Incentives in a Medicaid carve-out: impact on children with special health care needs

Objective. To evaluate whether a specialty care payment "carve-out" from Medicaid managed care affects caseloads and expenditures for children with chronic conditions.
Data Source. Paid Medicaid claims in California with service dates between 1994 and 1997 that were authorized by the Title V Children with Special Health Needs program for children under age 21.
Study Design. A natural experiment design evaluated the impact of California's Medicaid managed care expansion during the 1990s, which preserved fee-for-service payment for certain complex medical diagnoses. Outcomes in time series regression include Title V program participation and expenditures. Multiple comparison groups include children in managed care counties who were not mandated to enroll, and children in nonmanaged care counties.
Data Collection/Extraction Methods. Data on the study population were obtained from the state health department claims files and from administrative files on enrollment and managed care participation.
Principal Findings. The carve-out policy increased the number of children receiving Title V-authorized services. Recipients and expenditures for some ambulatory services increased, although overall expenditures (driven by inpatient services) did not increase significantly. Cost intensity per Title V recipient generally declined.
Conclusions. The carve-out policy increased identification of children with special health care needs. The policy may have improved children's access to prevailing standards of care by motivating health plans and providers to identify and refer children to an important national program.     

Economic Evaluation of Atorvastatin for Prevention of Recurrent Stroke Based on the SPARCL Trial

Objectives:  This study evaluated the economic implications of results obtained by the Stroke Prevention by Aggressive Reduction in Cholesterol Levels (SPARCL) trial.
Methods:  To enable long-term projection of the trial results, a discrete event simulation of the course of clinical care after a recent stroke or transient ischemic attack (TIA) was developed. It generates pairs of identical patients; both receive usual care, one receives atorvastatin in addition. Their clinical course is simulated based on their risk of stroke, cardiovascular events, and case fatality rates taken from SPARCL, life expectancy from Saskatchewan Health data, and utility weights from literature. Costs, from a US health-care payer perspective in 2005 US dollars, were estimated for a within-trial 5-year period; survival and quality-adjusted life-years (QALYs) were extrapolated over a patient's lifetime; all discounted at 3%/year.
Results:  The prevention of stroke, coronary, and other cardiovascular events expected with atorvastatin translates to mean gains of 0.155 life-years gained and 0.172 QALYs per patient over their lifetime. Reducing associated medical costs ($8405 vs. $11,237) but increasing drug costs ($13,984 vs. $8752) results in net $2400/patient, or $13,916/QALY gained. Probabilistic sensitivity analysis indicates no simulations yield ratios above $50,000/QALY.
Conclusion:  Prescribing atorvastatin for patients with prior stroke or TIA is expected to provide health benefits at an acceptable cost in the United States.     

The effect of premium changes on SCHIP enrollment duration

Research Objective. To examine the impact of premium changes in Florida's State Children's Health Insurance Program (SCHIP) on enrollment duration.
Data Sources. Administrative records, containing enrollment and demographic data, were used to identify 173,330 enrollment spells for 153,768 children in Florida's SCHIP from July 2002 through June 2004. Health care claims data were used to classify the children's health status.
Study Design. Accelerated failure time models were used to examine the immediate and longer term effects on enrollment length of a temporary premium increase of $15 to $20 per family per month (PFPM) for children in families with income between 101–150 percent of the federal poverty level (FPL) and a permanent premium increase of $15 to $20 PFPM for children in families with 151–200 percent FPL. Health status and sociodemographic variables were included as covariates. Transfers to other public health insurance programs were taken into account.
Principal Findings. Enrollment lengths decreased significantly immediately following the premium increases, with a greater percentage decrease among lower income children (61 percent) than higher income children (55 percent). Enrollment lengths partially recovered in the longer term for both the temporary and permanent changes. Those with significant acute or chronic health conditions had longer enrollment lengths and were less sensitive to premium changes than healthy children.
Conclusions. An increase in the PFPM premium amount had differential effects across income categories and health status levels. Enrollment lengths remained shortened after the premium increase was rescinded for lower income families, suggesting that it may be difficult to reverse the impacts of even a short-term premium increase.     

