Testing the myth of fee‐for‐service and overprovision in health care

Paying on the basis of fee‐for‐service (FFS) is often associated with a risk of overprovision. Policymakers are therefore increasingly looking to other payment schemes to ensure a more efficient delivery of health care. This study tests whether context plays a role for overprovision under FFS. Using a laboratory experiment involving medical students, we test the extent of overprovision under FFS when the subjects face different fee sizes, patient types, and market conditions. We observe that decreasing the fee size has an effect on overprovision under both market conditions. We also observe that patients who are harmed by excess treatment are at little risk of overprovision. Finally, when subjects face resource constraints but still have an incentive to overprovide high‐profit services, they hesitate to do so, implying that the presence of opportunity costs in terms of reduced benefits to other patients protects against overprovision. Thus, this study provides evidence that the risk of overprovision under FFS depends on fee sizes, patients' health profiles, and market conditions.     

Supplier‐induced demand for urgent after‐hours primary care services

Australia is one of nine Organisation for Economic Co‐operation and Development (OECD) countries that utilise deputising services to provide after‐hours primary care. While the provision of this service is supposed to be on behalf of regular general practitioners, businesses have adapted to the financial incentives on offer and are directly advertising their services to consumers emphasising patient convenience and no copayments. The introduction of corporate entities has changed the way that deputising services operate. We use a difference‐in‐difference approach to estimate the amount of growth in urgent after‐hours services that was not warranted by urgent medical need. These estimates are calculated by comparing the growth in urgent attendances that occurred during times of the day that are classified as “after‐hours” (e.g., 6 pm–11 pm Monday to Friday) with those that are classified as “unsociable‐hours” (e.g., 11 pm–7 am Monday to Friday). For the national level, we estimate that 593,141 unwarranted attendances were induced as urgent after‐hours consultations in a single year. This corresponds to a national estimate of the total benefits paid for unwarranted demand of approximately $77 million. While deputising services have filled a short‐fall in after‐hours services, the overuse of urgent items has meant that that this has been achieved at a considerable cost to the Australian Government.     

Implementation of altered provider incentives for a more individual‐risk‐based assignment of dental recall intervals: evidence from a health systems reform in Denmark

Equipping health systems with suitable incentives for efficient resource allocation remains a major health policy challenge. This study examines the impacts of 2015 regulatory changes in Danish dental care which aimed at effectuating a transition from six‐to‐twelve‐monthly dental recall intervals, for every patient, towards a model where patients with higher need receive dental recalls systematically more frequently than patients with lower need. Exploiting administrative data from the years 2012‐2016 from the Danish National Health Insurance database containing 72,155,539 treatment claims for 3,759,721 unique patients, we estimated a series of interrupted time‐series regression models with patient‐level fixed‐effects. In comparison to the pre‐reform period, the proportion of patients with recall intervals of up to 6 months was by 1.2%‐points larger post‐implementation; that of patients with 6‐12‐monthly recalls increased by 0.7%‐points; that of patients with more than 12‐monthly dental recalls decreased by 1.9%‐points. The composition of care shifted more substantially: the proportion of treatment sessions including preventive care increased by 31.5%‐points (95%‐CI: 31.4;31.6); that of sessions including scaling increased by 24.1%‐points (24.0;24.2); that of sessions including diagnostics decreased by 34.5%‐points (34.4;34.6). These findings suggest that dental care providers may have responded differently to regulatory changes than intended by the health policy.     

Monetising the provision of informal long‐term care by elderly people: estimates for European out‐of‐home caregivers based on the well‐being valuation method

