Public health and the economy could be served by reallocating medical expenditures to social programs.
ABSTRACT: As much as 30% of US health care spending in the United States does not improve individual or population health. To a large extent this excess spending results from prices that are too high and from administrative waste. In the public sector, and particularly at the state level, where budget constraints are severe and reluctance to raise taxes high, this spending crowds out social, educational, and public-health investments. Over time, as spending on medical care increases, spending on improvements to the social determinants of health are starved. In California the fraction of General Fund expenditures spent on public health and social programs fell from 34.8% in fiscal year 1990 to 21.4% in fiscal year 2014, while health care increased from 14.1% to 21.3%. In spending more on healthcare and less on other efforts to improve health and health determinants, the state is missing important opportunities for health-promoting interventions with a strong financial return. Reallocating ineffective medical expenditures to proven and cost-effective public health and social programs would not be easy, but recognizing its potential for improving the public's health while saving taxpayers billions of dollars might provide political cover to those willing to engage in genuine reform. National estimates of the percent of medical spending that does not improve health suggest that approximately $5 billion of California's public budget for medical spending has no positive effect on health. Up to 10,500 premature deaths could be prevented annually by reallocating this portion of medical spending to public health. Alternatively, the same expenditure could help an additional 418,000 high school students to graduate.
Project description:Background:Conceptual frameworks of fiscal space for health have traditionally considered health system efficiency improvements as a means to free up resources for the sector. However, there has been no comprehensive review of the evidence to confirm the relationship between efficiency and fiscal space. Methods:We conducted a systematic review to synthesize evidence on whether efficiency gains increase fiscal space for health. We searched bibliographic databases for specific keywords - namely, fiscal space, efficiency and health - and identified 22 articles that examined links between efficiency gains and fiscal space for health. The articles, which encapsulated 28 case studies, were included in the analysis. Results:The 28 case studies varied widely with regard to how efficiency was evaluated, the extent to which efficiency was explored, and how efficiency gains could be achieved. Half of the studies assessed both technical and allocative efficiency, and the other half assessed technical efficiency only. The indicators to examine potential inefficiencies varied substantially among studies. The most frequently cited inefficiencies stemmed from public financial management (budget implementation, budget allocation and strategic purchasing) and governance issues, even though these were characterized in various ways. The second most cited set of inefficiencies that caused health systems to function poorly were those related to health service delivery. Procurement and delivery of input factors was also mentioned in some studies as a source of inefficiency. Though most studies conceded that efficiency gains were a potential means to improve fiscal space for health, very few quantified the potential gains or explored practical mechanisms to translate efficiency gains into fiscal space for health. Conclusions:While the conceptual link between efficiency gains and fiscal space for health may be assumed, there is no direct empirical evidence proving that efficiency gains translate into more resources for the health sector. Mechanisms to translate efficiency gains into fiscal space are barely explored in the fiscal space literature. Public financial management rules and related rules for reallocating funds within the sector need to be further examined to guide countries in the transformation of efficiency gains into more resources for health.
Project description:To examine whether local expenditures for public health activities influence area-level medical spending for Medicare beneficiaries.Six census surveys of the nation's 2,900 local public health agencies were conducted between 1993 and 2013, linked with contemporaneous information on population demographics, socioeconomic characteristics, and area-level Medicare spending estimates from the Dartmouth Atlas of Health Care.Measures derive from agency survey data and aggregated Medicare claims.A longitudinal cohort design follows the geographic areas served by local public health agencies. Multivariate, fixed-effects, and instrumental-variables regression models estimate how area-level Medicare spending changes in response to shifts in local public health spending, controlling for observed and unmeasured confounders.A 10 percent increase in local public health spending per capita was associated with 0.8 percent reduction in adjusted Medicare expenditures per person after 1 year (p < .01) and a 1.1 percent reduction after 5 years (p < .05). Estimated Medicare spending offsets were larger in communities with higher rates of poverty, lower health insurance coverage, and health professional shortages.Expanded financing for public health activities may provide an effective way of constraining Medicare spending, particularly in low-resource communities.
