The cost and cost-effectiveness of an enhanced intervention for people with substance abuse problems at risk for HIV

OBJECTIVE

To estimate the costs, effectiveness, and cost-effectiveness of prevention interventions for out-of-treatment substance abusers at risk for HIV. This is the first cost-effectiveness study of an AIDS intervention that focuses on drug use as an outcome.

STUDY DESIGN

We examined data from the North Carolina Cooperative Agreement site (NC CoOp). All individuals in the study were given the revised NIDA standard intervention and randomly assigned to either a longer, more personalized enhanced intervention or no additional intervention. We estimated the cost of each intervention and, using simple means analysis and multiple regression models, estimated the incremental effectiveness of the enhanced intervention relative to the standard intervention. Finally, we computed cost-effectiveness ratios for several drug use outcomes and compared them to a "back-of-the-envelope" estimate of the benefit of reducing drug use.

PRINCIPAL FINDINGS

The estimated cost of implementing the standard intervention is $187.52, and the additional cost of the enhanced intervention is $124.17. Cost-effectiveness ratios range from $35.68 to $139.52 per reduced day of drug use, which are less than an estimate of the benefit per reduced drug day.

CONCLUSIONS

The additional cost of implementing the enhanced intervention is relatively small and compares favorably to a rough estimate of the benefits of reduced days of drug use. Thus, the enhanced intervention should be considered an important additional component of an AIDS prevention strategy for out-of-treatment substance abusers.

Expectations among the elderly about nursing home entry

OBJECTIVE

To assess whether the covariates that explain expectations of nursing home entry are consistent with the characteristics of those who enter nursing homes.

DATA SOURCES

Waves 1 and 2 of the Assets and Health Dynamics Among the Oldest Old (AHEAD) survey.

STUDY DESIGN

We model expectations about nursing home entry as a function of expectations about leaving a bequest, living at least ten years, health condition, and other observed characteristics. We use an instrumental variables and generalized least squares (IV-GLS) method based on Hausman and Taylor (1981) to obtain more efficient estimates than fixed effects, without the restrictive assumptions of random effects.

PRINCIPAL FINDINGS

Expectations about nursing home entry are reasonably close to the actual probability of nursing home entry. Most of the variables that affect actual entry also have significant effects on expectations about entry. Medicaid subsidies for nursing home care may have little effect on expectations about nursing home entry; individuals in the lowest asset quartile, who are most likely to receive these subsidies, report probabilities not significantly different from those in other quartiles. Application of the IV-GLS approach is supported by a series of specification tests.

CONCLUSIONS

We find that expectations about future nursing home entry are consistent with the characteristics of actual entrants. Underestimation of risk of nursing home entry as a reason for low levels of long-term care insurance is not supported by this analysis.

Healthcare use among U.S. women aged 45 and older: total costs and costs for selected postmenopausal health risks

The purpose of this study is to estimate the level of healthcare use and costs incurred by postmenopausal women overall and for these selected conditions: cardiovascular disease, osteoporosis, breast cancer, and gynecological cancers. National healthcare survey and discharge data were used to estimate healthcare use by women aged 45 and older. Clinical Classification for Health Policy Research (CCHPR) codes were used to identify patients whose primary diagnosis or procedure corresponded with the selected conditions. National weights were used to estimate resource use. Treatment costs were estimated using cost/charge ratios or the Medicare fee schedule to calculate costs for each individual procedure. Estimated total annual medical care treatment costs for women 45 and older were about $186 billion in 1997 dollars, including about $60.4 billion for cardiovascular disease, $12.9 billion for osteoporosis, and $5.0 billion for breast and gynecological cancers. For each condition, estimated resource use and costs are reported for hospitalization, outpatient, nursing home, and home healthcare services. Resource use and costs are also reported by age and expected source of payment. The economic burden of disease for conditions commonly affecting postmenopausal women is substantial. Prior research establishes that hormone replacement therapy (HRT) may be effective in reducing the burden of disease among women who continue preventive therapy for many years, but few at-risk women do so. New alternatives for prevention, such as selective estrogen receptor modulators (SERMs), may be effective in reducing the burden of disease among postmenopausal women.

