Current expenditure patterns

While looking at the changing economic landscape, you may achieve the conclusion that current trends have never been considered as an option in any forecast. Take for example the total anual expenditure per person. In 2008 it was 13.152€, in 2013 it was 11.710€ (current values, without taking into account CPI). A reduction of 10,9% since the begining of the recession. However, the change in one year (2012-2013) is really high in some categories, people are spending more on pharmaceutical products (9,2%) and less in medical services (-9,8%) (p.4).
If you want to look at individual voluntary health insurance, before the recession the per capita expenditure was 132€ (1.218m€/7,364 m population, 2008) while in 2012 was 137€ (1.445m€/7,571m population), an increase of 5€ . These are the official statistical data.

Health financing on the right track

The Changing Role of Government in Financing Health Care:An International Perspective

If you are looking for a paper that reflects all the issues sorrounding health care finance, you are in luck. A recent article in JEP covers the topics to understand what's going on in developed countries. For example,  I found this statement of interest with regard to our current situation:

The relative efficiency of different types of taxes used to finance health systems has been explored in the public finance and health economics literature. The equity and efficiency properties of general taxation (c.f. Auerbach1985) do not differ depending on whether the money is spent on health or education per se, although, if the level of government that collects revenue differs from the level of government that provides health coverage, there may be equity issues and issues about whether the level of taxation best meets local demand for the services required (c.f. Ahmad and Brosio 2006). Of course, the amount of deadweight loss associated with any revenue generation will depend on the balance and type of taxes  used to raise the revenue.

There are huge equity issues to address in our current system, and have to be corrected very soon. I hope we are on the right track and this is going to be solved in forthcoming months.

Investing heavily (2)

Global Healthcare Private Equity Report 2014

One of the adverse effects of financial repression is that investors may lose their compass in the allocation of risk and the prediction of rewards. This repression period for savers will last longer than anybody would expect, since the size of public debt in some countries is still increasing. Therefore, now it is the time for private equity to invest in sectors with greater uncertainty over profits that would be desirable in normal conditions. This is one reason, among others, why hospitals may appear of interest and this is precisely what happened yesterday.
We know from a recent report that while overall private equity investment increased, capital deployed in healthcare declined in 2013.

Investment levels in the medtech and provider sectors in Europe were down in 2013 compared with 2012, when these sectors saw three $1 billion-plus deals between them. Deal value in the provider sector was especially slow, coming in at only a third of the level seen in 2012, partially due to the dearth of large deals like the previous year’s Mediq (a pharmacy distributor) and Four Seasons (nursing homes) deals.

In 2014 the trend could be the opposite, at least near here. The closed operation (1$ billion-plus) will change the landscape of private health care for decades, and some shocks may appear sooner than later. Let's wait for the strategic responses.

PS. It may seem a paradox, but the unintended effect of financial repression by governments is a misperception of risk. Speculative bubbles before the recession have had the same effect. Beware of that.

PS. Regarding yesterday's case, I understand that antitrust issues will be taken into account properly...

Questions without answer (2)

EESRI. Estadística dels centres hospitalaris de Catalunya, 2012

These are hard times for hospital finances, public and private. In 2012, the deficit of acute care publicly funded hospitals was -29 million €, and -32,7 million € for privately funded ones. In public hospitals, deficit has slightly decreased and the opposite for private ones. Losses appear in both cases,  independent from ownership, however its distribution is for sure of interest, but unavailable. All this data come from a report that I check annually. Last year I posted some questions without answer, and again and updated I reproduce them:

• Why private hospitals have a cesarean rate of 37,2% and public hospitals 22.9%? p.15
• Why "productivity" is double in private than in public hospitals? p.19 (31,52 vs 62,40 UMA/personal sanitari) p.21
• Does size matter for efficiency? Public hospitals average income 80,7m€ , private ones 19,6m €  p.22
• Why ambulatory surgery discharges are 47% in publicly funded and 31,6% in private ones ? (p.15) 
• Why people talk about private profits when there are losses every year?