Project description:<h4>Background</h4>The health sector in Lebanon suffers from high levels of spending and is acknowledged to be a source of fiscal waste. Lebanon initiated a series of health sector reforms which aim at containing the fiscal waste caused by high and inefficient public health expenditures. Yet these reforms do not address the issues of health equity in use and coverage of healthcare services, which appear to be acute. This paper takes a closer look at the micro-level inequities in the use of healthcare, in access, in ability to pay, and in some health outcomes.<h4>Methods</h4>We use data from the 2004/2005 Multi Purpose Survey of Households in Lebanon to conduct health equity analysis, including equity in need, access and outcomes. We briefly describe the data and explain some of its limitations. We examine, in turn, and using standardization techniques, the equity in health care utilization, the impact of catastrophic health payments on household wellbeing, the effect of health payment on household impoverishment, the equity implications of existing health financing methods, and health characteristics by geographical region.<h4>Results</h4>We find that the incidence of disability decreases steadily across expenditure quintiles, whereas the incidence of chronic disease shows the opposite pattern, which may be an indication of better diagnostics for higher quintiles. The presence of any health-related expenditure is regressive while the magnitude of out-of-pocket expenditures on health is progressive. Spending on health is found to be "normal" and income-elastic. Catastrophic health payments are likelier among disadvantaged groups (in terms of income, geography and gender). However, the cash amounts of catastrophic payments are progressive. Poverty is associated with lower insurance coverage for both private and public insurance. While the insured seem to spend an average of almost LL93,000 ($62) on health a year in excess of the uninsured, they devote a smaller proportion of their expenditures to health.<h4>Conclusions</h4>The lowest quintiles of expenditures per adult have less of an ability to pay out-of-pocket for healthcare, and yet incur healthcare expenditures more often than the wealthy. They have lower rates of insurance coverage, causing them to spend a larger proportion of their expenditures on health, and further confirming our results on the vulnerability of the bottom quintiles.
Project description:OBJECTIVE: To assess health care disparities among black and Latino adults with schizophrenia receiving services during the period July 1994-June 2006, and to evaluate trends in observed disparities. DATA SOURCES: Administrative claims data from the Florida Medicaid program. Data sources included membership files (demographic information), medical claims (diagnostic, service, and expenditure information), and pharmacy claims (prescriptions used and expenditures). STUDY DESIGN: We identified adults with at least two schizophrenia claims during a fiscal year. We used generalized estimating equation models to estimate disparities in spending on psychotropic drugs, psychiatric inpatient services, all mental health services, and all health services. PRINCIPAL FINDINGS: Spending on psychotropic drugs, mental health, and all health was 0.9-70 percent lower for blacks and Latinos than for whites. With the exception of blacks with substance use disorder comorbidity, minorities were less likely than whites to use psychiatric inpatient services. Psychiatric inpatient spending among users did not differ by race/ethnicity. With the exception of psychiatric inpatient utilization/spending, trend analyses showed no change or modest reductions in disparities. CONCLUSIONS: Black and Latino Medicaid recipients diagnosed with schizophrenia experience health care disparities. Some but not all disparities narrowed modestly over the study period.
Project description:BACKGROUND:With some Medicaid state programs still restricting patient access to hepatitis C (HCV) treatment, it is important to demonstrate how states could expand treatment access to a broader Medicaid population and balance short-term budget concerns. METHODS:We used the HCV Transmission and Progression (TaP) Markov model to quantify the impact of removing restrictions to HCV treatment access on the infected populations, expenditures, and net social value for the North Carolina (NC), Oregon (OR), and Wisconsin (WI) Medicaid programs. Four HCV treatment access scenarios were modeled: 1) Baseline: Patients were treated according to Medicaid disease severity and sobriety requirements in 2015; 2) Remove Sobriety Restrictions: Disease severity restrictions were maintained, but people who inject drugs (PWID) were given access to treatment; 3) Treat Early: All patients, except for PWIDs, regardless of disease severity, were eligible for treatment and the diagnosis rate increased from 50 to 66%; and 4) Remove Access Restrictions: all patients, regardless of disease severity and sobriety, were eligible for treatment. Our key model outputs were: number of infected Medicaid beneficiaries, HCV-related medical and treatment expenditures, total social value, and state Medicaid spending over 10 years. RESULTS:Across all three states, removing access restrictions resulted in the greatest benefits over 10 years (net social value relative to baseline = $408 M in NC; $408 M in OR; $271 M in WI) and the smallest infected population (5200 in NC; 2000 in OR; 614 in WI). Reduced disease transmission resulted in lower health care expenditures (-$66 M in NC; -$50 M in OR; -$54 M in WI). All of the expanded treatment access policies achieved break-even costs-where total treatment and health care expenditures fell below those of Baseline-in 4 to 8 years. Removing access restrictions yielded the greatest improvement in social value (net of medical expenditures and treatment costs, QALYs valued at $150 K per QALY). CONCLUSIONS:While increasing treatment access in Medicaid will raise short-term costs, it will also provide clear benefits relatively quickly by saving money and improving health within a 10-year window. Patients and taxpayers would benefit by considering these gains and taking a more expansive and long-term view of HCV treatment policies.
