Implementing the Lean 5S process improvement to boost efficiency and cost savings in hospital supply rooms

ABSTRACT

A strong link exists between adequate supply chain management and nurse efficiency and satisfaction. Implementing Lean methodology, specifically 5S process improvement, staff created a unit-based supply room that was clean, safe, and well organized which led to reduced waste, greater efficiency, and cost savings.

Changes in spending, utilization, and quality of care among Medicare accountable care organizations during the COVID-19 pandemic

The COVID pandemic disrupted health care spending and utilization, and the Medicare Shared Savings Program (MSSP), Medicare’s largest value-based payment model with 11.2 million assigned beneficiaries, was no exception. Despite COVID, the 513 accountable care organizations (ACO) in MSSP returned a program record $1.9 billion in net savings to Medicare in 2020. To understand the extent of COVID’s impact on MSSP cost and quality, we describe how ACO spending changed in 2020 and further analyze changes in measured quality and utilization. We found that non-COVID per capita spending in MSSP fell by 8.3 percent from $11,496 to $10,537 (95% confidence interval(CI),-1,223.8 to-695.4, p<0.001), driven by 14.6% and 7.5% reductions in per capita acute inpatient and outpatient spending, respectively. Utilization fell across inpatient, emergency, and outpatient settings. On quality metrics, preventive screening rates remained stable or improved, while control of diabetes and blood pressure worsened. Large reductions in non-COVID utilization helped ACOs succeed financially in 2020, but worsening chronic disease measures are concerning. The appropriateness of the benchmark methodology and exclusion of COVID-related spending, especially as the virus approaches endemicity, should be revisited to ensure bonus payments reflect advances in care delivery and health outcomes rather than COVID-related shifts in spending and utilization patterns.

Review of economic data on closed system transfer drug for preparation and administration of hazardous drugs

OBJECTIVES

The objectives of this study were to review economic data on the use of closed system drug transfer devices (CSTDs) for preparing and administering hazardous drugs, and to evaluate the quality of data reporting as defined by the Consolidated Health Economic Evaluation Reporting Standards (CHEERS).

METHODS

All references from a recent Cochrane review about CSTDs were evaluated for inclusion. A literature review was also conducted. Articles containing economic data about the use of CSTDs were retained for analysis. Two researchers independently graded the articles according to the 24-item CHEERS checklist.

RESULTS

Of the 138 articles identified initially, 12 were retained for analysis. Nine of these studies did not report acquisition costs or did not detail acquisition costs. Six studies reported economic benefits associated with the used of CSTDs, all related to extending the beyond-use date. The mean number of CHEERS criteria fulfilled by the included articles was 9.2 (SD 2.4).

CONCLUSIONS

CSTDs are costly to acquire. However, few studies have examined the economic impact of these devices, and the existing studies are incomplete. As a result, hospitals planning to implement these devices will be unable to make a sound economic evaluation. Robust economic evaluation of CSTDs is needed.

Savings or Selection? Initial Spending Reductions in the Medicare Shared Savings Program and Considerations for Reform

Policy Points Concerns have been raised about risk selection in the Medicare Shared Savings Program (MSSP). Specifically, turnover in accountable care organization (ACO) physicians and patient panels has led to concerns that ACOs may be earning shared-savings bonuses by selecting lower-risk patients or providers with lower-risk panels. We find no evidence that changes in ACO patient populations explain savings estimates from previous evaluations through 2015. We also find no evidence that ACOs systematically manipulated provider composition or billing to earn bonuses. The modest savings and lack of risk selection in the original MSSP design suggest opportunities to build on early progress. Recent program changes provide ACOs with more opportunity to select providers with lower-risk patients. Understanding the effect of these changes will be important for guiding future payment policy.

CONTEXT

The Medicare Shared Savings Program (MSSP) establishes incentives for participating accountable care organizations (ACOs) to lower spending for their attributed fee-for-service Medicare patients. Turnover in ACO physicians and patient panels has raised concerns that ACOs may be earning shared-savings bonuses by selecting lower-risk patients or providers with lower-risk panels.

METHODS

We conducted three sets of analyses of Medicare claims data. First, we estimated overall MSSP savings through 2015 using a difference-in-differences approach and methods that eliminated selection bias from ACO program exit or changes in the practices or physicians included in ACO contracts. We then checked for residual risk selection at the patient level. Second, we reestimated savings with methods that address undetected risk selection but could introduce bias from other sources. These included patient fixed effects, baseline or prospective assignment, and area-level MSSP exposure to hold patient populations constant. Third, we tested for changes in provider composition or provider billing that may have contributed to bonuses, even if they were eliminated as sources of bias in the evaluation analyses.

FINDINGS

MSSP participation was associated with modest and increasing annual gross savings in the 2012-2013 entry cohorts of ACOs that reached $139 to $302 per patient by 2015. Savings in the 2014 entry cohort were small and not statistically significant. Robustness checks revealed no evidence of residual risk selection. Alternative methods to address risk selection produced results that were substantively consistent with our primary analysis but varied somewhat and were more sensitive to adjustment for patient characteristics, suggesting the introduction of bias from within-patient changes in time-varying characteristics. We found no evidence of ACO manipulation of provider composition or billing to inflate savings. Finally, larger savings for physician group ACOs were robust to consideration of differential changes in organizational structure among non-ACO providers (eg, from consolidation).

CONCLUSIONS

Participation in the original MSSP program was associated with modest savings and not with favorable risk selection. These findings suggest an opportunity to build on early progress. Understanding the effect of new opportunities and incentives for risk selection in the revamped MSSP will be important for guiding future program reforms.

Medicare's Bundled Payment Initiatives for Hospital-Initiated Episodes: Evidence and Evolution

Policy Points Evidence suggests that bundled payment contracting can slow the growth of payer costs relative to fee-for-service contracting, although bundled payment models may not reduce absolute costs. Bundled payments may be more effective than fee-for-service payments in containing costs for certain medical conditions. For the most part, Medicare's bundled payment initiatives have not been associated with a worsening of quality in terms of readmissions, emergency department use, and mortality. Some evidence suggests a worsening of other quality measures for certain medical conditions. Bundled payment contracting involves trade-offs: Expanding a bundle's scope and duration may better contain costs, but a more comprehensive bundle may be less attractive to providers, reducing their willingness to accept it as an alternative to fee-for-service payment.

CONTEXT

Bundled payments have been promoted as an alternative to fee-for-service payments that can mitigate the incentives for service volume under the fee-for-service model. As Medicare has gained experience with bundled payments, it has widened their scope and increased their duration. However, there have been few reviews of the empirical literature on the impact of Medicare's bundled payment programs on cost, resource use, utilization, and quality.

METHODS

We examined the history and features of 16 of Medicare's bundled payment programs involving hospital-initiated episodes of care and conducted a literature review of articles about those programs. Database and additional searches yielded 1,479 articles. We evaluate the studies' methodological quality and summarize the quantitative findings about Medicare expenditures and quality of care from 37 studies that used higher-quality research designs.

