Global budgets in Maryland: early evidence on revenues, expenses, and margins in regulated and unregulated services

Pricing of hospital services: evidence from a thematic review

The management implications of pricing healthcare services, especially hospitals, have received insufficient scholarly attention. Additionally, disciplinary overlaps have led to scattered academic efforts in this domain. This study performs a thematic synthesis of the literature and applies retrospective analysis to hospital service pricing articles to address these issues. The study's inputs were sourced from well-known online repositories, using a structured search string and PRISMA flow chart to select the pertinent documents. Our thematic analysis of pricing literature encompasses: (a) comprehension of hospital service pricing nature; (b) pricing objectives, strategies and practices differentiation; (c) presentation of factors impacting hospital service pricing. We observe that hospital pricing is an intricate and unclear matter. The terms 'pricing strategies' and 'pricing practices' are often used interchangeably in academic literature. Hospital service pricing is influenced by costs, demand and supply factors, market structure, pricing regulation and third-party reimbursements. The study's findings provide policy implications for service pricing in hospitals, in addition to suggesting avenues for future research on hospital pricing.

Defining Pooled' Place-Based' Budgets for Health and Social Care: A Scoping Review

Introduction

Current descriptions of pooled budgets in the literature pose challenges to good quality evaluation of their contribution to integrated care. Addressing this gap is increasingly important given the shift from early models of integrated care targeting segments of the population, to more recent approaches that aim to target 'places', broader geographically defined populations. This review draws on the current international evidence to describe practical examples of pooled health and social care budgets, highlighting specific place-based approaches.

Methods

We initially conducted a scoping review, a systematic database search ('Medline', 'Embase', 'Econ Lit' and 'Google Scholar') complemented by further snowballing for academic and 'grey literature' publications (1995 - 2020). Results were analysed thematically according to budget characteristics and macro-environment, with additional specific case studies.

Results

Thirty-six primary studies were included, describing ten broad models of pooled budgets across seven countries. Most budgets targeted specific sub-populations rather than an entire geographically defined population. Specific budget structures varied and were generally under-described. The closest place-based models were for small populations and implemented in a national health system, or insurance-based with natural geographical boundaries.

Conclusion

Despite their increasing relevance in the current political debate, pooled place-based budgets are still at an early stage of implementation and research. Adequate description is required for future meta-analysis of effectiveness on outcomes.

Health Care Leaders' Perspectives on the Maryland All-Payer Model

IMPORTANCE

Since 2014, all hospitals in Maryland have operated under an all-payer global budget system. Hospital global budgets have gained renewed attention as a strategy for constraining cost growth, improving patient outcomes, and preserving health care access in rural and underserved communities. Lessons from the implementation of the Maryland All-Payer Model (MDAPM) may have implications for policy makers, payers, and hospitals in other settings seeking to adopt global budgets or other value-based payment models.

OBJECTIVE

To examine perspectives on the implementation of the MDAPM among health care leaders who participated in its design and execution.

DESIGN SETTING AND PARTICIPANTS

This qualitative study with semistructured telephone interviews was conducted from November 1, 2019, to February 11, 2020. The purposive sample of Maryland health care leaders represents diverse stakeholder groups, including hospitals, state government and regulatory agencies, the federal government, and payers.

MAIN OUTCOMES AND MEASURES

Key high-level themes were extracted from interviews using qualitative content analysis, with barriers and facilitators to implementation specified within each theme.

RESULTS

A total of 20 interviews were conducted with hospital leaders (n = 6), state regulators (n = 4), federal regulators (n = 4), payer representatives (n = 3), and state leaders (n = 3). Key themes were labeled as (1) expectations (setting bold yet achievable goals), (2) autonomy (allowing hospitals to follow individual strategies within MDAPM parameters), (3) communication (encouraging early and ongoing communication between stakeholders), (4) actionable data (sharing useful hospital and patient-level data between stakeholders), (5) global budget calibration (anticipating technical challenges when negotiating budgets for individual hospitals), and (6) shared commitment to change (harnessing collective motivation for system change). Together, these themes suggest that implementing the payment model followed an evolving and collaborative process that requires stakeholder communication, data to guide decisions, and commitment to operating within the new payment system.