The impact of payor/provider type on health care use and expenditures among the frail elderly.

OBJECTIVES: This study examined whether health care expenditures and usage by the frail elderly differ under three payor/provider types: Medicare fee for service, Medicare health maintenance organization (HMO), and dual Medicare-Medicaid enrollment. METHODS: In-home interviews were conducted among 450 frail elderly patients of a San Diego, Calif, health care system. Cost and use data were collected from providers. RESULTS: Analyses revealed no difference in total expenditures between fee-for-service and HMO enrollees, but Medicare-Medicaid beneficiaries' expenditures were 46.8% higher than those for HMO enrollees and 52.2% higher than those for the fee-for-service group. Fee-for-service participants were less than half as likely as HMO enrollees to have two or more hospital admissions, but hospital usage rates between those two payor/provider groups did not differ. Not were there payor/provider differences in access to home health care, but HMO home health care users received significantly fewer services than the others. CONCLUSIONS: The care provided to these HMO beneficiaries resulted in a combination of restricted home health use and higher multiple hospitalizations. This raises compelling questions for future research. For the dually enrolled, stronger cost containment may be required.     

Medicaid Managed Care and Health Care for Children

Objective. Many states expanded their Medicaid managed care programs during the 1990s, causing concern about impacts on health care for affected populations. We investigate the relationship between Medicaid managed care enrollment and health care for children.
Data Sources and Measures. Repeated cross-sections of Medicaid-covered children under 18 years of age from the 1996/1997 and 1998/1999 Community Tracking Study Household Surveys ( n =2,602) matched to state-year CMS Medicaid managed care enrollment data. For each individual, we constructed measures of health care utilization (provider and emergency department visits, hospitalizations, surgeries); health care access (usual source of care, unmet medical needs, put-off needed care); and satisfaction (satisfaction overall, with doctor choice, and with last visit).
Study Design. Regression analysis of the relationship between within-state changes in Medicaid managed care enrollment rates and changes in mean utilization, access, and satisfaction measures for children covered by Medicaid, controlling for a range of potentially confounding factors.
Principal Findings. Increases in Medicaid health maintenance organization (HMO) enrollment are associated with less emergency room use, more outpatient visits, fewer hospitalizations, higher rates of reporting having put off care, and lower satisfaction with the most recent visit. Medicaid primary care case management (PCCM) plans are associated with increases in outpatient visits, but also with higher rates of reporting unmet medical needs, putting off care, and having no usual source of care.
Conclusions. Both Medicaid HMO and PCCM plans can have important impacts on health care utilization, access, and satisfaction. Some impacts may be positive (e.g., less ED use and more outpatient provider use), although concern about increasing challenges in access to care and satisfaction is also warranted.     

MHA2 Cost Impact of Using Olanzapine at a Veterans Affairs Medical Center

State Medicaid programs may bear a large portion of the costs of Alzheimer's disease (AD), since they are the major public payers for nursing home care. Recent data on current spending by Medicaid for these patients are not available.
OBJECTIVE: To document Medicaid spending in California for persons with AD.
METHODS: This study was based on enrollment and claims data for a 10% random sample of Medi-Cal recipients 60+ years of age with Medicaid claims in 1995 (N=62,450). Using a prevalence-based cost-of-illness methodology, the cost of AD was estimated as the difference in average annual costs between persons with AD and/or dementia, and an age- and sex-matched comparison cohort. Dementia was included with AD, since the latter is difficult to diagnose, and may be coded more broadly as dementia in an administrative database. Multivariate analyses were undertaken to control for differences in factors other than age and sex, including comorbid conditions.
RESULTS: A total of 2,575 patients with AD and/or dementia were identified, a prevalence of 4.1%. From the 59,875 remaining recipients, 2,575 matched controls were randomly selected. Several comorbid conditions were found to be more common in the group with AD and/or dementia. After adjustment, average annual payments were found to be $7,700 higher for the AD/dementia cohort ($14,500 versus $6,800 for the comparison cohort, p <0.01); 90% of which represented nursing home costs.
CONCLUSIONS: A diagnosis of AD and/or dementia is associated with substantially higher Medicaid expenditures. Annual excess spending for AD and/or dementia for the Medi-Cal program may be as high as $200 million, or 10% of all expenditures for elderly recipients.     

