Why is end-of-life spending so high?

The answer is because using more intensive services does reduce mortality. This is the finding of a recent JAMA paper. After controlling for patient case mix, the authors examine variation in hospital spending in the last year of a patient’s life. The authors note that “Higher-spending hospitals differed in many ways, such as greater use…

The Downside of Concentrated Health Care Markets

Many recent healthcare policies aim to consolidate the provision of medical services.  For instance, Accountable Care Organizations consolidate providers with the goal of providing seamless, integrated patient care.  Consolidation can increase efficiency and (potentially) drive down prices.  If a market is highly concentrated, however, problems in a single supplier can lead to shortages.  Consider the…

Costing Methods

How do hospitals estimate the cost of different inpatient stays?  A paper by Clement et al. (2009) reviews 3 techniques: Microcosting. “With microcosting, a detailed list of each component of a patient’s care is created and costed separately for each facet of a patient’s hospitalization. Given the level of detail, microcosting is generally considered the…

Canadian Social Security and Well-Being

Does Social Security work?  By that, I mean does giving elderly individuals a government pension increase their level of income, the amount of goods the can consume, or even their happiness? An NBER working paper by Baker, Gruber and Milligan (2009) tries to answer this question in the Canadian setting. Background Currently, Canadian income transfer…

Physician Compensation in Canada

Does physician compensation affect the quantity of medical care provided?  My paper “Operating on Commission” claims that the answer is yes.  I find that surgery rates increase 78% when patients switch from capitation to fee-for-service (FFS) specialists. A paper by Devlin and Sarma (2008) examines a similar question for Canadian family physicians.  Since the inception…

Health Care Around the World: Canada

Canada has a single payer system but the provinces have the bulk of the responsibility of running the health care system for their own residents. In order to qualify for federal funding, each province must meet the following criteria. Universality. Available to all provincial residents on uniform terms and conditions; Comprehensiveness. Covering all medically necessary…