Providing informal care can be both a burden and a source of satisfaction. To understand the welfare effect on caregivers, we need an estimate of the ‘shadow value’ of informal care, an imputed value for the non‐market activity. We use data from the 2006–2007 Survey of Health Ageing and Retirement in Europe which offers the needed details on 29,471 individuals in Austria, Belgium, the Czech Republic, Denmark, France, Germany, Italy, the Netherlands, Poland, Spain, Sweden and Switzerland. Of these, 9768 are unpaid non‐co‐resident caregivers. To estimate net costs, we follow the subjective well‐being valuation method, modelling respondents' life satisfaction as a product of informal care provision, income and personal characteristics, then expressing the relation between satisfaction and care as a monetary amount. We estimate a positive net effect of providing mode rate amounts of informal care, equivalent to €93 for an hour of care/week provided by a caregiver at the median income. The net effect appears to turn negative for greater high care burdens (over 30 hours/week). Interestingly, the effects of differences in care situation are at least an order of magnitude larger. We find that carers providing personal care are significantly more satisfied than those primarily giving help with housework, a difference equivalent to €811 a year at the median income. The article makes two unique contributions to knowledge. The first is its quantifying a net benefit to moderately time‐intensive out‐of‐home caregivers. The second is its clear demonstration of the importance of heterogeneity of care burden on different subgroups. Care‐giving context and specific activities matter greatly, pointing to the need for further work on targeting interventions at those caregivers most in need of them.     

Effects of Geographical Accessibility on the Use of Outpatient Care Services: Quasi‐Experimental Evidence from Panel Count Data

In 2010–2012, new outpatient service locations were established in Hungarian micro‐regions, which had lacked such capacities before. We exploit this quasi‐experiment to estimate the effect of geographical accessibility on outpatient case numbers using both individual‐level and semi‐aggregate panel data. We find a 24–27 per cent increase of case numbers as a result of the establishments. Our specialty‐by‐specialty estimates imply that a 1‐min reduction of travel time to the nearest outpatient unit increases case numbers for example by 0.9 per cent in internal care and 3.1 per cent in rheumatology. The size of the new outpatient capacities has a separate effect, raising the possibility of the presence of supplier‐induced demand. By combining a fixed‐effects logit and a fixed‐effects truncated Poisson estimator, we decompose the effects into increases in the probability of ever visiting a doctor on the one hand and an increase of the frequency of visits on the other hand. We find that new visits were dominant in the vast majority of specialties, whereas both margins were important for example in rheumatology. Finally, we demonstrate the usefulness of the fixed‐effects truncated Poisson estimator in modelling count data by examining its robustness by simulations. Copyright © 2015 John Wiley & Sons, Ltd.     

The Influence of Cost‐Effectiveness and Other Factors on Nice Decisions

The National Institute for Health and Care Excellence (NICE) emphasises that cost‐effectiveness is not the only consideration in health technology appraisal and is increasingly explicit about other factors considered relevant but not the weight attached to each. The objective of this study is to investigate the influence of cost‐effectiveness and other factors on NICE decisions and whether NICE's decision‐making has changed over time. We model NICE's decisions as binary choices for or against a health care technology in a specific patient group. Independent variables comprised of the following: clinical and economic evidence; characteristics of patients, disease or treatment; and contextual factors potentially affecting decision‐making. Data on all NICE decisions published by December 2011 were obtained from HTAinSite [ www.htainsite.com ]. Cost‐effectiveness alone correctly predicted 82% of decisions; few other variables were significant and alternative model specifications had similar performance. There was no evidence that the threshold has changed significantly over time. The model with highest prediction accuracy suggested that technologies costing £40 000 per quality‐adjusted life‐year (QALY) have a 50% chance of NICE rejection (75% at £52 000/QALY; 25% at £27 000/QALY). Past NICE decisions appear to have been based on a higher threshold than £20 000–£30 000/QALY. However, this may reflect consideration of other factors that cannot be easily quantified. © 2014 The Authors. Health Economics published by John Wiley & Sons Ltd.     

“We don't do it for the money” … The scale and reasons of poverty‐pay among frontline long‐term care workers in England

Demographic trends escalate the demands for formal long‐term care (LTC) in the majority of the developed world. The LTC workforce is characterised by its very low wages, the actual scale of which is less well known. This article investigates the scale of poverty‐pay in the feminised LTC sector and attempts to understand the perceived reasons behind persisting low wages in the sector. The analysis makes use of large national workforce pay data and a longitudinal survey of care workers, as well as interviews with key stakeholders in the sector. The analysis suggests that there are at least between 10 and 13% of care workers who are effectively being paid under the National Minimum Wage in England. Thematic qualitative analysis of 300 interviews with employers, care workers and service users highlight three key explanatory factors of low pay: the intrinsic nature of LTC work, the value of caring for older people, and marketisation and outsourcing of services.