Unbiased Analysis of Today's Healthcare Issues
I have written in the past about the recent popularity of single specialty hospitals (see “Focused Factories” and “…Specialty Hospitals” posts). A paper by Kathleen Carey investigates whether or not single specialty hospitals are more efficient than traditional mutli-specialty hospitals. The study finds the following: Overall, single speciality hospitals (SSH) are not more cost efficient…
Patients choose hospitals based on the quality of the medical care they receive and the hospital’s distance from their home. But what nonclinical criteria do patients value most? The Salud y Gestión blog reviews the findings of a study in The McKinsey Quarterly. The study found that patients rank the following as the most important…
Health economics, physicians and health services researchers have found that overuse, not underuse, is the major problem for many medical services. Yet you rarely here a campaign to reduce that quantity of medical care provided. Why is this? An editorial in Health Services Research gives two important explanations for this. First, measuring overuse is difficult.…
How do financial arrangement between physicians within a medical group affect efficiency levels? This is the question Gaynor and Pauly (JPE 1990) attempt to answer. Theory The authors assume that the quantity of medical services is produced by the following production function: qi = f(hi, ti, ki, ei, θi) h: physician hours, t: non-physician hours,…
Pay-for-performance (P4P) is the latest rage among health wonks as to how to improve the health care system. But does P4P really improve quality? Mullen, Frank and Rosenthal (2008) hope to answer this question. One would initially believe that paying physicians to perform certain medically necessary tasks will improve quality. Further, some P4P involves structural…
The Bureau of Labor Statistics reports that Medical CPI is only 3.2%. This is less than the 4.1% average inflation rate over the past ten years and the 6.0% average medical inflation rate over the past 30 years. In most markets, a slowing economy reduces demand and reduces prices (see the recent decline in oil…
With the economy in a downturn, many firms have been hard hit. Industries that sell luxury goods have been especially hard hit. One example of a luxury good sector taking a beating is the elective surgery market. The New York Times reports that dermatologists, facial surgeons and plastic surgeons have all seen a significant drop in…
Patients generally believe that managed care systems are put in place to restrict their access to care. Many patients believe that physicians who receive capitation compensation will provide less care to their patients than physicians who are paid on a fee-for-service basis. A paper by Fang and Rizzo (2008) investigates whether or not this is really they…
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…
Hospital-acquired, or nosocomial, infections are often caused by poor hospital care. Patients arrive to the hospital and often leave with infections caused by unsanitary hospital conditions. Should Medicare pay for these hospital-induced health care costs? A knee jerk reaction would be to say no. If the hospital adversely influence patient health, Medicare or other payors should…