Unbiased Analysis of Today's Healthcare Issues
Yesterday, I reviewed one paper claiming PPS along with competition reduced cost, but these cost reductions occurred mostly for the most expensive (read most sick) patients. Continuing the PPS theme, today we will look at a 1995 article in Econometrica in which David Cutler attempts to measure “The Incidence of Adverse Medical Outcomes under Prospective…
Prospective Payment Systems (PPS) and competition go hand in hand. Without competition, a PPS gives hospitals and physicians the incentive to minimize health care outlays. A competitive fee-for-service (FFS) system-to which most Americans were accustomed to in the 1980s-can lead to severe cost increases due to the problem of moral hazard. Combining PPS and competition…
You may be used to calling your doctor and being told by the staff that you must wait weeks to see your family practice physician. Now imagine calling your doctor and hearing, “I can see you this afternoon…or tomorrow if you like…which one is best for you Mr. Shafrin?” How can a practice be able to do…
We are now in the information age. Let’s take a look at the following numbers: Internet World Stats reports that approximately 70% of Americans now have access to the Internet. (This puts it 7th in the world in terms of Internet penetration). Over 85% of physicians have access to high speed internet in their offices.…
Many studies have claimed that Nurse Practitioners (NPs)–as well as Physician Assistants (PAs)–are adequate substitutes for primary care physicians. Researchers claim that NPs can perform a great majority of the tasks currently carried out by primary care physicians, and should be used more frequently since NP and PA salaries are usually half of primary care…
According to the Milwaukee Journal-Sentinel (“Orthopedic hospital…“), the Orthopaedic Hospital of Wisconsin posted profit margins of 52%. The article claims that the healthcare industry generally only has profit margins of around 3%-5%. Does this mean that the Orthopaedic Hospital of Wisconsin is providing highly valued services? Is it good at cutting costs? Or is it…
“People generally don’t have a clue about what the health care they are consuming costs,” Michael O. Leavitt, the Secretary of Health and Human Services told reporters in a WebMD article (“Gov’t releases hospital prices“). With a new initiative in hand, Mr. Leavitt hopes that consumer ignorance will soon dissipate. Yesterday, officials at the Centers…
Can consumer-driven health care (CDHC) really work? According to the New York Times, many entrepreneurs believe it can. In “Attention Shoppers,” the newspaper details how Wal-Mart, CVS and other chain stores are opening walk-in health clinics. The clinics are staffed by Nurse Practitioners and operated independently of the chain store. The benefits of the walk-in…
The Independent of the UK reports (“Childbirth revolution“) that the British government is “planning a ‘strategic shift’ in childbirth policy away from hospital delivery and towards births in the home.” Instead of having doctors supervise the birth, midwives will deliver the child. On one hand, I commend the British government for this policy change. The…
RVU costing sets physicians’ fees by employing various accounting procedures to determine the relative worth of each service they provide. An article by Mark Berlin in Healthcare Financial Management (1997) details how the RVU costing system works. First let us examine the four types of cost accounting group practices traditionally use. Job Order Costing. This…