CONCLUSIONS AND RELEVANCE

The implementation of hospital global budgets in the state of Maryland offers generalizable lessons that can inform the evolution and expansion of this approach to value-based payment in other states and settings.

The Rise of Obesity among Total Knee Arthroplasty Patients

In the United States, one-third of adults are considered obese, and demand for total knee arthroplasty (TKA) is expected to rise in these patients. Surgeons are reluctant to operate on obese patients, but it is important to understand how obesity has affected TKA utilization. This study utilizes a national database to evaluate incidence, demographics, outcomes, charges, and cost in nonobese, overweight, nonmorbidly obese, and morbidly obese TKA patients. We queried the National Inpatient Sample from 2009 to 2016 for primary TKA patients identifying 4,053,037 nonobese patients, 40,077 overweight patients, 809,649 nonmorbidly obese patients, and 428,647 morbidly obese patients. Chi-square was used to analyze categorical variables, and one-way analysis of variance was used to analyze continuous variables. Nonmorbidly obese and morbidly obese patients represented 23.2% of all TKAs. TKA utilization increased 4.1% for nonobese patients, 121.6% for overweight patients, 73.6% for nonmorbidly obese patients, and 83.9% for morbidly obese patients. Morbidly obese patients were younger (p < 0.001), female (p < 0.001), Black (p < 0.001), poor (p < 0.001), and utilized private insurance (p < 0.001). They also had the longest length of stay (p < 0.001) and the highest mortality rate (p < 0.001). More morbidly obese patients were discharged to other facilities (p < 0.001), and they had the highest rate of complications (p < 0.001). Patients with morbid obesity had the highest charges (p < 0.001), but overweight patients had the highest costs (p < 0.001). The results of this study demonstrate the rise in obese and morbidly obese patients seeking TKAs, which may be reflection of the obesity epidemic in America. Although TKA utilization has increased for morbidly obese patients, this body mass index (BMI) category also has the highest rates of charges and complications, suggesting morbid obesity to be a modifiable risk factor leading to worse surgical and economic outcomes. Obese patients undergoing TKA may benefit from preoperative optimization of their weight, in an effort to reduce the risk of adverse outcomes.

Impact of Global Budget Payments on Cardiovascular Care in Maryland: An Interrupted Time Series Analysis

Background Global budget payments (GBP) are considered effective in containing health care expenditures; however, information on their impact on quality of cardiovascular care is limited. We aimed to evaluate the effects of GBP on utilization, outcomes, and costs for 3 major cardiovascular conditions. Methods We analyzed claims data of hospital admissions in Maryland from fiscal year 2013 to 2018. Using segmented regression, we evaluated temporal trends in hospitalizations, length of stay, percutaneous coronary intervention and coronary artery bypass grafting volumes, case mix-adjusted 30-day readmission rates, risk-standardized mortality rates, and hospitalization charges in patients with principal diagnosis of heart failure, acute ischemic stroke, and acute myocardial infarction (AMI) in relation to GBP implementation. Trends in global cardiovascular procedure charges/volumes were also studied. Results Hospitalization rates for congestive heart failure and AMI remained unaffected by GBP, while the gradient of ischemic stroke admissions decreased (P_trend <0.0001). Length of stay slightly increased for patients with congestive heart failure (P_trend=0.03). Inpatient coronary artery bypass grafting surgeries decreased (P_trend <0.0001). We observed a significant decrease in casemix-adjusted 30-day readmission rate in the AMI cohort beyond the prepolicy trend (P_trend=0.0069). There were no significant changes in mortality for any of the 3 conditions. Hospitalization charges increased for ischemic stroke (P_trend <0.0001), remained constant for congestive heart failure (P_trend=0.1), and decreased for AMI (P_trend=0.0005). We observed a significant increase in electrocardiography rate charges (P_trend <0.0001), coincidentally with a reduction in volumes (P_trend=0.0003). Conclusions Introducing GBP in Maryland had no perceivable adverse effects on inpatient outcomes and quality indicators for 3 major cardiovascular conditions. Savings were observed in the AMI cohort, possibly due to reduced unnecessary readmissions, efficiency improvements, or shifts to outpatient care. Reduced cardiovascular procedure volumes were counterbalanced by a proportional rise in charges. State-level adoption of GBP with pay-for-performance incentives may be effective for cost containment without adversely impacting quality of cardiovascular care.