FINDINGS

Medicare's bundled payment initiatives have varied in their design features, such as episode scope and duration. Many initiatives were associated with little to no reduction in Medicare expenditures, unless large pricing discounts for providers were negotiated in advance. Initiatives that included post-acute care services were associated with lower expenditures for certain conditions. Hospitals may have been able to reduce internal production costs with help from physicians via gainsharing. Most initiatives were not associated with significant changes in quality of care, as measured by readmission and mortality rates. Of the significant changes in readmission rates, the results were mixed, showing increases and decreases associated with bundled payments. Some evidence suggested that worse patient outcomes were associated bundled payments, although most results were not statistically significant. Results on case-mix selection were mixed: Several initiatives were associated with reductions in episode severity, whereas others were associated with little change.

CONCLUSIONS

Bundled payments for hospital-initiated episodes may be a good alternative to fee-for-service payments. Bundled payments can help slow the growth of payer spending, although they do not necessarily reduce absolute spending. They are associated with lower provider production costs, and there is no overwhelming evidence of compromised quality. However, designing a bundled payment contract that is attractive to both providers and payers proves to be a challenge.

"THINK" Before You Order: Multidisciplinary Initiative to Reduce Unnecessary Lab Testing

Inappropriate daily lab testing can have adverse effects on patients, including anemia, pain, and interruption of sleep. We implemented a student-led, multifaceted intervention featuring clinician education, publicity campaign, gamification, and system changes, including a novel nurse-driven protocol to reduce unnecessary daily lab testing in a teaching hospital. We applied a quasi-experimental interrupted time series design with a segmented regression analysis to estimate changes before and after our 14-month intervention with a comparison to a control surgical unit. There was an increasing trend in the baseline period, which was mitigated by the intervention (postintervention effect estimate -0.04 labs per patient day/month, p < .05), which was not seen in the control unit. Estimated cost savings was $94,269 ($6,734/month). A student-led, multidisciplinary campaign involving nurse-driven pathway, education, publicity, gamification, and system changes was effective in reducing daily lab testing.

Outdate Reduction and Cost Savings with Rapid Testing for Seven-Day Platelet Storage

Platelets for transfusion in the US are stored at room temperature which is associated with a risk of bacterial transmission and subsequent sepsis. A recent FDA Final Guidance has been issued with options to mitigate this risk while maintaining or enhancing platelet availability.Storage had been limited to five days for many years due to the risk of bacterial growth. The short shelf-life has resulted in a national outdate rate of approximately 16%. FDA has recently cleared two devices as "safety measures" the use of which now allows seven-day platelet storage in bags cleared for this option. The Platelet PGD Test (Verax Biomedical, Marlborough, MA) is one such device and the other is the bioMérieux BacT/Alert Microbial Detection System (Durham, NC). These "safety measure" options are included in the Final Guidance.In 2018 and 2019, we conducted a survey of 16 blood collection centers and 66 hospitals that use the PGD Test to extend platelet dating to seven days to ascertain how this has resulted in reduced outdating and thereby saved costs. The surveyed institutions were collectively responsible for 21-22% of the annual volume of platelet transfusions in the US.The blood collection centers reported that extension of platelet storage to seven days resulted in a mean outdate reduction of 69% (median 67%, range 23%-92%) and mean cost savings of $415,000 (median $300,000, range $150,000-$900,000). The hospitals reported that extension of platelet storage to seven days resulted in a mean outdate reduction of 74% (median 80%, range 17%-100%) and mean cost savings of $176,803 (median $150,000, range $30,000-$1,200,000). Hospitals saved 24,080 platelet doses annually and blood centers saved 18,700 doses annually. From these institutions alone, this represents a savings of more than 2% of platelet transfusions in the US.Extending platelet shelf-life to seven days with the PGD Test significantly reduced outdating of this valuable resource, increased product availability in accord with FDA Final Guidance recommendations, and saved more money than bacterial testing costs in the surveyed institutions.Results have been presented in part at the Association of Clinical Scientists Annual Meeting, Hershey, PA May 2019.

Improving the prognosis of health care in the USA

Although health care expenditure per capita is higher in the USA than in any other country, more than 37 million Americans do not have health insurance, and 41 million more have inadequate access to care. Efforts are ongoing to repeal the Affordable Care Act which would exacerbate health-care inequities. By contrast, a universal system, such as that proposed in the Medicare for All Act, has the potential to transform the availability and efficiency of American health-care services. Taking into account both the costs of coverage expansion and the savings that would be achieved through the Medicare for All Act, we calculate that a single-payer, universal health-care system is likely to lead to a 13% savings in national health-care expenditure, equivalent to more than US$450 billion annually (based on the value of the US$ in 2017). The entire system could be funded with less financial outlay than is incurred by employers and households paying for health-care premiums combined with existing government allocations. This shift to single-payer health care would provide the greatest relief to lower-income households. Furthermore, we estimate that ensuring health-care access for all Americans would save more than 68 000 lives and 1·73 million life-years every year compared with the status quo.

Assessing the incremental costs and savings of introducing electronic immunization registries and stock management systems: evidence from the better immunization data initiative in Tanzania and Zambia

INTRODUCTION

Poor data quality and use have been identified as key challenges that negatively impact immunization programs in low- and middle-income countries (LMICs). In addition, many LMICs have a shortage of health personnel, and staff available have demanding workloads across several health programs. In order to address these challenges, the Better Immunization Data (BID) Initiative introduced a comprehensive suite of interventions, including an electronic immunization registry aimed at improving the quality, reliability, and use of immunization data in Arusha Region, Tanzania, and Southern Province of Zambia. The objective of this study was to assess the incremental costs of implementing the BID interventions in immunization programs in these two countries.

METHODS

We conducted a micro-costing study to estimate the economic costs of service delivery and logistics for the immunization programs with and without the BID interventions in a sample of health facilities and district program offices in each country. Structured questionnaires were used to interview immunization program staff at baseline and post-intervention to assess annual resource utilization and costs. Cost outcomes were reported as annual cost per facility, cost per district and changes in resource costs due to the BID interventions (i.e., costs associated with health worker time, start-up costs, etc.). Sub-group analyses were conducted by health facility to assess variation in costs by volume served and location (rural versus urban). One-way sensitivity analyses were conducted to identify influential parameters. Costs were reported in 2017 US dollars.

RESULTS

In Tanzania, the average annual reduction in resource costs was estimated at US$10,236 (95% confidence interval: $7,606-$14,123) per health facility, while the average annual reduction in resource costs per district was estimated at $6,542. In Zambia, reductions in resource costs were modest at an estimated annual average of $628 (95% confidence interval: $209-$1,467) per health facility and $236 per district. Resource cost reductions were mainly attributable to reductions in time required for immunization service delivery and reporting. One-way sensitivity analyses identified key cost drivers, all related to reductions in health worker time.