Project description:INTRODUCTION:Public health spending in India has been traditionally one of the lowest globally. Punjab is one of the states with highest proportion of out-of-pocket expenditures for healthcare in India. We undertook this study to produce the sub-national health accounts (SNHA) for Punjab state in India. METHODOLOGY:We used System of Health Accounts (SHA) 2011 framework for preparing health accounts for Punjab state. Data on health spending by government was obtained from concerned public sector departments both at state and central level. Estimates on Out-of-Pocket Expenditures (OOPE) expenditure were derived from National Sample Survey (NSS) 71st round data, Consumer Expenditure Survey (CES) data and Pharmatrac. Primary surveys were done for assessing health expenditure data by firms and non-governmental organizations. All estimates of healthcare expenditures reported in our paper pertain to 2013-14, and are reported in both Indian National Rupee (INR) and United States Dollar (US $),using average conversion rate of INR 60.50 per US $. RESULTS:In 2013-14, the current health expenditures (CE) in Punjab was INR 134,680million (US $ 2245 million) which was 4.02% of its gross state domestic product (GSDP).However, public spending on health was 0.95% of GSDP i.e. 21% of the total health expenditure (THE), while 79% was private expenditure. In per capita terms, THE in Punjab was INR 4963 (US $ 82.03). In terms of functions, medical goods (41.6%) and curative care (37%) consumed larger share of expenditure in the Punjab state. Households spent 52% of expenditures for medicines and other pharmaceutical goods. Risk pooling mechanisms are being adopted to a lesser extent in the state. CONCLUSION:The healthcare in Punjab is largely financed through private OOPE. Currently, public health spending in Punjab is inadequate to meet the healthcare demands of population, which is less than 1% of state's GSDP. Monitoring public resources is very important for better resource allocations. Health Accounts production is useful in order to assess future trends and impact of health financing policies on goals of universal health coverage and should be made a part of routine monitoring system both at national and sub-national level.
Project description:To investigate whether tax-exempt hospitals' investments in community health are associated with patterns of governmental public health spending focusing specifically on the relationship between hospitals' community benefit expenditures and the spending patterns of local health departments (LHDs).We combined data on tax-exempt hospitals' community benefit spending with data on spending by the corresponding LHD that served the county in which a hospital was located. Data were available for 2 years, 2009 and 2013. Generalized linear regressions were estimated with indicators of hospital community benefit spending as the dependent variable and LHD spending as the key independent variable.Hospital community benefit spending was unrelated to how much local public health agencies spent, per capita, on public health in their communities.Patterns of local public health spending do not appear to impact the investments of tax-exempt hospitals in community health activities. Opportunities may, however, exist for a more active engagement between the public and private sector to ensure that the expenditures of all stakeholders involved in community health improvement efforts complement one another.
