The impact of BPO on cost reduction in mid-sized health care systems

At the convergence of two politico-economic "hot topics" of the day--outsourcing and the cost of health care-lie opportunities for mid-sized health systems to innovate, collaborate, and reduce overhead. Competition in the retail health care market can serve as both an impetus and an inhibitor to such measures, though. Here we are going to address the motivations, influences, opportunities, and limitations facing mid-sized, US non-profit health systems in business process outsourcing (BPO). Advocates cite numerous benefits to BPO, particularly in cost reduction and strategy optimization. BPO can elicit cost savings due to specialization among provider firms, returns to scale and technology, standardization and automation, and gains in resource arbitrage (off-shoring capabilities). BPO can also free an organization of non-critical tasks and focus resources on core competencies (treating patients). The surge in BPO utilization has rarely extended to the back-office functions of many mid-sized health systems. Health care providers, still a largely fragmented bunch with many rural, independent non-profit systems, have not experienced the consolidation and organizational scale growth to make BPO as attractive as other industries. Smaller firms, spurning merger and acquisition pressure from large, tertiary health systems, often wish to retain their autonomy and identity; hence, they face a competitive cost disadvantage compared to their larger competitors. This article examines the functional areas for these health systems in which BPO is not currently utilized and dissects the various methods available in which to practice BPO. We assess the ongoing adoption of BPO in these areas as well as the barriers to adoption, and identify the key processes that best represent opportunity for success. An emphasis is placed on a collaborative model with other health systems compared to a single system, unilateral BPO arrangement.     

Analysing health care systems performance: the story behind the statistics

This commentary paper argues that the Asia-Pacific region would benefit from a home-grown version of the European Observatory on Health Care Systems to inform health sector policy: an Asia-Pacific Observatory. The countries in this diverse region, ranging from highly developed to very poor countries, are undergoing dramatic and diverse health sector changes, often on the basis of little evidence and with little information on successes and failures in neighbouring countries. The international community also is interested in knowing more about the many distinctive models of Asia-Pacific health care. While statistical comparisons are important, health policymakers and researchers need to understand the story behind the statistics in order to interpret the numbers and to formulate policies and strategies. Health system profiles therefore are useful instruments that describe how a complex health sector works, offer a comparative framework for cross-national comparisons, identify trends in health system design, and with standardised measures and regular updates measure progress against benchmarks. These reports and expanded analyses have influenced both national and Europe-wide debates on health policy. In the Asia-Pacific region, health systems research has built up a critical mass of studies and people with strong links across countries. The next ambitious steps are to identify sponsors able to support an enterprise that transcends national boundaries and to begin a project of comparative studies of national health systems.     

The health care systems of China and India: performance and future challenges

Both China and India have recently committed to injecting new public funds into health care. Both countries are now deciding how best to channel the additional funds to produce benefits for their populations. In this paper we analyze how well the health care systems of China and India have performed and what determines their performance. Based on the analysis, we suggest that money alone, channeled through insurance and infrastructure strengthening, is inadequate to address the current problems of unaffordable health care and heavy financial risk, and the future challenges posed by aging populations that are increasingly affected by noncommunicable diseases.     

The impact of DRG-based payment systems on quality of health care in OECD countries

Ever since DRG-based payment systems were first introduced in the United States in 1983, the medical community has expressed concern about the potential impact of these price control systems on the quality of care. Several research studies have examined the impact of DRG-based payment systems on the quality of care within a single state in the United States, or within a specific country. We have not identified any attempts in the literature to examine the impact of DRG-based payment systems on the quality of health care across different countries. In this article we contribute to the debate by (1) providing a unique identification of DRG adoption status for each of 35 countries, (2) refining an international case mix index, and (3) applying it to examine whether DRG-based payments impact the quality of health care across national and cultural boundaries. We find some evidence for Organization for Economic Cooperation and Development countries that, compared with non-adopters, adoption of DRG-based payment systems is associated with faster hospital case mix increases and slower quality gains with respect to patient mortality from surgical and medical misadventures.     

The impact of DRGs on the health care industry

The impact of Medicare's prospective payment system on hospitals and home care agencies includes significant changes in patient and service mix and quantity as well as rapid entrance of hospitals and proprietary organizations into the home care industry. As a result, many opportunities and challenges confront hospitals and other health care providers.     