The Impact of Reference Pricing of Nonsteroidal Anti-Inflammatory Agents on the Use and Costs of Analgesic Drugs

Objective. To estimate the effect of reference pricing (RP) of nonsteroidal anti-inflammatory drugs (NSAIDs) on drug subsidy program and beneficiary expenditures on analgesic drugs.
Data Sources/Study Setting. Monthly claims data from Pharmacare, the public drug subsidy program for seniors in British Columbia, Canada, over the period of February 1993 to June 2001.
Study Design. RP limits drug plan reimbursement of interchangeable medicines to a reference price, which is typically equal to the price of the lowest cost interchangeable drug; any cost above that is borne by the patient. Pharmacare introduced two different forms of RP to the NSAIDs, Type 1 in April 1994 and Type 2 in November 1995. Under Type 1 RP, generic and brand versions of the same NSAID are considered interchangeable, whereas under Type 2 RP different NSAIDs are considered interchangeable. We extrapolated average reimbursement per day of NSAID therapy over the months before RP to estimate what expenditures would have been without the policies. These counterfactual predictions were compared with actual values to estimate the impact of the policies; the estimated impacts on reimbursement rates were multiplied by the postpolicy volume of NSAIDS dispensed, which appeared unaffected by the policies, to estimate expenditure changes.
Principal Findings. After Type 2 RP, program expenditures declined by $22.7 million (CAN), or $4 million (CAN), annually cutting expenditure by about half. Most savings accrued from the substitution of low-cost NSAIDs for more costly alternatives. About 20 percent of savings represented expenditures by seniors who elected to pay for partially reimbursed drugs. Type 1 RP produced one-quarter the savings of type 2 RP.
Conclusions. Type 2 RP of NSAIDs achieved its goal of reducing drug expenditures and was more effective than Type 1 RP. The effects of RP on patient health and associated health care costs remain to be investigated.     

Children Who Are Medically Fragile in North Carolina: Using Medicaid Data to Estimate Prevalence and Medical Care Costs in 2004

Objectives: The purpose of this paper is to demonstrate a method of using medical insurance paid claims and enrollment data to estimate the prevalence of selected health conditions in a population and to profile associated medical care costs. The examples presented here use North Carolina Medicaid data to produce estimates for children ages 0–19 who are medically fragile. These children with serious health conditions are a small subset of all children with special health care needs. Methods: The children who are medically fragile were identified through selected procedure and durable medical equipment codes. We profiled the expenditures for all medical services provided to these children during 2004. Results: 1,914 children ages 0–19 enrolled in Medicaid were identified as medically fragile (0.22 percent). The amount paid by Medicaid for these children during 2004 for all medical services was $133.8 million, or $69,906 per child. By comparison, the average expenditure by Medicaid during 2004 for a randomly selected group of children receiving well-child care visits was $3,181 per child. The $133.8 million of Medicaid expenditures for the children who are medically fragile represents 6.8 percent of the nearly $2 billion spent by Medicaid in 2004 for all medical services for all children ages 0–19. Conclusions: This study presents a standard methodology to identify children with specific health conditions and describe their medical care costs. Our example uses Medicaid claims and enrollment data to measure prevalence and costs among children who are medically fragile. This approach could be replicated for other health care payer data bases and also in other geographic areas.     

Research on compliance with diabetic regimens: applications to practice

Compliance with dietary regimens has long been documented as poor. This is of particular interest in diabetic regimens because of the life-long commitment to dietary change necessary to control the disease. The factors and models affecting compliant and non-compliant behavior are discussed. Suggestions are made for the dietitian or health educator on how to improve compliance with diabetic or other dietary regimens.