Why are we waiting? (4)

Patients that are waiting for a health service deserve an explanation about the current situation and its potential solution. In former posts I have made some steps in this direction, but the final and definitive one lies on the resources available.
As far as we are publicly spending 1.095 euros per capita, we could ask if in the same State and under the same tax pressure, some people get more resources than us. Let's have a look at Euskadi,( p.5) any citizen there, will have 1.541 euros per capita for health care in 2014. Therefore, we can increase by 40% our health expenditures without increasing our tax pressure. With such an amount of resources we can forget forever the current waiting lists. In Euskadi, they have 0,8% of population waiting (p.6)  and last year the number of patients was reduced by 2,62%. We have 2,4% of population waiting, 3 more times than them, this is unacceptable and requires immediate action.
Fortunately there is a solution. We need only to disconnect as soon as possible, get all the money of our taxes as they do, and only 60.000 patients will wait instead of 180.000 as it is now. This is good news.

PS. Last Sunday this documentary forgot to tell this relevant information to patients. Once again, I repeat what I said: A wider and sound view about current challenges in health care would allow to understand reality and take better decisions. A new documentary should be recorded to replace it. This is my kind request to TV3.

Mental health case-mix measurement

Payment by Results in Mental Health: A Review of the International Literature and an Economic Assessment of the Approach in the English NHS

If there is an area where case-mix measurement has been difficult to tackle it is mental health. After all these years, there are several options, but they need an assessment and adaptation to the context of care.
Fortunately there is an excellent review that can be used as starting point. A York University paper commissioned by UK Health Department that tries to compare a UK specific system and its potential application for budgeting and payment:

The Care Pathways and Packages Clusters classification system addresses both clinical  and nonclinical needs. Care pathways have been mapped, although the degree of clinical  consensus for these is unclear. Nonetheless, they offer a starting point from which to  develop consensus. The English approach will require a more systematic approach to data collection and reporting. This offers an opportunity to collect additional data on resource  use and process or outcome measures that can help evaluate quality and cost-effectiveness, and so inform the debate on what constitutes best clinical practice. Over time, it may be possible to introduce Pay-for-Performance (P4P) elements into the system, so that good practice is appropriately rewarded. However, P4P using a target based approach can  encourage ‘tunnel vision’, in which non-incentivised activity is displaced and would counteract the holistic approach embodied in the Care Pathways and Packages Clusters

Is there anybody thinking about this issue nearby?

Why are we waiting? (3)

The communication vessels theory says that the pressure exerted on a molecule of a liquid is transmitted in full and with the same intensity in all directions (Pascal). This theory applied to hospital waiting lists is converted into the following one: those patients not attended in public hospitals will go to private ones. In order to increase private market share, the public system has to worsen. This is the malevolent theory partly explained in this documentary.
All theories require some support from facts and data. Private health insurance -duplicate coverage- has increased from 23,0% of population (2007) to 24,3% (2011). And discharges per 1000 inhabitants were 25,9 in private hospitals, and 98,7 in publicly funded ones (2007), on the other hand 26,3 and 89,0 respectively (2011). Therefore, there is a 1,3 points of increase in insurance and 0,4 points in hospital discharges in private hospitals. People may contract more insurance slightly but such increase is not reflected equally in discharges. If you want to look for previous trends you'll find other increases of private insurance of 1 pp without any public cutback.
The efforts to relate crisis and cutbacks to communication vessels between public and private is another example of confusion between concurrent facts and causality. Somebody should demonstrate clearly such relationship before broadcasting it on a TV program, otherwise his reputation is at risk.
The additional argument of unfair competition of public hospitals when the provision of privately funded  services requires once again to be proved. Unfair competition as we know it, it's what law defines. I can't see any provision with such possibility in the current law. Otherwise may be considered a comment without a clear definition of what we are talking about. If you add such comments in a documentary it may seem that it is relevant, and once you check it in detail you'll see that those that talk about unfair competition are asking to be contracted by public funding at the same time. Does this make any sense?.
Once again, I repeat what I said: A wider and sound view about current challenges in health care would allow to understand reality and take better decisions. A new documentary should be recorded to replace it. This is my kind request to TV3.