Project description:Introduction:Although economic crises are common in low/middle-income countries (LMICs), the evidence of their impact on health systems is still scant. We conducted a comparative case study of Maranhão and São Paulo, two unevenly developed states in Brazil, to explore the health financing and system performance changes brought in by its 2014-2015 economic recession. Methods:Drawing from economic and health system research literature, we designed a conceptual framework exploring the links between macroeconomic factors, labour markets, demand and supply of health services and system performance. We used data from the National Health Accounts and National Household Sample Survey to examine changes in Brazil's health spending over the 2010-2018 period. Data from the National Agency of Supplementary Health database and the public health budget information system were employed to compare and contrast health financing and system performance of São Paulo and Maranhão. Results:Our analysis shows that Brazil's macroeconomic conditions deteriorated across the board after 2015-2016, with São Paulo's economy experiencing a wider setback than Maranhão's. We showed how public health expenditures flattened, while private health insurance expenditures increased due to the recession. Public financing patterns differed across the two states, as health funding in Maranhão continued to grow after the crisis years, as it was propped up by transfers to local governments. While public sector staff and beds per capita in Maranhão were not affected by the crisis, a decrease in public physicians was observed in São Paulo. Conclusion:Our case study suggests that in a complex heterogeneous system, economic recessions reverberate unequally across its parts, as the effects are mediated by private spending, structure of the market and adjustments in public financing. Policies aimed at mitigating the effects of recessions in LMICs will need to take such differences into account.
Project description:In times of economic crisis, most countries face the dual challenge of fighting unemployment while restraining social expenditures and closing budget deficits. The spending cuts and lack of employment affect a large number of decisions that have a direct or indirect impact on health. This impact is likely to be unevenly distributed among different groups within the population, and therefore not only health levels may be at risk, but also their distribution. The main purpose of this paper is to explore links between unemployment, economic growth, inequality, and health. We regress a measure of health, the Health Human Development Index (HHDI), against a set of explanatory variables accounting for the countries' economic performance (GDP growth, unemployment, and income inequality), and some institutional factors related to welfare spending and the nature of the health systems for the past three decades. In addition, we explore the causes for different results obtained using an inequality-adjusted HHDI, vs. the unadjusted HHDI. We describe a panel data model, estimated by random effects, for 32 countries from 1980-2010, in five-year intervals. Our conclusion is that the high economic growth observed in the last decades, together with an increase in the levels of income inequality and/or poverty, explain the observed changes of our index, particularly when this indicator is weighted by health inequality. The remaining institutional variables (the share of social spending, health care expenditure, and the type of health systems) show the expected sign but are not statistically significant. A comment on the methodological pitfalls of the approach completes the analysis.
Project description:BACKGROUND:Funding of orphan medicinal products (OMPs) is an increasing challenge in the European Union (EU). OBJECTIVES:To identify the different methods for public funding of OMPs in order to map the availability for rare disease patients, as well as to compare the public expenditures on OMPs in 8 EU member states. METHODS:Information on the reimbursement status of 83 OMPs was collected in 8 countries by distinguishing standard and special reimbursements. In two consecutive years, the total public expenditures on OMPs were calculated by using annual EUR exchange rates. Annual total public expenditures were calculated per capita, and as a proportion of GDP, total public pharmaceutical and healthcare budgets. Differences between countries were compared by calculating the deviations from the average spending of countries. RESULTS:In 2015 29.4-92.8% of the 83 OMPs were available with any kind of public reimbursement in participant countries including special reimbursement on an individual basis. In Austria, Belgium and France more OMPs were accessible for patients with public reimbursement than in Bulgaria, Czech Republic, Hungary and Poland. Standard reimbursement through retail pharmacies and/or hospitals was applied from 0 to 41% of OMPs. The average annual total public expenditure ranged between 1.4-23.5 €/capita in 2013 and 2014. Higher income countries spent more OMPs in absolute terms. Participant countries spent 0.018-0.066% of their GDPs on funding OMPs. Average expenditures on OMPs were ranged between 2.25-6.51% of the public pharmaceutical budget, and 0.44-0.96% of public healthcare expenditures. CONCLUSIONS:Standard and special reimbursement techniques play different roles in participant countries. The number of accessible OMPs indicated an equity gap between Eastern and Western Europe. The spending on OMPs as a proportion of GDP, public pharmaceutical and healthcare expenditure was not higher in lower income countries, which indicates substantial differences in patient access to OMPs in favour of higher-income countries. Equity in access for patients with rare diseases is an important policy objective in each member state of the EU; however, equity in access should be harmonized at the European level.