An ongoing tug-of-war

Understanding Differences Between High- And Low-Price Hospitals: Implications For Efforts To Rein In Costs

Consolidation of private healthcare providers is an increasing trend nowadays. The exact implications for competition and choice are usually unknown. It is worth having a look at other markets. This article in HA explains the impact for the US context:

Prior research shows that private hospital prices vary considerably both within and across markets, even after differences in patient populations and services provided are accounted for. The wide variations in price and the high prices at some hospitals reflect an ongoing tug-of-war between increasingly consolidated buyers (health plans) and increasingly consolidated sellers (hospitals and hospital systems).

Given the intense and growing pressure to rein in the growth in private health insurance premiums, the continuation of current trends appears to be unsustainable. It remains to be seen whether or not health plans will somehow regain the upper hand. If they do not, more radical approaches—such as state-based rate setting or restrictions on contracting arrangements between hospitals and health plans—may gain traction.

PS. HA Blog, a comment.

PS. On limiting bisphenol in food.

PS. Health expenditures NEJM Graphic 

PS.Health Policy Basics: Health Insurance Marketplaces

PS. Are Human Genes Patentable? 

PS. Regulating 23andMe to Death Won’t Stop the New Age of Genetic Testing

Who is the owner?

While reading a recent op-ed on hospitals in a National Health System, suddenly I asked myself: but who is the owner?. The article was reflecting a new view on hierarchy and management of public organizations and was advocating for new cooperative models, horizontal schemes where professionals fit better than a pure civil servant. It may sound good, although it raises a certain fuzzy landscape. Who has the decision rights in a cooperative scheme? Who is the residual claimant?. Just check The Economist for a recent case and remember the potential implications if we translate such model in health care.
There are two sides of the coin: management and governance. Managers and owners have their specific roles. When somebody wants to play both, conflicts of interest arise. It's obvious. Unfortunately in public organizations, such considerations are too often forgotten. Public organizations require better governance designs, stronger and clearer, representing the preferences of the final owner: the citizen.

TMT syndrome

What It Will Take To Achieve The As-Yet-Unfulfilled Promises Of Health Information Technology?

Each day every newspaper wants to convince us over a new technology. In biosciences, journalists enjoy talking about "opening doors" to new cures, and rarely anybody checks afterwards if this anouncement is really in place and provides its expected outcomes. Most of what we see in the media regarding these anouncements are free adverts.
The promise of information technologies in health care is another example. Its application is crucial for success, it is available, but it takes a long, long time to be applied. The disapointing impact of IT on health care has been the last year's article most read in Health Affairs . It is not by chance. We live in a society with a "too much technology" -TMT- syndrome. Organizations can't digest it without internal change in management and governance. Why not create some organizational conditions for success?

Thrasymachus

Wikipedia dixit:

Thrasymachus was a citizen of Chalcedon, on the Bosphorus. His career appears to have been spent as a sophist at Athens, although the exact nature of his work and thought is unclear. He is credited with an increase in the rhythmic character of Greek oratory, especially the use of the paeonic rhythm in prose, and a greater appeal to the emotions through gesture.

Quote from Plato's Thrasymachus in Republic I

338c: Ἄκουε δή, ἦ δ᾽ ὅς. φημὶ γὰρ ἐγὼ εἶναι τὸ δίκαιον οὐκ ἄλλο τι ἢ τὸ τοῦ κρείττονος συμφέρον..[1] (“Listen—I say that justice is nothing other than the advantage of the stronger.”)

This forceful statement is dated from 426 BCE more or less. I'm just quoting it after 25 centuries.

Yesterday at Auditori. Jordi Savall and Le Concert des Nations. Impressive.

Pharma news

The growth in the number of pharmaceutical prescriptions per capita in 2013 has fallen by 6,9%, unit price 1,8% less, and total expenditure minus 8,6%, completing a 4 years cycle of negative deelopment. This means that 80% of the decrease is due to the number of prescriptions.
It seems that physicians are increasing the quality of prescription following a specific policy. This is good news. However, more assessment is needed.

PS. Recent statement at Davos Conference:
"Europe's light at the end of the tunnel looks more and more like an oncoming train"

Where is the regulator?

Understanding the Economic Value of Molecular Diagnostic Tests: Case Studies and Lessons Learned

Maybe we have just arrived at the expected moment, when the cost of one whole genome sequencing is below $1000. (mapping up to 25.000 genes). At the same time, one test for 21 genes may cost you $4.500. This is our crazy world. In the first case you will only know your genome, in the second there will be a probability of success from a certain therapy.
There's only one question: Does anybody know any information about the reliability of such probabilities beyond the firm that is selling the test?. Where is the regulator?
After reading a recent article on the value of molecular diagnostic tests, I'm convinced that we still remain in an uncertain world in need of transparency. Given such uncertainty, better keep calm until the regulator confirms the clinical utility and cost-effectiveness of molecular diagnostic tests.

Parov Stelar Band - Jimmy's Gang (Unplugged in Moscow)

PS. You may avoid watching "The wolf of Wall Street" if you read this article.

Poor quality regulation

Lyn Stout says in his book: Good laws makes good people. Today I would like to confirm again that bad regulation distorts markets. In 1999 it was decided that only group contracting for private health insurance would have some tax rebates, individual insurance lost such consideration. Fifteen years after, the government has decided that such rebates will be subject to social security contributions, this exactly means an increase in buyer's cost by 36%, 30% for the employer and 6% for the employee. In 2012 the average premium in the individual market was 731 €, while the group premium 562€. Such difference is huge since the product is nearly the same, and differential cost can't justify a discount of 23%. Former regulation may explain such distorsion, and precisely this was my argument in an article 3 years ago.
Nowadays group health insurance is not included under income tax, although it may be in the next step. Any government should assess how regulation distorts markets, and fit decisions to strictly improve markets functioning. I think that right now they are strictly thinking on more income and don't care about the impact that may be relevant next year.

On being accountable

FOCUSING ACCOUNTABILITY ON THE OUTCOMES THAT MATTER

A new report from a recent conference has been released. Accountable care is the term that summarises a US trend.
Beyond fashionable concepts, there is the reality. Let's take the definition for health care:

Delivering accountable care for a population involves five key components:
1. A specified population for which providers are jointly accountable.
2. Target outcomes for the population - outcomes that matter to individuals.
3. Metrics and learning, to monitor performance on outcomes and to learn from variation.
4. Payments and incentives aligned with the target outcomes.
5. Co-ordinated delivery, across a range of providers, of the care necessary for
achieving the desired outcomes.

My impression is that in our health system we already have good examples of such organisations. Unfortunately, some issues fail due to wrong regulation. For example, payment and incentives, an issue that should be reformed as soon as possible.

PS. Here you'll find an older post on the same topic of payment and incentives.

PS. Definition. Accountable. adjective \ə-ˈkau̇n-tə-bəl\ : required to explain actions or decisions to someone : required to be responsible for something

The one and only option

Imagine for a moment a country, their citizens are presumably under the same constitution and tax law. Some citizens in a geographic area have a per capita public budget for health care for 2014 equal to 1.541 €. Other citizens, 1.091 € or less. There is no possible argument to maintain such huge and increasing differences. Is there any clever politician in the room to treat such disease? For sure, there isn't.
Simplistically speaking, my understanding is that we could decrease taxes by 28% or otherwise increase public health expenditures by 41%. Since these options are not plausible, the third is to forget such country because it is unable to solve the real public policy challenges. And worst than that, it obliges to apply budget cuts to those that already are spending less. Since such problems have persisted for three decades, the one and only option is to leave, reform is not a credible option.

PS. Data