Why are we waiting? (2)

Yesterday we had the ooportunity of watching a documentary on waiting lists. The message was: there were 180 thousand patients waiting for surgery by the end of 2013 and this is the result of cutbacks on public health budgets.
Unfortunately the most relevant question was not asked. The documentary was created around a prejudice over the crisis and budget cuts, an ideological prejudice. Since they had the answer, why look for a question?
The right question any journalist should ask is: Why are there waiting lists? . And we have to remember that this is a fact and it is independent from economic crisis. You can check in this blog a former post on this issue.
Beyond such question, somebody should ask about the situation in other countries and the potential prescriptions for improvement. But the biased journalistic approach to a topic, requires the focus on a concrete ruling politician not on his policy.
If you want to know what happens in other countries, check here. If you want to know about potential solutions, check here. If you want to know how resources are allocated to providers, check here. (Yesterday somebody was saying that it is completely impossible to know how providers are paid (!), and the journalist was unable to check the internet (!)).
They forgot to say that health expenditure is strictly related to wealth creation. Public expenditure on health has jumped from 5% over GDP (2007) up to 5,6% over GDP (2011). Our government was spending 32% on health od the public budget, and right now is 40%. You may disagree about such level, but you must accept that has increased and we are poorer now than before.
Patients require solutions, and they also forgot in the documentary that avoidable hospitalisations is huge (!) (average 16%, range from 6% to 26%).
They also forgot that a methodology  has been proposed and adopted to prioritise waiting lists on a transparent way.
A wider and sound view about current challenges in health care would allow to understand reality and take better decisions. A new documentary should be recorded to replace it. This is my kind request to TV3.

Testing, testing

The Landscape of Inappropriate Laboratory Testing: A 15-Year Meta-Analysis

As a citizen you may be concerned about taxes, as a patient about quality and safety (if you are in a universal publicly funded health care). As both, you should be concerned on cost, quality and access.
Imagine that someone says to you that there is a benefit that is accessible, relatively low cost and at the same time it is ordered but not indicated in 20% of cases, and it is not demanded although necessary in 44% of situations (!). For sure you should be extremely "preoccupied".
The most important difficulty, is that you'll never know that, and this reduces your concerns artificially. If you look at PLOS you'll find such figures from a meta-analysis of last 15 years:

Overall mean rates of over- and underutilization were 20.6% (95% CI 16.2–24.9%) and 44.8% (95% CI 33.8–55.8%). Overutilization during initial testing (43.9%; 95% CI 35.4–52.5%) was six times higher than during repeat testing (7.4%; 95% CI 2.5–12.3%;

Overutilization measured according to restrictivecriteria (44.2%; 95% CI 36.8–51.6%) was three times higher than for permissive criteria (12.0%; 95% CI 8.0–16.0%;P,0.001). Overutilization measured using subjective criteria (29.0%; 95% CI 21.9–36.1%) was nearly twice as high as for objective criteria (16.1%; 95% CI 11.0–21.2%;P=0.004).

With all these statistics together, somebody should do something. The first thing is to know what is happening nearby. Do you know it?

PS. Although this meta-analysis states that underutilization is 44,8%, I would suggest to take caution over this figure. I think that nobody has analysed properly its implications if it were true.

Meanwhile, dancing with Parov Stelar - Shuffle

The massive information leak ever known

No Place to Hide: Edward Snowden, the NSA, and the U.S. Surveillance State

 If someone says to you that a governmental agency has been collecting  data on more than 97 billion emails and 124 billion phone calls in just 30 days, you'd probably think that it is not possible. Imagine a system that has the capacity to reach up to 75% of US emails (!). This is impressive.
Unfortunately, this is absolutely true. Nobody has  rejected it at NSA.One year after the Snowden disclosure of surveillance activities, the US Congress has had to change existing laws and Courts  that allowed such practices.

The international data collected in a single thirty-day period from Germany (500 million), Brazil (2.3 billion), and India (13.5 billion). And yet other files showed collection of metadata in cooperation with the governments of France (70 million), Spain (60 million), Italy (47 million), the Netherlands (1.8 million), Norway (33 million), and Denmark (23 million).

As you may imagine this is not a US issue, but unfortunately the impact and public pressure for change over politicians is different across countries.

