DRGs and Australian psychiatry

Marginal revenue and length of stay in inpatient psychiatry

This study examines the changes in marginal revenue during psychiatric inpatient stays in a large Swiss psychiatric hospital after the introduction of a mixed reimbursement system with tariff rates that vary over length of stay. A discrete time duration model with a difference-in-difference specification and time-varying coefficients is estimated to assess variations in policy effects over length of stay. Among patients whose costs are fully reimbursed by the mixed scheme, the model demonstrates a significant effect of marginal revenue on length of stay. No significant policy effects are found among patients for whom only health insurance rates are delivered as mixed tariffs and government contributions are made retrospectively. The results indicate that marginal revenue can affect length of stay in inpatient psychiatry facilities, but that the reduction in marginal revenue must be sufficiently large.

[The new financial compensation system PEPP: an ethical analysis]

BACKGROUND

The new compensation system for psychiatric and psychosomatic institutions (German acronym: PEPP) not only constitutes a change in billing practices, but also necessitates an ethical investigation and analysis of possible consequences of the new legislation for those affected in practice.

MATERIAL AND METHODS

Following the presentation of the new PEPP and its consequences for psychiatric practice, problems and areas of conflict will be analyzed from an ethical perspective and discussed.

RESULTS

Ethical conflicts exist in the following areas: (1) in the attempt to standardize inpatient care and invoicing for mental illnesses, (2) in poorer treatment for severely ill patients in view of degressive per diem rates, (3) in false incentives due to threshold values e.g. for 1:1 health professional-patient ratios in the case of coercive measures and (4) due to the inappropriate use of a supposed normative neutral quantitative economic model for a qualitative work area that often takes place in human border zones such as complex inpatient care of severely mentally ill patients.

CONCLUSION

The ethical analysis of PEPP reveals that apart from the limited opportunities to improve efficiency, there is a considerable ethical risk of loss of quality in psychiatric inpatient care in particular for severely and chronically mentally ill patients.

Financial and organisational reforms in the health sector; implications for the financing and management of mental health care services

Since 1980 many developed countries have planned and implemented health sector reforms of different scales and ambitions. Norway has been no exception, and the main political aspirations have been to increase efficiency and improve consumer choice and responsiveness. The major financial reform was the introduction of an activity based financing based on diagnostic related groups (DRG). Other central reforms include legislative rights for patients to choose hospital of their own choice, and the handing over of the responsibility of hospital based care form the county to the state. For some of these reforms mental health care is not included. The aim of the study is to appraise with examples from different countries whether it is feasible include metal health care into the reforms and whether the reforms in general are conducive for mental health care policy goals. The problems are elaborated and discussed at the level of technically and politically feasibility and the costs involved.

The role of economic evaluation in mental health care

OBJECTIVE

A consequence of the integration of psychiatry into acute and public health medicine is that psychiatrists are being asked to evaluate their services. There is pressure on mental health-care systems because it is recognized that funds should be directed where they can provide the best health outcomes, and also because there are resource constraints which limit our capacity to meet all demands for health care. This pressure can be responded to by evaluation which demonstrates the effectiveness and efficiency of psychiatric treatment. This paper seeks to remind psychiatrists of the fundamental principles of economic evaluation in the hope that these will enable psychiatrists to understand the methods used in evaluation and to work comfortably with evaluators.

METHOD

The paper reviews the basic principles behind economic evaluation, illustrating these with reference to case studies. It describes: (i) the cost of the burden of illness and treatment, and how these costs are measured; (ii) the measurement of treatment outcomes, both as changes in health status and as resources saved; and (iii) the various types of economic evaluation, including cost-minimization, cost-effectiveness, cost-utility and cost-benefit analysis.

RESULTS

The advice in the paper provides psychiatrists with the necessary background to work closely with evaluators. A checklist of the critical questions to be addressed is provided as a guide for those undertaking economic evaluations.

CONCLUSIONS

If psychiatrists are willing to learn the basic principles of economic evaluation and to apply these, they can respond to the challenges of evaluation.

Health of the Nation Outcome Scales. Results of the Victorian field trial

BACKGROUND

In Victoria, Australia, systematic assessment of outcomes in mental health services are being instituted.

AIMS

To carry out a large-scale field trial of the Health of the Nation Outcome Scales (HoNOS).

METHOD

2137 clients were rated by mental health workers on the HoNOS, and about half were rated again within a few months.

RESULTS

While interrater reliability of the total score was satisfactory, that of some individual items was unacceptable. Significant associations with age and gender were found, and clients with non-psychotic disorders obtained higher (i.e. worse) ratings than those with psychotic disorders. There were relationships between service use and HoNOS total score. For the group as a whole, total scores had not changed at the second rating, but admissions and discharges were associated with increases and decreases in total score. Among clients in the community, there was no relationship between change in HoNOS total score and frequency of contacts.

CONCLUSIONS

Certain items, notably 11 and 12, were unreliable. The absence of evidence of sensitivity to change may be due to the short re-rating interval, little real change in the clients, or the characteristics of the scale itself.

Effect of casemix funding on outcomes in patients admitted to hospital with suspected unstable angina

OBJECTIVES

To determine the effect of the introduction of casemix funding on resource utilisation and clinical outcomes in patients admitted to hospital with suspected unstable angina.

DESIGN

A prospective cohort study with a 6-month follow-up.

SETTING

A suburban community hospital in Melbourne, Victoria.

PATIENTS

336 consecutive patients admitted to the coronary care unit with suspected unstable angina before (156) and after (180) the introduction of casemix funding.

INTERVENTION

Introduction of casemix funding in July 1993.

MAIN OUTCOME MEASURES

Indices of resource utilisation: length of stay in hospital, length of stay in the coronary care unit, and total cost of investigations (pathology and radiology). Rates of serious cardiac events during hospital stay and after discharge. Readmissions within 28 days and 6 months of discharge.

RESULTS

After the introduction of casemix funding there was a 1% increase in duration of hospital stay and a 5% increase in time spent in the coronary care unit, but neither of these increases was statistically significant. However, there was a significant reduction in total cost of investigations (39% decrease; 95% confidence interval, 14%-70%; P < 0.001). The rate of serious cardiac events after discharge did not increase, and neither did readmission rates, either within 28 days or over the 6 months' follow-up.

CONCLUSION

Casemix funding had no effect on short term clinical outcomes but resulted in significantly reduced investigation costs.