CONCLUSION

The introduction of electronic immunization registries and stock management systems through the BID Initiative was estimated to result in potential time savings in both countries. Health worker time was the area most impacted by the interventions, suggesting that time savings gained could be utilized for patient care. Information generated through this work provides evidence to inform stakeholder decision-making for scale-up of the BID interventions in Tanzania and Zambia and to inform other Low-to-Middle-Income Countries (LMICs) interested in similar interventions.

Letting the Numbers Speak for Themselves: A Simple Approach to Cost Reduction for Laparoscopic Appendectomy

Instrument choices are influenced primarily by a surgeon's training and individual preference. Cost is often of secondary interest, particularly in the absence of any contracted fiscal obligation to the hospital. The purpose of this study was to evaluate how a simple intervention involving dissemination of cost data among a surgeon peer group influenced behavior with respect to surgical instrument choice. Cost data for laparoscopic appendectomies between July-December 2016 were disseminated to surgeons belonging to the same department of a teaching hospital. Each surgeon was provided his or her own cost data along with blinded data for his or her peers for comparison. Cost for each disposable instrument used among the group was provided for reference. Costs of laparoscopic appendectomy performed after the intervention (June-December 2017) were compared with costs before the intervention, for both individual surgeons and the group as a whole. A random effects linear regression model clustered on surgeon was then used to assess the average cost saving of the intervention while accounting for the intracorrelation of surgeon costs. One outlier was removed from the analysis, resulting in a cohort of 89 cases before the intervention and 74 postintervention. After outlier removal, data were normally distributed. The mean cost per case decreased for 10 of the 11 surgeons analyzed (minimum decrease of $7 to maximum decrease of $725). The remaining surgeon increased from an average of $985 ± 235 pre-intervention to $1003 ± 227 postintervention. The average cost saving for the group was $238 ± 226 and was associated with an average reduction in cost of 21 per cent. A linear regression analysis clustered on surgeon suggested the intervention was associated with an average saving of $260 (β = -260, SE = 39, P < 0.001). After dissemination of cost data among surgeon peers, a reduction in costs was observed. Most notably, significant savings occurred in the absence of any mandate or incentive to reduce costs. Providing cost data to surgeons to facilitate natural competition among peers is a simple and effective tool for reducing operating room costs.

The Population Health Value Framework: Creating Value by Reducing Costs of Care for Patient Subpopulations With Chronic Conditions

PROBLEM

With the growth in risk-based and accountable care organization contracts, creating value by redesigning care to reduce costs and improve outcomes and the patient experience has become an urgent priority for health care systems.

APPROACH

In 2016, UCLA (University of California, Los Angeles) Health implemented a system-wide population health approach to identify patient populations with high expenses and promote proactive, value-based care. The authors created the Patient Health Value framework to guide value creation: (1) identify patient populations with high expenses and reasons for spending, (2) create design teams to understand the patient story, (3) create custom analytics and spending-based risk stratification, and (4) develop care pathways based on spending risk tiers. Primary care patients with three chronic conditions-dementia, chronic kidney disease (CKD), and cancer-were identified as high-cost subpopulations.

OUTCOMES

For each patient subpopulation, a multispecialty, multidisciplinary design team identified reasons for spending and created care pathways to meet patient needs according to spending risk. Larger, lower-risk cohorts received necessary but less intensive interventions, while smaller, higher-risk cohorts received more intensive interventions. Preliminary analyses showed a 1% monthly decrease in inpatient bed day utilization among dementia patients (incident rate ratio [IRR] 0.99, P < .03) and a 2% monthly decrease in hospitalizations (IRR 0.98, P < .001) among CKD patients.

NEXT STEPS

Use of the Patient Health Value framework is expanding across other high-cost subpopulations with chronic conditions. UCLA Health is using the framework to organize care across specialties, build capacity, and grow a culture for value.

Estimated Changes in Manufacturer and Health Care Organization Revenue Following List Price Reductions for Hepatitis C Treatments

IMPORTANCE

Pharmaceutical manufacturers rarely reduce drug list prices, but 3 expensive treatments for hepatitis C experienced significant list price reductions in 2018. Understanding the impetus for these price reductions could inform policies to reduce drug spending.

OBJECTIVE

To estimate the differences in manufacturer and health care organization revenue from the Medicare Part D program following list price reductions for hepatitis C treatments, accounting for manufacturer discounts to eligible health care organizations under the 340B drug discount program and manufacturer rebates to pharmacy benefit managers.

DESIGN, SETTING, AND PARTICIPANTS

A cross-sectional analysis of Medicare Part D claims for hepatitis C treatments in 2016 was conducted. Data analysis was performed in February 2019. Using the observed price changes from 2018, manufacturer and 340B health care facility net revenues for each drug were estimated before and after the price change based on 2016 use, adjusting for estimated 340B health care organization discounts and pharmacy benefit manager rebates. The 340B health care organizations include hospitals, clinics, and other organizations that meet federal standards to participate in the 340B program and were actively enrolled in the 340B program from January 1 to December 31, 2016. Manufacturer discounts to 340B health care organizations are based on the price of a drug before rebates to pharmacy benefit managers, and a reduced list price would reduce discounts to 340B health care organizations. Health care organization-level claims data were obtained from the Medicare Part D Provider Utilization File, and health care organizations were matched to Health Resources and Services Administration Office of Pharmacy Affairs Information System to identify 340B-eligible health care organizations. Eligible claims included claims for ledipasvir with sofosbuvir (Harvoni; Gilead Sciences Inc), sofosbuvir with velpatasvir (Epclusa; Gilead Sciences Inc), and elbasvir with grazoprevir (Zepatier; Merck). Health care organizations were considered 340B eligible if their practice address was a registered 340B entity for the entirety of 2016.

MAIN OUTCOMES AND MEASURES

Discounts to 340B health care organizations and pharmacy benefit managers for each drug before and after the price change were the primary outcomes. Other outcomes included per-treatment and aggregate manufacturer and 340B health care organization net revenues for each drug before and after the price change and the share of claims prescribed by 340B health care organizations for each drug. Per-treatment manufacturer net revenues were estimated for 340B health care organizations, non-340B health care organizations, and a weighted average revenue across health care organization types.

RESULTS

The 3 hepatitis C treatments evaluated had 30% to 41% of claims prescribed by 340B-eligible health care organizations, greater than the 14% 340B prescribing rate for all Medicare Part D drugs. Based on use data from 2016, list price reductions for hepatitis C treatments in 2018 were estimated to have increased aggregate manufacturer net revenues for 3 treatments by $181.9 million-a 28% increase. Aggregate 340B health care organization net revenues were estimated to have been $181.9 million lower-a 74% decrease.