The impact of Maryland's payment reforms on hospital community benefit efforts

BACKGROUND

In 2014, Maryland established a global budget policy for all hospitals in the state. Under this policy, hospitals are incentivized to not only provide clinical care services to individual patients but also address the health needs of their broader patient population through prevention efforts and investment in the upstream social and economic factors that determine health.

PURPOSE

To better understand the incentives created for hospitals under this policy, our study assessed whether the implementation of global budgets changed the levels and patterns of Maryland hospitals' investments in community benefits.

APPROACH

Data on hospital community benefit spending from the Internal Revenue Service Form 990 Schedule H for the years 2010-2016 were utilized for this study.

RESULTS

We found that Maryland hospitals' total spending on community benefits decreased under the global budget policy. Unlike hospitals in similar states without a global budget policy, Maryland hospitals did not experience any increases in Medicaid shortfalls between 2014 and 2016. Although Maryland hospitals provided more subsidized health services, their investment in broader community health improvement activities remained unchanged.

CONCLUSION

Our analysis suggests that Maryland hospitals have shifted strategies because of the implementation of the global budget policy. The ability to report community benefit in a way that accurately considers the context and constraints of a state's policies would provide hospitals better means of communicating these efforts to stakeholders.

PRACTICE IMPLICATIONS

Our results suggest that global budgets impact the levels and patterns of hospitals' community benefit investments.

Maryland's Global Budget Revenue model associated with lower inpatient costs and 30-day readmissions in patients undergoing total hip arthroplasty

BACKGROUND

Maryland implemented the Global Budget Revenue (GBR) to reduce hospital costs, improve quality, and decrease readmissions. Studies assessing its impact on inpatient total hip arthroplasty (THA) procedures are lacking. This study compared before and after GBR changes in 1) patient characteristics; 2) discharge dispositions and lengths of stay (LOS); 3) costs and charges of inpatient stays; and 4) 30-day readmission rates (RR) for THA recipients.

METHODS

The Maryland State Inpatient Database was queried for patients who underwent THA between 2010 and 2016 utilizing the ICD-9 and ICD-10 procedure codes (n = 43,251). Pre- and post-GBR periods were grouped as 2010 to 2013 and 2014 to 2016, respectively. Chi-square analyses were used to analyze patient characteristics. Student's t-tests were utilized to compare ages, LOS, costs, charges, and RR.

RESULTS

There were no differences in the proportion of minorities undergoing THA between the pre- and post-GBR periods (18.3% vs 19.4% African American, 1.2% vs 1.3% Hispanic; P = .056). The number of THA patients with Medicaid insurances increased during post-GBR (4.0% vs 6.7%; P < .001). There was an increased rate of home discharges during post-GBR (33.1% vs 40.9%; P < .001). We found lower LOS (-0.50 days; 95% CI: -0.458 to -0.533; P < .001), mean inpatient costs (-$1417.44; 95% CI -$1143.76 to -$1150.32; P < .001), and mean inpatient charges (-$2196.50; 95% CI: -$1980.10 to -$2412.90; P < .001) during the post-GBR period. There were lower 30-day RR during the post-GBR period (-0.9%; P < .001).

CONCLUSIONS

Our findings suggest favorable preliminary results for patients undergoing THA under the GBR model.

