The end of hospital cost shifting and the quest for hospital productivity

Trends in Pediatric Private Insurance and Medicaid Spending: A Repeated Cross-Sectional Analysis of Data from 2002 to 2014

Given increased focus on health spending, this investigation aims to compare trends in pediatric Medicaid and private insurance spending on type of service from 2002 to 2014 in order to inform policy and research. A repeated cross-sectional analysis of 2002 to 2014 National Health Expenditure Accounts data was conducted. Total spending, per capita spending, and compounded annual growth rates for type of service were determined for children ages 0 to 18 at the national level. Per capita spending growth was higher for private insurance than for Medicaid, and the areas of high per capita spending growth differed for private insurance and Medicaid. While Medicaid spent more per capita on hospital care than private insurance, private insurance demonstrated greater per capita spending growth on hospital care than Medicaid (8.49% vs 1.99%, respectively). Conversely, per capita spending on home health care grew more for Medicaid (6.79%) than for private insurance (3.18%). Trends in private insurance and Medicaid overall and per capita spending differ. Medicaid experienced higher annual growth in total spending than per capita spending, while private insurance had greater annual growth in per capita spending than total spending. Growth in private insurance per capita spending was higher than growth in Medicaid per capita spending, but growth in Medicaid total spending was higher than growth in private insurance total spending. These data suggest that Medicaid and private insurance may have different drivers of spending growth, highlighting the need for policy makers to examine spending patterns by payer. Further research to determine why such differences in spending growth exist will better inform efforts to increase health care value.

Temporal Coding of Single Auditory Nerve Fibers Is Not Degraded in Aging Gerbils

People suffering from age-related hearing loss typically present with deficits in temporal processing tasks. Temporal processing deficits have also been shown in single-unit studies at the level of the auditory brainstem, midbrain, and cortex of aged animals. In this study, we explored whether temporal coding is already affected at the level of the input to the central auditory system. Single-unit auditory nerve fiber recordings were obtained from 41 Mongolian gerbils of either sex, divided between young, middle-aged, and old gerbils. Temporal coding quality was evaluated as vector strength in response to tones at best frequency, and by constructing shuffled and cross-stimulus autocorrelograms, and reverse correlations, from responses to 1 s noise bursts at 10-30 dB sensation level (dB above threshold). At comparable sensation levels, all measures showed that temporal coding was not altered in auditory nerve fibers of aging gerbils. Furthermore, both temporal fine structure and envelope coding remained unaffected. However, spontaneous rates were decreased in aging gerbils. Importantly, despite elevated pure tone thresholds, the frequency tuning of auditory nerve fibers was not affected. These results suggest that age-related temporal coding deficits arise more centrally, possibly due to a loss of auditory nerve fibers (or their peripheral synapses) but not due to qualitative changes in the responses of remaining auditory nerve fibers. The reduced spontaneous rate and elevated thresholds, but normal frequency tuning, of aged auditory nerve fibers can be explained by the well known reduction of endocochlear potential due to strial dysfunction in aged gerbils.SIGNIFICANCE STATEMENT As our society ages, age-related hearing deficits become ever more prevalent. Apart from decreased hearing sensitivity, elderly people often suffer from a reduced ability to communicate in daily settings, which is thought to be caused by known age-related deficits in auditory temporal processing. The current study demonstrated, using several different stimuli and analysis techniques, that these putative temporal processing deficits are not apparent in responses of single-unit auditory nerve fibers of quiet-aged gerbils. This suggests that age-related temporal processing deficits may develop more central to the auditory nerve, possibly due to a reduced population of active auditory nerve fibers, which will be of importance for the development of treatments for age-related hearing disorders.

Cost Savings from Reducing Pain Through the Delivery of Integrative Medicine Program to Hospitalized Patients

OBJECTIVES

An important task facing hospitals is improving pain management without raising costs. Integrative medicine (IM), a promising nonpharmacologic pain management strategy, is yet to be examined for its cost implications in an inpatient setting. This institution has had an inpatient IM department for over a decade. The purpose was to examine the relationship between changes in patients' pain, as a result of receiving IM therapy, and total cost of care during an inpatient hospital admission.

DESIGN

In this retrospective analysis, data from an EPIC-based electronic health record (EHR) patient demographics, length of stay (LOS), and All Patient Refined Diagnosis Related Groups (APR-DRG) severity of illness measures were utilized. IM practitioners collected and entered patient-reported pain scores into the EHR. The authors regressed the demographic, change in pain, LOS, and APR-DRG variables with changes in pain on total cost for the hospital admission. To estimate cost savings to the hospital, they computed the average reduction in cost associated with reduction in pain by multiplying the coefficient for change in pain by average total cost.