I've finished reading the Greenwald book and The Snowden files. I suggest you to start with Greenwald one, the original source better than the remake. I think that one of the most interesting parts is when he explains the rationale for his information disclosure, in Chapter 2:

“The true measurement of a person’s worth isn’t what they say they believe in, but what they do in defense of those beliefs,” he said. “If you’re not acting on your beliefs, then they probably aren’t real.”

  “I do not want to live in a world where we have no privacy and no freedom, where the unique value of the Internet is snuffed out,” Snowden told me. He felt compelled to do what he could to stop that from happening or, more accurately, to enable others to make the choice whether to act or not in defense of those values.

 The book is a milestone over the conflict between freedom and surveillance, over the value of privacy in our current times. It explains many details and raises a lot of uncertainty when using internet for any reason.

PS. By the way, I haven't seen any request to our politicians about how many emails have been suplied to US authorities, how they can justify such leakage and how they have selected them. Somebody must responsible for that.


PS. New report on integrated care, by Antares.

Parov Stelar, All night

The size of the private hospital market

There are two sources to find the size of the private hospital market: EESRI and DBK a consulting firm. The number of beds is close to 30.000 in both sources, the size of income is 6.185 m€ for 2013 according to DBK, and additional 1% compared to the previous year. Private hospitals receive 66% of their income from insurance companies. In 2013 it grew 3,4%, while health insurance premiums rose 2,8%. Public funding of private hospitals is decreasing, -4% and private out-of -pocket as well -3,2%. Insurance companies are increasingly funding private hospitals beyond its growth in premiums. Such figures show a clear pattern that is being replicated in the last years. I wrote a post on such trend about three years ago. What I said there, is already confirmed today.

PS. For those that consider privatization as public funding of services in private organizations, and for those that support that the size of privatization is growing, these data testify just the opposite. Therefore, where is the underpinning of the argument?

PS. In my opinion, as I said in this post some time ago, it is not privatization, it is commercialism.

High-performing boards' agenda

Source: High-performing boards: What’s on their agenda?

Boards' oversight of quality

Hospital Board Oversight of Quality and Patient Safety: A Narrative Review and Synthesis of Recent Empirical Research

Usually we focus our debate more on cost than on quality. As far as cost measurement is easier, we are able to comment, critise the level of expenditures, wether it is low or high. Concerns about quality and safety should be up in the agenda.And in recent years there has been relevant efforts in this direction. However, since there is no aggregated measure on quality, we have to enter into specific details and justifications.
The determinants of quality and safety are diverse. However, if we look at the top of the organization, board of trustees implication is crucial. Unfortunately, this is not always the case, they are more prone to discuss bugets and investments.
At Milbank you'll find a review on how hospital boards that take care of quality and safety issues have better results:

Recent empirical studies linking board composition and processes with patient outcomes have found clear differences between high- and lowperforming hospitals, highlighting the importance of strong and committed leadership that prioritizes quality and safety and sets clear and measurable goals for improvement. Effective oversight is also associated with well-informed and skilled board members. External factors (such as regulatory regimes and the publication of performance data) might also have a role in influencing boards, but detailed empirical work on these is scant.

Is there anybody nearby boosting such role for boards?

Inequality in the winner-take-all society (2)

The message of the former post was partial. It didn't raise suggestions for improvement in our unequal world. Fortunately, today's op-ed from Shiller adds some fresh air. He retrieves his book The New Financial Order: Risk in the 21st Century written a decade ago and proposes a new tool:

Inequality insurance would require governments to establish very long-term plans to make income-tax rates automatically higher for high-income people in the future if inequality worsens significantly, with no change in taxes otherwise. I called it inequality insurance because, like any insurance policy, it addresses risks beforehand.

This is only one of the six proposals that he develops in such an interesting book.The idea maybe good, the implementation is for sure uncertain. Govenments should commit to efficient redistribution approaches (although up to now I haven't seen them). And beyond this, the constraint again is the same as yesterday: global coordination on tax pressure and on inequality insurance design.

PS A year after Snowden leakage on how privacy has been systematically circumvented, check its impact in this report.