CONCLUSIONS AND RELEVANCE

List price reductions for hepatitis C treatments may have increased drug manufacturer net revenues, owing in part to lower discounts provided under the 340B program and the high share of sales subject to those discounts. Policymakers should consider the role of 340B discounts when evaluating policies to reduce drug spending.

Association Between Specialist Office Visits and Health Expenditures in Accountable Care Organizations

IMPORTANCE

Accountable care organizations (ACOs) aim to control health expenditures while improving quality of care. Primary care has been emphasized as a means to reduce spending, but little is known about the implications of using specialists for achieving this ACO objective.

OBJECTIVE

To examine the association between ACO-beneficiary office visits conducted by specialists and the cost and utilization outcomes of those visits.

DESIGN, SETTING, AND PARTICIPANTS

This cross-sectional study obtained data on 620 distinct ACOs from the Centers for Medicare & Medicaid Services Shared Savings Program Accountable Care Organizations Public-Use Files from April 1, 2012, to September 30, 2017. Generalized estimating equation models were used for analysis of ACOs, adjusting for ACO-beneficiary health status, Medicare enrollment groups, ACO size, and proportion of participating specialists.

EXPOSURES

Specialist encounter proportion, the percentage of office visits provided by a specialist, was categorized into 7 discrete groups: less than 35%, 35% to less than 40%, 40% to less than 45% (reference group), 45% to less than 50%, 50% to less than 55%, 55% to less than 60%, and 60% or greater.

MAIN OUTCOMES AND MEASURES

The primary outcome was total expenditures (given in US dollars) per assigned beneficiary person-year. The secondary outcomes were total numbers of emergency department visits, hospital discharges, skilled nursing facility discharges, and magnetic resonance imaging orders.

RESULTS

In total, the data set included 1836 ACO-year (number of participation years per ACO) observations for 620 distinct ACOs. Those ACOs with a specialist encounter proportion of 40% to less than 45% had $1129 (95% CI, $445-$1814) lower per-beneficiary person-year spending than did ACOs in the lowest specialist encounter proportion group and had $752 (95% CI, $115-$1389) lower per-beneficiary person-year spending compared with ACOs in the highest specialist encounter proportion group. Monotonic decreases in emergency department visits, hospital discharges, and skilled nursing facility discharges were observed with increasing specialist encounter proportion. Conversely, monotonic increases in magnetic resonance imaging volume discharges were observed with increasing specialist encounter proportion.

CONCLUSIONS AND RELEVANCE

These findings suggest that an ACO's ability to reduce spending may require sufficient involvement in care processes from specialists, who seem to complement the intrinsic primary care approach in ACOs.

What are the potential savings from steering patients to lower-priced providers? a static analysis

OBJECTIVES

Healthcare payers are increasingly using price transparency and benefit design to encourage patients to choose lower-priced providers. We quantify potential savings from shifting patients to lower-priced providers. If there is limited price variation or if higher-priced providers command little market share, savings could be minimal.

STUDY DESIGN

Using 2013-2014 commercial claims for 697,381 enrollees in California, we characterized within-market price variation and the relationship between providers' market shares and relative prices for 3 nonemergent, shoppable outpatient services: laboratory tests, imaging services, and durable medical equipment (DME). In a stylized policy simulation that holds provider price and utilization constant, we computed potential savings if patients who visited providers with prices above the median price shifted to the median-priced provider in their geographic market for the same service.

METHODS

Observational analyses.

RESULTS

Of the service categories examined, laboratory tests had greatest within-market price variation (median coefficient of variation of 100% vs 87% for imaging services and 43% for DME). Roughly half of services (53%, 47%, and 54% for laboratory tests, imaging services, and DME, respectively) were billed by providers with prices above their market median. Shifting these patients to the median-priced provider in their markets could save 42%, 45%, and 15% of spending on laboratory tests, imaging services, and DME, respectively, together representing savings of 11% of total outpatient spending and 7% of the sum of inpatient and outpatient spending.

CONCLUSIONS

Steering patients from higher- to lower-priced providers within geographic markets in targeted service categories could generate substantial healthcare savings.

Managing cost of care and healthcare utilization in patients using immunoglobulin agents

The introduction of human immunoglobulin (Ig) therapies 40 years ago reduced the risk of often life-threatening infections for individuals with one of several immune-related conditions known as primary immunodeficiencies. Since then, the use of Ig has expanded to numerous other conditions. However, even though less than 1% of covered lives under Medicare or commercial insurers require Ig, it is in the top 5 drug categories in terms of annual spending. The cost of Ig is directly related to the type of delivery method used and the site of care. Numerous studies attest to the efficacy and cost savings of shifting Ig to the home setting, as well as shifting patients from intravenous Ig (IVIG) to subcutaneous Ig (SCIG). In addition, surveys find that patients with primary immunodeficiencies prefer home delivery, with patient evaluations also finding a preference for SCIG. Payers have numerous options to ensure Ig is used appropriately for the right patient in the right setting. These include formulary management, site-of-care programs, education for providers and patients on the possibility of switching from IVIG to SCIG, preauthorization policies that restrict the use of Ig to certain specialties for specific indications, implementation of evidence-based coverage criteria, and shifting coverage from the medical to the pharmacy benefit.

Who benefits most in disease management programs: Improving target efficiency

Disease management programs aim to reduce cost by improving the quality of care for chronic diseases. Evidence of their effectiveness is mixed. Reducing health care spending sufficiently to cover program costs has proved particularly challenging. This study uses a difference in differences design to examine the impact of a diabetes disease management program for high risk patients on preventive tests, health outcomes, and cost of care. Heterogeneity is examined along the dimensions of severity (measured using the proxy of poor glycemic control) and preventive testing received in the baseline year. Although disease management programs tend to focus on the sickest, the impact of this program concentrates in the group of people who had not received recommended tests in the preintervention period. If confirmed, such findings are practically important to improve cost-effectiveness in disease management programs by targeting relevant subgroups defined both based on severity and on (missing) test information.

The Effectiveness of Cost Reduction with Charge Displays on Test Ordering under the Health Insurance System in Japan: A Study Using Paper-based Simulated Cases for Residents and Clinical Fellows

Objective To determine whether or not displaying the cost of tests can help reduce charges on test ordering in Japan. Methods This study was conducted under the setting of a simulated first visit of an outpatient for general internal medicine in a secondary medical institution in Japan. We randomly assigned 27 residents and clinical fellows to Team A or B. The first half, without charges displayed on the ordering system, was designated the "non-display group," and the participants of Team A selected tests for each paper-based simulated case (Q1-Q14), while the participants of Team B selected tests for Q15-Q28. The second half, which had charges displayed, was designated the "display group," and the participants of Team A selected tests for Q15-Q28, while the participants of Team B selected tests for Q1-Q14. The main outcome measure was the difference in the cost of tests per paper-based simulated case between the non-display and display groups. Results The median (interquartile range) cost of tests per paper-based simulated case was 12,255 yen (5,040-23,695 yen) in the non-display group versus 9,425 yen (2,320-21,700 yen) in the display group, showing a decrease of 2,830 yen with charges being displayed (p=0.002). Conclusion Displaying the charges when ordering tests in paper-based simulated cases resulted in cost reduction. The adoption of this intervention may reduce health insurance costs under the health insurance system in Japan, which has features such as universal health coverage and universal access to care.