China's new policy for healthcare cost-control based on global budget: a survey of 110 clinicians in hospitals

BACKGROUND

The increasing cost on healthcare exposes China's healthcare budgets and system to financial crisis. To control the excessive growth of healthcare expenditure, China's healthcare reforms emphasize the control of the global budget for healthcare, which leads to the release of relevant policy and a series of cost-control actions implemented by different hospitals. This work aims to identify the effects brought by the cost-control policy and actions via surveying and analysing feedback from clinicians.

METHODS

Questionnaires on the cost-control policy and actions were designed for surveying 110 clinicians in hospitals from different regions of China. The data on the implementation of the cost-control actions and doctors' feedback on these actions were analysed using descriptive statistics. Pearson's chi-squared tests were performed to detect associations between doctors' opinions and specific cost-control actions. A value of p < 0.05 was considered statistically significant. Association relationships between doctors' opinions and cost-control actions were modelled into network models, and key factors were identified in a multi-variate framework. Last, we visualized our resultant data using a network model, and further multi-variate analysis was performed.

RESULTS

There were three main findings. (1) The cost-control policy has been widely implemented in the sampled hospitals in different regions of China, with more than 80% of those surveyed acknowledging that their hospitals take actions of reducing average prescription fees for outpatients, drug costs, and in-hospitalization durations. (2) Most doctors have a negative view of some cost-control actions; this is mainly due to concerns about the effects of these actions on the doctors' own healthcare performance and patient satisfaction. (3) Cost-control actions that had a significant impact on doctors' performance included limiting average prescription fees for outpatients and limiting the use of examinations/drugs/surgeries. Decreased patient satisfaction was associated with fewer admissions of critically ill patients, reduced use of brand-name drugs, and increased total costs to patients due to increased frequencies of visits to the hospitals.

CONCLUSIONS

Cost-control actions implemented in hospitals in response to the government's policy to reduce its national healthcare budget affect both doctors and patients in several ways. Moreover, the cost-control policy and actions can be improved.

China's new policy for healthcare cost-control based on global budget: a survey of 110 clinicians in hospitals

BACKGROUND

The increasing cost on healthcare exposes China's healthcare budgets and system to financial crisis. To control the excessive growth of healthcare expenditure, China's healthcare reforms emphasize the control of the global budget for healthcare, which leads to the release of relevant policy and a series of cost-control actions implemented by different hospitals. This work aims to identify the effects brought by the cost-control policy and actions via surveying and analysing feedback from clinicians.

METHODS

Questionnaires on the cost-control policy and actions were designed for surveying 110 clinicians in hospitals from different regions of China. The data on the implementation of the cost-control actions and doctors' feedback on these actions were analysed using descriptive statistics. Pearson's chi-squared tests were performed to detect associations between doctors' opinions and specific cost-control actions. A value of p < 0.05 was considered statistically significant. Association relationships between doctors' opinions and cost-control actions were modelled into network models, and key factors were identified in a multi-variate framework. Last, we visualized our resultant data using a network model, and further multi-variate analysis was performed.

RESULTS

There were three main findings. (1) The cost-control policy has been widely implemented in the sampled hospitals in different regions of China, with more than 80% of those surveyed acknowledging that their hospitals take actions of reducing average prescription fees for outpatients, drug costs, and in-hospitalization durations. (2) Most doctors have a negative view of some cost-control actions; this is mainly due to concerns about the effects of these actions on the doctors' own healthcare performance and patient satisfaction. (3) Cost-control actions that had a significant impact on doctors' performance included limiting average prescription fees for outpatients and limiting the use of examinations/drugs/surgeries. Decreased patient satisfaction was associated with fewer admissions of critically ill patients, reduced use of brand-name drugs, and increased total costs to patients due to increased frequencies of visits to the hospitals.

CONCLUSIONS

Cost-control actions implemented in hospitals in response to the government's policy to reduce its national healthcare budget affect both doctors and patients in several ways. Moreover, the cost-control policy and actions can be improved.