishments are examined. Data collected reveal that private sector provision of health services in China is still small and lacks sophistication. The article recommends further reforms in the fees and charges system; loosening of the restrictions of public doctors to undertake private practice; contracting-out some of the state health services to private practitioners; and, creating a more favourable environment for private investment in the health care industry.     

Factors affecting the choice of health care utilisation between private and public services among the elderly population in India

India is experiencing rapid population ageing in recent years. One of the most concomitant issues is the choice of health care services among the elderly, leading to its impact on the magnitude of health expenditure. Applying Andersen's Health Behavioural Model, this study identifies the predictors of the choice of inpatient health care services among the Indian elderly between private and public services. It also examines the nature of interregional disparity in the choice of health care services. Using NSSO data, the results suggest that the elderly belonging to upper caste and having higher levels of education, higher incomes, larger family size, and needing surgery are likely to choose private health care, while those experiencing higher economic dependence, chronic diseases, and higher duration of hospitalisation tend to prefer public inpatient services. The magnitude and significance of these factors, however, vary across regions. The findings of the study provide an understanding of the preferences of the India's geriatric population over hospital services, which may help policymakers better understand their health care needs.     

Health insurance and private providers: A study of the civil servants' medical benefit scheme in bangkok,Thailand

Compulsory health insurance schemes have received attention recently as a means of creating a reliable extra-budgetary source of health care funding. Yet, the full implications of such schemes in a developing country context are unclear; in particular, the impact on and relationship with private sector providers has infrequently been explored. This study examines patterns of public and private sector utilization under the Civil Servants' Medical Benefit Scheme (CSMBS) in Bangkok, Thailand. The CSMBS currently provides limited reimbursement for private inpatient care, but recent proposals suggest increasing benefit levels for care sought in the private sector. The study shows that despite high level of cost recovery in the public sector, charges were much lower than those in the private sector. Different patterns of diagnosis in the two sectors were found with private hospitals tending to treat a less complex case mix. Within the private sector, there was a limited tendency to specialize in certain types of care. It is concluded that under the current payment mechanism of fee-for-service reimbursement, measures to enhance access to private sector care should be approached with caution. In the long run, the scheme should merge with the recently established social security scheme.     

Evaluation of immunization knowledge, practices, and service-delivery in the private sector in Cambodia

A study of private-sector immunization services was undertaken to assess scope of practice and quality of care and to identify opportunities for the development of models of collaboration between the public and the private health sector. A questionnaire survey was conducted with health providers at 127 private facilities; clinical practices were directly observed; and a policy forum was held for government representatives, private healthcare providers, and international partners. In terms of prevalence of private-sector provision of immunization services, 93% of the private inpatient clinics surveyed provided immunization services. The private sector demonstrated a lack of quality of care and management in terms of health workers' knowledge of immunization schedules, waste and vaccine management practices, and exchange of health information with the public sector. Policy and operational guidelines are required for private-sector immunization practices that address critical subject areas, such as setting of standards, capacity-building, public-sector monitoring, and exchange of health information between the public and the private sector. Such public/private collaborations will keep pace with the trends towards the development of private-sector provision of health services in developing countries.     

Life events and daily hassles and uplifts as predictors of hospitalization and outpatient visitation.

Increased occurrence of major life events and daily "hassles" and "uplifts" have been shown to be associated with several measures of health status and health care utilization. In order to test for such an association with hospital admission, a prospective study was designed. Navajo Indians presenting for either inpatient or outpatient health care at a U.S. Indian Health Service facility were questioned regarding the occurrence of major life events in the preceding six months and of hassles and uplifts in the preceding week. Two years later the subsequent numbers of outpatient visits and of hospital admissions were determined for each subject. An increased number of either major life events (relative risk 1.66) or daily hassles and uplifts (relative risk 1.87) was found to be associated with an increased risk of hospital admission. The effects of major and daily life events were additive on the risk of admission. In addition, hassles were predictive of subsequent outpatient utilization. While further demonstrating the influence of major and daily life occurrences on health care utilization, this study also shows their importance in an additional cultural setting.     

The cost and efficiency of public and private health care facilities in Ogun state,Nigeria

During the 1980s, Nigeria faced difficult economic conditions resulting in a severely constrained budget for public health services. To assess more carefully the costs and efficiency of the public and private health sectors, the Federal Ministry of Health in Nigeria undertook a comprehensive survey of health care facilities in Ogun State in 1987, the analysis of which is presented in this study. The findings suggest that there is potential to increase service delivery within existing budgets by more cost-effective allocation of inputs. Many public and private providers are not operating at full technical capacity. It also appears that public facilities are not using cost-minimizing combinations of high and low-level health workers, in particular, too many low-level staff are being used to support high-level workers. The cost analysis indicates that there are short-run increasing returns to scale for inpatient and nearly constant returns to scale for outpatient services. Economies of scope for joint production of inpatient and outpatient services are not being realized. A major implication of such analysis is that improved resource allocation decisions heavily depend on the existence of information systems at the health facility level which carefully integrate financial information with other appropriate and adequate measures of service inputs, health care quality, facility utilization and ultimately health status.     

Health care plans: interfaces between the public and private system in the dental sector

The present work presents a brief history of health plans in Brazil examining the interface between the public and the private sector. The evolution and regulation of the supplementary care system is analyzed, the different care modalities are defined and the main differences between health plans and dental care insurance are pointed out. The coverage provided by the supplementary care system and its relationship with the public health system is shown on the basis of current data. On the other hand, the study focuses on the care services, health plans and the labor market in the sector correlating, also on the basis of current data, the challenges and new opportunities of the supplementary care market, mainly in the dental sector. Although the dental sector is living an extraordinary moment within the private health care system and given that ANS data are pointing to a growth of this sector of 210% over last the 7 years, the service coverage of the supplementary care sector mainly directed to medical and inpatient care does not meet the real demand for integrated health care.