Length of stay following vaginal deliveries: A population based study in the Friuli Venezia Giulia region (North-Eastern Italy), 2005-2015

BACKGROUND

Lengths of hospital stay (LoS) after childbirth that are too long have a number of health, social and economic drawbacks. For this reason, in several high-income countries LoS has been reduced over the past decades and early discharge (ED) is increasingly applied to low-risk mothers and newborns.

METHODS

We conducted a population-based study investigating LoS after chilbirth across all 12 maternity centres of Friuli Venezia-Giulia (FVG), North-Eastern Italy, using a database capturing all registered births in the region from 2005 to 2015 (11 years). Adjusting for clinical factors (clinical conditions of the mother and the newborn), socio-demographic bakground and obstetric history with multivariable logistic regression, we ranked facility centres for LoS that were longer than our proposed ED benchmarks (defined as >2 days for spontaneous vaginal deliveries and >3 days for instrumental vaginal deliveries). The reference was hospital A, a national excellence centre for maternal and child health.

RESULTS

The total number of births examined in our database was 109,550, of which 109,257 occurred in hospitals. During these 11 years, the number of births significantly diminished over time, and the pooled mean LoS for spontaneous vaginal deliveries in the whole FVG was 2.9 days. There was a significantly decreasing trend in the proportion of women remaining admitted more than the respective ED cutoffs for both delivery modes. The percentage of women staying longer that the ED benchmarks varied extensively by facility centre, ranging from 32% to 97% for spontaneous vaginal deliveries and 15% to 64% for instrumental vaginal deliveries. All hospitals but G were by far more likely to surpass the ED cutoff for spontaneous deliveries. As compared with hospital A, the most significant adjusted ORs for LoS overcoming the ED thresholds for spontaneous vaginal deliveries were: 89.38 (78.49-101.78); 26.47 (22.35-31.36); 10.42 (9.49-11.44); 10.30 (9.45-11.21) and 8.40 (7.68-9.19) for centres B, D, I, K and E respectively. By contrast the OR was 0.77 (95%CI: 0.72-0.83) for centre G. Similar mitigated patterns were observed also for instrumental vaginal deliveiries.

CONCLUSIONS

For spontaneous vaginal deliveries the mean LoS in the whole FVG was shorter than 3.4 days, the average figure most recently reported for the whole of Italy, but higher than other countries' with health systems similar to Italy's. Since our results are controlled for the effect of all other factors, the between-hospital variability we found is likely attributable to the health care provider itself. It can be argued that some maternity centres of FVG may have had ecocomic interest in longer LoS after childbirth, although fear of medico-legal backlashes, internal organizational malfunctions of hospitals and scarce attention of ward staff on performance efficiency shall not be ruled out. It would be therefore important to ensure higher level of coordination between the various maternity services of FVG, which should follow standardized protocols to pursue efficiency of care and allow comparability of health outcomes and costs among them. Improving the performance of FVG and Italian hospitals requires investment in primary care services.

Projected Medicare Savings Associated With Lowering the Risk of Total Hip Arthroplasty Revision: An Administrative Claims Data Analysis

In the United States, demand for total hip arthroplasty (THA) and THA revision procedures are increasing due to an aging population, a longer life expectancy, and an increasing prevalence of osteoarthritis. This retrospective cohort study identified patients 65 years and older in the Medicare 5% Standard Analytic Files who underwent THA for osteoarthritis between January 1, 2009, and September 30, 2010. The authors estimated the 5-year cumulative revision risk (CRR) using the Kaplan-Meier method, revision-related complications, and Medicare expenditures. Using a 6.22% compound annual growth rate from the Healthcare Cost and Utilization Project of the Agency for Healthcare Research and Quality, the authors estimated the number of THAs that will be performed from 2018 to 2027 and calculated the 10-year projected savings to Medicare for a 1% reduction in CRR. Among 7820 patients, the mean age was 74.4 years, and 62.4% were female. Cumulative revision risk was 4.2% at 5 years (through September 30, 2015), with 30.8% of revisions occurring within 90 days of the THA. At least 24.4% of revision patients had a complication. Median revision inpatient stay and episode of care (through 90 days) expenditures were $23,847 and $36,157, respectively. With a 1% absolute reduction in CRR, Medicare could save $697 million over a 10-year period, or $985 million when including Medicare Advantage, which represented 29.2% of 2016 Medicare payments. Strategies to reduce the risk of THA revision, such as the use of implant constructs with lower CRR and value-based payment models, are needed to achieve Medicare payment reductions while maintaining or improving quality of care for Medicare beneficiaries. [Orthopedics. 2019; 42(1):e86-e92.].

Patient-Administered Biologic and Biosimilar Filgrastim May Offer More Affordable Options for Patients with Nonmyeloid Malignancies Receiving Chemotherapy in the United States: A Budget Impact Analysis from the Payer Perspective

BACKGROUND

Granulocyte colony-stimulating factors (G-CSFs) are often administered to reduce the incidence, severity, and duration of febrile neutropenia (FN) in chemotherapy patients. Tbo-filgrastim and filgrastim-sndz represent a follow-on biologic and a biosimilar version, respectively, of the short-acting G-CSF filgrastim with comparable efficacy and safety.

OBJECTIVE

To estimate the budget impact of increasing use of patient-(home-) administered tbo-filgrastim and filgrastim-sndz from a U.S. payer perspective.

METHODS

An interactive budget impact model was developed to estimate the changes in drug cost associated with projected increases in the market share of tbo-filgrastim from 5% to 10% and of filgrastim-sndz from 10% to 12% (with a corresponding decrease in filgrastim market share from 85% to 78%) for a 1 million-member health plan among patients with nonmyeloid malignancies receiving chemotherapy with a high risk of FN. Patient self-administration at home was assumed for 20% of patients receiving short-acting G-CSF treatment; all products were purchased through the patient's pharmacy benefit and were assumed to have tier 3 formulary status with a patient copay of $54 per prescription. Base-case data were derived from publicly available resources. The total plan budget impact was calculated using a 1-year time horizon, along with the differences in per member per month and per member per year (PMPY) costs between the current and future scenarios.

RESULTS

The effective annual per-patient drug cost to the plan totaled between $16,961 and $27,199, depending on dosage and packaging, for tbo-filgrastim; between $16,216 and $26,015 for filgrastim-sndz; and between $19,134 and $30,663 for filgrastim. The estimated total annual plan cost associated with patient-administered short-acting G-CSFs was $53,298,217 (PMPY = $53.30) in the current scenario and $52,828,832 (PMPY = $52.82) in the future scenario. Cost savings totaled $469,385 (PMPY = $0.48). The model was most sensitive to changes in the percentage of patients self-administering G-CSF at home and to the wholesale acquisition cost for filgrastim.