The impact of diagnosis related groups and prospective pricing systems on health care management

Prospective pricing systems for medical care based on diagnosis related groups will probably become the norm for the entire medical care industry. Such an approach will have an impact on health care managers' roles, and it is up to them to achieve an optimistic outcome from implementation of the system.     

The 1990-91 recession: impact on health care

The Persian Gulf war is over. The U.S. economy is experiencing some signs of relief from the recession. However, it's too soon for health care executives to forget these events. Their effects on health care will be felt for some time to come.     

The impact of health care provider market served on health care channel relationships

A conceptual framework is provided in which manufacturer-wholesaler relationships are addressed in the context of the health care provider segment served by the wholesaler. A study of the medical supply channel demonstrates how the particular market served by the wholesaler shapes the manufacturer-wholesaler relationship along the behavioral dimensions of manifest conflict, coercion, satisfaction and openness of communications. The health care provider segment served was found to have a significant impact on these dimensions. The results of this research suggest that channel member strategies, policies and operating procedures must account for variations in input (supply) and output (market) environments.     

The impact of a maternal and child health care program on the quality of prenatal care

A typical maternal and child health care program was implemented in an American Indian reservation community, and its impact on the effectiveness of prenatal care was assessed. Evaluation included examination from both the provider perspective (care provided to program users) and the population perspective (care received by a sample of all prenatal patients in the community), as well as examination of outcomes of prenatal care. The study cohorts were sorted into relatively high and average risk as a function of age, gravidity, and history of abortion or miscarriage. The study results suggest that such a program will improve the quality of prenatal care, although the program has a greater impact on the average risk group. Standard methods of assessing program effectiveness, which examine the care provided by the program as opposed to the care received by the community, will not detect this phenomenon.     

The changing world of HIV care: The impact on health professionals

Recent advances in treatment have improved the health of many people living with HIV/AIDS. The research described in this paper shows that the changing context of care is also impacting significantly on people who provide services. In this paper, we explore both perspectives by comparing recent service provider data with that derived from research involving people living with HIV/AIDS. We explore four themes: (1) hope and optimism; (2) changing context, roles and identities; (3) changing relationships; and (4) quality of life. Treatment advances and a new focus on living has altered the context of working with people living with HIV/AIDS and challenges health professionals to find new meanings and relationships within that context. Study findings have implications for the wider health care context and the changing roles and power balances within this arena.     

The impact of financial incentives on health and health care: Evidence from a large wellness program

Workplace wellness programs have become increasingly common in the United States, although there is not yet consensus regarding the ability of such programs to improve employees' health and reduce health care costs. In this paper, we study a program offered by a large U.S. employer that provides substantial financial incentives directly tied to employees' health. The program has a high participation rate among eligible employees, around 80%, and we analyze the data on the first 4 years of the program, linked to health care claims. We document robust improvements in employee health and a correlation between certain health improvements and reductions in health care cost. Despite the latter association, we cannot find direct evidence causally linking program participation to reduced health care costs, although it seems plausible that such a relationship will arise over longer horizons.     

The influence of health care organisations on health system performance

OBJECTIVES: The governments of many countries are undertaking initiatives to assess the extent to which health care organisations fulfil important objectives of health care, such as health improvement, fair access and efficiency. However, the extent to which these health care organisations can influence these objectives is unclear. The purpose of this study is to examine the potential influence of English National Health Service territorial health authorities on 14 indicators of system performance. METHODS: The study uses performance data relating to approximately 5000 small geographical areas with average populations of 10,000. Multi-level statistical models are used to attribute variation in the indicators to three hierarchical levels--small areas, district health authorities and regional health authorities--after controlling for socio-demographic characteristics. Variations in indicators attributable to district or regional level give an indication of the extent to which health authorities may influence performance. RESULTS: After adjusting for socio-demographic characteristics, the proportion of variation in performance attributable to district health authorities varies from about 8% (for standardised mortality ratios) to about 76% (for waiting time for elective surgery). Variation at the regional level is smaller than at the district level. CONCLUSIONS: There appear to be very large variations between indicators in the extent to which health care organisations can influence health system performance. Choice of performance indicators and the managerial incentive regime based on the indicators should recognise this variability, as it is highly dysfunctional to hold managers accountable for measures of performance that are beyond their control.