Cost-shifting in manged care

We conducted a study of the change from fee-for-service to managed care for mental health services in the Massachusetts Medicaid program, which occurred in fiscal year 1993. We estimated the effect of managed care on total public expenditures over both the short and the long term. Per person expenditures were lower by 24% in the first year of managed care but only lower by 5% in the second and third years. We also tested for cost-shifting by estimating expenditures for five specific services paid by three public agencies. Expenditures on services paid by the managed care vendor decreased, expenditures paid by Medicaid increased, and expenditures paid by the Department of Mental Health decreased. We discuss the implications for both cost-shifting and quality of care improvements. The results from two-part expenditure models indicate that some cost-shifting may be related to quality improvement. The effects are generally stronger for the beneficiaries in the highest quartile of expenditures.

How managed care organizations develop selective contracting networks for psychiatric inpatient care: a Massachusetts case study

Medicaid agencies recently have adopted selective contracting to control use and costs of publicly financed behavioral health care. This case study describes formation of an inpatient network for serving psychiatrically disabled Medicaid beneficiaries in Massachusetts. Network formation is seen as a two-stage process: hospitals first decide to bid for a contract, and form a pool from which the managed care organization chooses hospitals. We used logit models to predict how hospital experience with Medicaid patients, competition, prior reimbursement rates, and geographic distribution affected these two stages. Hospitals are more likely to bid if they have treated more psychiatric inpatients and more disabled Medicaid inpatients receiving Supplemental Security Income. Managed care organizations take into account hospitals' experience with Medicaid patients and geographic dispersion, but not prior reimbursement rates.

Controlling for the endogeneity of peer substance use on adolescent alcohol and tobacco use

This study examines whether the effects of peer substance use on adolescent alcohol and tobacco use are due to endogeneity of adolescents selecting their peer group. We analyzed data collected for a longitudinal analysis of a drug-use prevention programme for upper elementary school students. We used a two-step probit regression to control for the potentially endogenous explanatory variable peer substance use. Rigorous tests of endogeneity and the validity of the instrumental variables showed that controlling for the endogeneity of peer substance use to reduce bias is not worth the reduction in mean squared error in these data. Peer substance use has a positive and significant effect on adolescent substance use for both drinking and smoking. These results imply that peer influence is empirically more important than peer selection (endogeneity) in our sample of adolescents in grades 6-9. Living in a single-parent family was by far the strongest predictor of adolescent drinking and smoking.

Medicare's demonstration of competitive bidding for clinical laboratory services: what it means for clinical laboratories

The purpose of Medicare's Demonstration of Competitive Bidding for Clinical Laboratory Services is to determine whether competitive bidding can be used to provide quality laboratory services at prices below current Medicare reimbursement rates. Here, we present key features of the preliminary design for the demonstration. The following areas are covered: scope of the demonstration, bidding process, selection of winners, reimbursement, quality, and administration and monitoring. The role of the Health Care Financing Administration's Laboratory Technical Advisory Committee is also described, and the future of competitive bidding in a Medicare managed care environment is evaluated. We close with some brief comments on how to succeed in competitive bidding for Medicare services.

School and neighborhood characteristics associated with school rates of alcohol, cigarette, and marijuana use

Previous research has noted that schools vary in substance use prevalence rates, but explanations for school differences have received little empirical attention. We assess variability across elementary schools (N = 36) in rates of early adolescent alcohol, cigarette, and marijuana use. Characteristics of neighborhoods and schools potentially related to school prevalence rates are examined, as well as whether these characteristics have independent effects or whether neighborhood characteristics are mediated by school characteristics. Neighborhood and school characteristics were measured using student, parent, and archival data. The findings show substantial variation across schools in substance use. Attributes of neighborhoods and schools are statistically significantly related to school rates of lifetime alcohol use, lifetime cigarette use, and current cigarette use. Contrary to expectations, lifetime alcohol and cigarette use rates are higher in schools located in neighborhoods having greater social advantages as indicated by the perceptions of residents and archival data. Neighborhood effects are expressed both directly and indirectly through school characteristics. The findings are discussed in light of contagion and social disorganization theories.

Cost shifting in a mental health carve-out for the AFDC population

This study tests whether the managed care vendor shifted costs to Medicaid-reimbursed medical care after the start of the mental health carve-out for the Aid to Families with Dependent Children (AFDC) population in Massachusetts. We used claims data over a 4-year period to estimate expenditures for four types of health services, two of which were paid for by the managed care vendor and two by Medicaid. Total per person public expenditures declined by only about 3 percent. Inpatient psychiatric services were replaced by outpatient psychiatric services and some pharmaceuticals, but overall there was little or no evidence of cost shifting to the medical sector. These results are in contrast to what was found in a sample of Medicaid beneficiaries eligible due to a mental health disability.