CONCLUSIONS

The effective annual plan per-patient drug costs for tbo-filgrastim and filgrastim-sndz were 11% and 15% lower than filgrastim, respectively. The present analysis estimated an annual U.S. health plan cost savings approaching $0.5 million following increases in market shares of approximately 5% for tbo-filgrastim and 2% for filgrastim-sndz.

DISCLOSURES

This study was sponsored by Teva Branded Pharmaceutical Products R & D, which participated in the study design, data interpretation and analysis, the writing of the report, and the decision to submit. Aventine Consulting received consulting fees from Teva Pharmaceuticals and developed the cost model and provided data analysis support. Trautman and James are employed by Aventine Consulting. Szabo and Tang are employed by Teva Pharmaceuticals.

Potential for Cost Saving with Iclaprim Owing to Avoidance of Vancomycin-Associated Acute Kidney Injury in Hospitalized Patients with Acute Bacterial Skin and Skin Structure Infections

BACKGROUND AND OBJECTIVE

Vancomycin is the most prescribed antibiotic for hospitalized adults with skin and skin structure infections. Vancomycin is associated with acute kidney injury. Iclaprim is an antibiotic under development for the treatment of patients with acute bacterial skin and skin structure infections and is not associated with acute kidney injury. This economic model sought to determine the potential cost saving with iclaprim owing to avoidance of vancomycin-associated acute kidney injury among hospitalized patients with acute bacterial skin and skin structure infections.

MATERIALS AND METHODS

A hospital cost-minimization model was developed to estimate the overall cost impact of replacing empiric vancomycin with iclaprim among hospitalized adult patients with skin and skin structure infections. The structural model included: vancomycin acquisition; vancomycin assay; incidence of vancomycin-associated acute kidney injury; excess hospital length of stay if acute kidney injury occurred; frequency/cost of specialty physician consults after occurrence of acute kidney injury; and probability/cost of acute dialysis as a result of acute kidney injury. Iclaprim treatment duration was 7 days and iclaprim acquisition cost was varied to determine the upper end of the daily iclaprim price that still conferred cost savings relative to vancomycin. Duration of hospitalization for iclaprim was assumed to be the same as patients with no acute kidney injury.

RESULTS

Based on the overall acute kidney injury rate (9.2%), the neutral acquisition price threshold for iclaprim vs. vancomycin was US$1373.47/regimen. Across various subpopulations where acute kidney injury risk ranged between 9.2 and 16.7%, the daily iclaprim acquisition cost that still conferred cost savings was up to US$300/day.

CONCLUSIONS

Iclaprim has the potential to reduce the economic burden of acute bacterial skin and skin structure infections in hospitalized patients at risk for vancomycin-associated acute kidney injury when iclaprim acquisition is US$300/day or less.

Cost variation and savings opportunities in the Oncology Care Model

OBJECTIVES

This study seeks to identify service categories that present the greatest opportunities to reduce spending in oncology care episodes, as defined by the CMS Oncology Care Model (OCM). Regional variation in spending for similar patients is often interpreted as evidence that resources can be saved, because higher-spending regions could achieve savings by behaving more like their lower-spending counterparts.

STUDY DESIGN

We used Surveillance, Epidemiology, and End Results Medicare data from 2006-2013 for this retrospective observational cohort study. Analysis focused on patients with non-small cell lung cancer, advanced (stage III or IV) breast cancer, renal cell carcinoma, multiple myeloma, or chronic myeloid leukemia.

METHODS

Episodes were identified for patients with the 5 included cancers, following the episode definition used in the OCM. We estimated standardized episode-level spending for a standard patient across subcategories of care for each hospital referral region (HRR) defined by the Dartmouth Atlas. The contribution of each subcategory to interregional variation in total spending reflects that subcategory's potential to yield savings.

RESULTS

Chemotherapy and acute inpatient hospital care tended to be the highest contributors to interregional variation. Imaging, nonchemotherapy Part B drugs, physician evaluation and management services, and diagnostics were negligible contributors to interregional variation for all 5 cancers.

CONCLUSIONS

Chemotherapy and inpatient hospital care offer the most potential to reduce spending within OCM-defined episodes. Other sources of savings differ by type of cancer. Assuming patient outcomes are not compromised, low-spending HRRs may be models for lowering cost in cancer care.

Lean leadership attributes: a systematic review of the literature

Purpose

Emphasis on quality and reducing costs has led many health-care organizations to reconfigure their management, process, and quality control infrastructures. Many are lean, a management philosophy with roots in manufacturing industries that emphasizes elimination of waste. Successful lean implementation requires systemic change and strong leadership. Despite the importance of leadership to successful lean implementation, few researchers have probed the question of ideal leadership attributes to achieve lean thinking in health care. The purpose of this paper is to provide insight into applicable attributes for lean leaders in health care.

Design/methodology/approach

The authors systematically reviewed the literature on principles of leadership and, using Dombrowski and Mielke’s (2013) conceptual model of lean leadership, developed a parallel theoretical model for lean leadership in health care.

Findings

This work contributes to the development of a new framework for describing leadership attributes within lean management of health care.

Originality/value

The summary of attributes can provide a model for health-care leaders to apply lean in their organizations.

A National Budget Impact Analysis of a Specialised Surveillance Programme for Individuals at Very High Risk of Melanoma in Australia

BACKGROUND

Specialised surveillance using total body photography and digital dermoscopy to monitor people at very high risk of developing a second or subsequent melanoma has been reported as cost effective.

OBJECTIVES

We aimed to estimate the 5-year healthcare budget impact of providing specialised surveillance for people at very high risk of subsequent melanoma from the perspective of the Australian healthcare system.

METHODS

A budget impact model was constructed to assess the costs of monitoring and potential savings compared with current routine care based on identification of patients at the time of a melanoma diagnosis. We used data from a published cost-effectiveness analysis of specialised surveillance, and Cancer Registry data, to estimate the patient population and healthcare costs for 2017-2021.

RESULTS

When all eligible patients, estimated at 18% of patients with melanoma diagnosed annually in Australia, received specialised surveillance rather than routine care, the cumulative 5-year cost was estimated at $93.5 million Australian dollars ($AU) ($US 64 million) for specialised surveillance compared with $AU 120.7 million ($US 82.7 million) for routine care, delivering savings of $AU 27.2 million ($US 18.6 million). With a staggered introduction of 60% of eligible patients accessing surveillance in year 1, increasing to 90% in years 4 and 5, the cumulative cost over 5 years was estimated at $AU 98.1 million ($US 67.2 million), amounting to savings of $AU 22.6 million ($US 15.5 million) compared with routine care.

CONCLUSIONS

Specialised melanoma surveillance is likely to provide substantial cost savings for the Australian healthcare system.