SETTING/LOCATION

A large, tertiary care hospital in Minneapolis, MN.

SUBJECTS

Adult inpatient admissions, 2730, during the study period where patients received IM for pain and met eligibility criteria.

INTERVENTION

IM services provided to inpatients.

OUTCOME MEASURES

Change in pain on an 11-point numeric rating scale before and after initial IM sessions; total costs for hospital admissions.

RESULTS

Both LOS and age were found to increase cost, as did being white, male, married, and having APR-DRG severity coded as extreme. For patients receiving IM therapies, pain was reduced by an average of 2.05 points and this pain reduction was associated with a cost savings of $898 per hospital admission.

CONCLUSIONS

For patients receiving IM therapies, pain was significantly reduced and costs were lowered by about 4%.

Variation in Payment Rates under Medicare's Inpatient Prospective Payment System

OBJECTIVE

To measure variation in payment rates under Medicare's Inpatient Prospective Payment System (IPPS) and identify the main payment adjustments that drive variation.

DATA SOURCES/STUDY SETTING

Medicare cost reports for all Medicare-certified hospitals, 1987-2013, and Dartmouth Atlas geographic files.

STUDY DESIGN

We measure the Medicare payment rate as a hospital's total acute inpatient Medicare Part A payment, divided by the standard IPPS payment for its geographic area. We assess variation using several measures, both within local markets and nationally. We perform a factor decomposition to identify the share of variation attributable to specific adjustments. We also describe the characteristics of hospitals receiving different payment rates and evaluate changes in the magnitude of the main adjustments over time.

DATA COLLECTION/EXTRACTION METHODS

Data downloaded from the Centers for Medicare and Medicaid Services, the National Bureau of Economic Research, and the Dartmouth Atlas.

PRINCIPAL FINDINGS

In 2013, Medicare paid for acute inpatient discharges at a rate 31 percent above the IPPS base. For the top 10 percent of discharges, the mean rate was double the IPPS base. Variations were driven by adjustments for medical education and care to low-income populations. The magnitude of variation has increased over time.

CONCLUSIONS

Adjustments are a large and growing share of Medicare hospital payments, and they create significant variation in payment rates.

Do People with Health Insurance Coverage Who Live in Areas with High Uninsurance Rates Pay More for Emergency Department Visits?

OBJECTIVE

To investigate the relationship between the percent uninsured in a county and expenditures associated with the typical emergency department visit.

DATA SOURCES

The Medical Expenditure Panel Survey linked to county-level data from the American Community Survey, the Healthcare Cost and Utilization Project, and the Area Health Resources Files.

STUDY DESIGN

We use a nationally representative sample of emergency department visits that took place between 2009 and 2013 to estimate the association between the percent uninsured in counties and the amount paid for a typical visit. Final estimates come from a diagnosis-level fixed-effects model, with additional controls for a wide variety of visit, individual, and county characteristics.

PRINCIPAL FINDINGS

Among those with private insurance, we find that an increase of 1 percentage point in the county uninsurance rate is associated with a $20 increase in the mean emergency department payment. No such association is observed among visits covered by other insurance types.

CONCLUSIONS

Results provide tentative evidence that the costs associated with high uninsurance rates spill over to those with insurance, but future research needs to replicate these findings with longitudinal data and methods before drawing causal conclusions. Recent data on changes in area uninsurance rates following the ACA's insurance expansions and subsequent changes in emergency department expenditures afford a valuable opportunity to do this.

The Economics of Provider Payment Reform: Are Accountable Care Organizations the Answer?

A remarkable consensus has developed that the fee-for-service (FFS) approach for paying medical providers must be replaced. This payment approach is said to increase the volume of services without improving care coordination. In response to these calls, Medicare and private payers are experimenting with payment systems that combine the basic element of FFS - a fee for each service - with arrangements that allow providers to share the savings if they hold total spending per patient below a targeted amount. Medicare's accountable care organizations (ACOs) embody the shared savings approach to payment reform. Private payers have introduced total cost of care contracting (TCOC) in several locations. This article questions the consensus that FFS must go. If the fees are too high, then someone needs to "bite the bullet" and reduce fees in key areas. Hoping to control overspending by investment in ACOs is wishful thinking. I describe the theory and practice of shared savings payment systems and summarize recent TCOC contracting initiatives in the private sector. Medicare's shared savings approach is likely to be less effective than private contracts. Cutting providers' fees would be more efficient. Finally, the new payment models in the Affordable Care Act will not ease the problem of high prices for private payers.