Impact of trained oncology financial navigators on patient out-of-pocket spending

OBJECTIVES

Patients with cancer often face financial hardships, including loss of productivity, high out-of-pocket (OOP) costs, depletion of savings, and bankruptcy. By providing financial guidance and assistance through specially trained navigators, hospitals and cancer care clinics may be able mitigate the financial burdens to patients and also minimize financial losses for the treating institutions.

STUDY DESIGN

Financial navigators at 4 hospitals were trained through The NaVectis Group, an organization that provides training to healthcare staff to increase patient access to care and assist with OOP expenses. Data regarding financial assistance and hospital revenue were collected after instituting these programs.

METHODS

Amount and type of assistance (free medication, new insurance enrollment, premium/co-pay assistance) were determined annually for all qualifying patients at the participating hospitals.

RESULTS

Of 11,186 new patients with cancer seen across the 4 participating hospitals between 2012 and 2016, 3572 (32%) qualified for financial assistance. They obtained $39 million in total financial assistance, averaging $3.5 million per year in the 11 years under observation. Patients saved an average of $33,265 annually on medication, $12,256 through enrollment in insurance plans, $35,294 with premium assistance, and $3076 with co-pay assistance. The 4 hospitals were able to avoid write-offs and save on charity care by an average of $2.1 million per year.

CONCLUSIONS

Providing financial navigation training to staff at hospitals and cancer centers can significantly benefit patients through decreased OOP expenditures and also mitigate financial losses for healthcare institutions.

Scale Effects and Expected Savings from Consolidation Policies of Italian Local Healthcare Authorities

BACKGROUND

Consolidation is often considered by policymakers as a means to reduce service delivery costs and enhance accountability.

OBJECTIVE

The aim of this study was to estimate the potential cost savings that may be derived from consolidation of local health authorities (LHAs) with specific reference to the Italian setting.

METHODS

For our empirical analysis, we use data relating to the costs of the LHAs as reported in the 2012 LHAs' Income Statements published within the New Health Information System (NSIS) by the Ministry of Health. With respect to the previous literature on the consolidation of local health departments (LHDs), which is based on ex-post-assessments on what has been the impact of the consolidation of LHDs on health spending, we use an ex-ante-evaluation design and simulate the potential cost savings that may arise from the consolidation of LHAs.

RESULTS

Our results show the existence of economies of scale with reference to a particular subset of the production costs of LHAs, i.e. administrative costs together with the purchasing costs of goods (such as drugs and medical devices) as well as non-healthcare-related services.

CONCLUSIONS

The research findings of our paper provide practical insight into the concerns and challenges of LHA consolidations and may have important implications for NHS organisation and for the containment of public healthcare expenditure.

Estimated Cost Savings: Everyone With Diabetes Counts (EDC) Program

Everyone with Diabetes Counts (EDC) is a national disparities reduction program funded by the Centers for Medicare & Medicaid Services to improve outcomes in the underserved minority, diverse, and rural populations. This analysis evaluates West Virginia's pilot program of diabetes self-management education (DSME), one component of EDC. We frequency-matched 422 DSME completers to 1688 others by demographics and enrollment from Medicare fee-for service claims. We estimated savings associated with reduced hospitalizations in multivariable negative binomial models. DSME completers had 29% fewer hospitalizations (adjusted P < .0069). We estimated savings of $35 900 per 100 DSME completers in West Virginia.

A novel approach to improving efficiency and cost saving in preoperative blood preparation

BACKGROUND

Preoperative ordering of blood products has been an area of optimization due to considerable variability among physicians; overpreparation can lead to extra costs and underpreparation of blood can potentially compromise patient safety.

STUDY DESIGN AND METHODS

We examined the potential cost savings of extending the storage interval of a presurgical type-and-screen sample from 7 to 14 days, thereby reducing the need for a new specimen on the day of surgery.

RESULTS

Sensitivity analysis showed annual cost savings for our institution to be an estimated $38,770 ($22,420-$73,120).

CONCLUSION

These results are even more robust when incorporating the additional potential savings from improved operating room efficiency.

Comparing Generic Drug Markets in Europe and the United States: Prices, Volumes, and Spending

Policy Points: Our study indicates that there are opportunities for cost savings in generic drug markets in Europe and the United States. Regulators should make it easier for generic drugs to reach the market. Regulators and payers should apply measures to stimulate price competition among generic drugmakers and to increase generic drug use. To meaningfully evaluate policy options, it is important to analyze historical context and understand why similar initiatives failed previously.

CONTEXT

Rising drug prices are putting pressure on health care budgets. Policymakers are assessing how they can save money through generic drugs.

METHODS

We compared generic drug prices and market shares in 13 European countries, using data from 2013, to assess the amount of variation that exists between countries. To place these results in context, we reviewed evidence from recent studies on the prices and use of generics in Europe and the United States. We also surveyed peer-reviewed studies, gray literature, and books published since 2000 to (1) outline existing generic drug policies in European countries and the United States; (2) identify ways to increase generic drug use and to promote price competition among generic drug companies; and (3) explore barriers to implementing reform of generic drug policies, using a historical example from the United States as a case study.

FINDINGS

The prices and market shares of generics vary widely across Europe. For example, prices charged by manufacturers in Switzerland are, on average, more than 2.5 times those in Germany and more than 6 times those in the United Kingdom, based on the results of a commonly used price index. The proportion of prescriptions filled with generics ranges from 17% in Switzerland to 83% in the United Kingdom. By comparison, the United States has historically had low generic drug prices and high rates of generic drug use (84% in 2013), but has in recent years experienced sharp price increases for some off-patent products. There are policy solutions to address issues in Europe and the United States, such as streamlining the generic drug approval process and requiring generic prescribing and substitution where such policies are not yet in place. The history of substitution laws in the United States provides insights into the economic, political, and cultural issues influencing the adoption of generic drug policies.

CONCLUSIONS

Governments should apply coherent supply- and demand-side policies in generic drug markets. An immediate priority is to convince more physicians, pharmacists, and patients that generic drugs are bioequivalent to branded products. Special-interest groups continue to obstruct reform in Europe and the United States.

Strategies to manage costs in idiopathic pulmonary fibrosis

Idiopathic pulmonary fibrosis (IPF) is a diagnostically challenging disease. Clinicians are faced with the need to exclude alternative diagnoses, limited treatment and management guidelines, and few treatment options. Patients with IPF have significantly increased healthcare usage compared with similar patients without the disease. Medicare estimates for this disease are as high as $3 billion, not including cost of treatment. The disease, characterized by worsening dyspnea, declining lung function, nonspecific respiratory symptoms, and a varied clinical course randomly punctuated by episodes of acute exacerbations, is also accompanied by a host of comorbid conditions that contribute significantly to increased healthcare usage and cost. The comorbidities, which increase impairment and disability, and compromise patient quality of life and survival, include pulmonary and cardiac conditions, sleep apnea, gastroesophageal reflux disease, depression and anxiety, and lung cancer. Until recently, palliative care and lung transplant were the only options for management of IPF. Without a lung transplant, the median survival was estimated at 3 to 5 years from the initial diagnosis. Newer treatments, pirfenidone and nintedanib, demonstrate a modest effect on slowing decline in lung function in patients with IPF. Both were approved for the treatment of IPF in 2014. As potentially effective therapies emerge, attention should be given to healthcare resource usage and healthcare processes that ensure patient-centered management with sustainable, cost-effective, and quality care. As such, it is imperative that a structured, comprehensive, multidisciplinary management approach is used in the treatment and management of IPF and its associated comorbidities to limit costs and provide effective and quality healthcare.

Performance of a Condensed Protocol That Reduces Effort and Cost of NIA-AA Guidelines for Neuropathologic Assessment of Alzheimer Disease

Concerns regarding resource expenditures have been expressed about the 2012 NIA-AA Sponsored Guidelines for neuropathologic assessment of Alzheimer disease (AD) and related dementias. Here, we investigated a cost-reducing Condensed Protocol and its effectiveness in maintaining the diagnostic performance of Guidelines in assessing AD, Lewy body disease (LBD), microvascular brain injury, hippocampal sclerosis (HS), and congophilic amyloid angiopathy (CAA). The Condensed Protocol consolidates the same 20 regions into 5 tissue cassettes at ∼75% lower cost. A 28 autopsy brain-retrospective cohort was selected for varying levels of neuropathologic features in the Guidelines (Original Protocol), as well as an 18 consecutive autopsy brain prospective cohort. Three neuropathologists at 2 sites performed blinded evaluations of these cases. Lesion specificity was similar between Original and Condensed Protocols. Sensitivities for AD neuropathologic change, LBD, HS, and CAA were not substantially impacted by the Condensed Protocol, whereas sensitivity for microvascular lesions (MVLs) was decreased. Specificity for CAA was decreased using the Condensed Protocol when compared with the Original Protocol. Our results show that the Condensed Protocol is a viable alternative to the NIA-AA guidelines for AD neuropathologic change, LBD, and HS, but not MVLs or CAA, and may be a practical alternative in some practice settings.

Time-driven activity-based costing: A dynamic value assessment model in pediatric appendicitis

OBJECTIVES

Healthcare reform policies are emphasizing value-based healthcare delivery. We hypothesize that time-driven activity-based costing (TDABC) can be used to appraise healthcare interventions in pediatric appendicitis.

METHODS

Triage-based standing delegation orders, surgical advanced practice providers, and a same-day discharge protocol were implemented to target deficiencies identified in our initial TDABC model. Post-intervention process maps for a hospital episode were created using electronic time stamp data for simple appendicitis cases during February to March 2016. Total personnel and consumable costs were determined using TDABC methodology.

RESULTS

The post-intervention TDABC model featured 6 phases of care, 33 processes, and 19 personnel types. Our interventions reduced duration and costs in the emergency department (-41min, -$23) and pre-operative floor (-57min, -$18). While post-anesthesia care unit duration and costs increased (+224min, +$41), the same-day discharge protocol eliminated post-operative floor costs (-$306). Our model incorporating all three interventions reduced total direct costs by 11% ($2753.39 to $2447.68) and duration of hospitalization by 51% (1984min to 966min).

CONCLUSION

Time-driven activity-based costing can dynamically model changes in our healthcare delivery as a result of process improvement interventions. It is an effective tool to continuously assess the impact of these interventions on the value of appendicitis care.

LEVEL OF EVIDENCE

II, Type of study: Economic Analysis.

Consensus recommendations on exploring effective solutions for the rising cost of diabetes

Diabetes remains asymptomatic for a long period of time and its real burden gets noticed only once the complications set in. The number of individuals affected with the disease is also on the rise and more so in the low income countries. This scenario calls for urgent precautionary measures that need to be undertaken to equip ourselves to fight against this chronic disease. Individuals with financial constraints cannot afford to access even the basic treatment facilities and thus stands the most burdened. The International Diabetes Federation calls for 'Eyes on Diabetes' for the society to focus on early screening and early intervention. The rising cost of diabetes results from delayed and denied treatment. The panel discussion organized as a part of 4th Annual global diabetes convention of Jothydev's Professional Education Forum (JPEF, 2016) facilitated a platform to address diabetes as a serious health concern that needs to be given immediate priority by the policymakers as well as public and also to discuss about the feasible measures that will help achieve cost effective and affordable diabetes treatment. This was followed by in-depth literature search and finally a set of recommendations have been arrived at by the key opinion leaders to realize the dream of affordable diabetes care to all deserving individuals.

Determinants of success in Shared Savings Programs: An analysis of ACO and market characteristics

BACKGROUND

Medicare's Accountable Care Organization (ACO) programs introduced shared savings to traditional Medicare, which allow providers who reduce health care costs for their patients to retain a percentage of the savings they generate.

OBJECTIVE

To examine ACO and market factors associated with superior financial performance in Medicare ACO programs.

METHODS

We obtained financial performance data from the Centers for Medicare and Medicaid Services (CMS); we derived market-level characteristics from Medicare claims; and we collected ACO characteristics from the National Survey of ACOs for 215 ACOs. We examined the association between ACO financial performance and ACO provider composition, leadership structure, beneficiary characteristics, risk bearing experience, quality and process improvement capabilities, physician performance management, market competition, CMS-assigned financial benchmark, and ACO contract start date. We examined two outcomes from Medicare ACOs' first performance year: savings per Medicare beneficiary and earning shared savings payments (a dichotomous variable).

RESULTS

When modeling the ACO ability to save and earn shared savings payments, we estimated positive regression coefficients for a greater proportion of primary care providers in the ACO, more practicing physicians on the governing board, physician leadership, active engagement in reducing hospital re-admissions, a greater proportion of disabled Medicare beneficiaries assigned to the ACO, financial incentives offered to physicians, a larger financial benchmark, and greater ACO market penetration. No characteristic of organizational structure was significantly associated with both outcomes of savings per beneficiary and likelihood of achieving shared savings. ACO prior experience with risk-bearing contracts was positively correlated with savings and significantly increased the likelihood of receiving shared savings payments.

CONCLUSIONS

In the first year, performance is quite heterogeneous, yet organizational structure does not consistently predict performance. Organizations with large financial benchmarks at baseline have greater opportunities to achieve savings. Findings on prior risk bearing suggest that ACOs learn over time under risk-bearing contracts.

IMPLICATIONS

Given the lack of predictive power for organizational characteristics, CMS should continue to encourage diversity in organizational structures for ACO participants, and provide alternative funding and risk bearing mechanisms to continue to allow a diverse group of organizations to participate.

LEVEL OF EVIDENCE

III.

Do hospital mergers reduce costs?

Proponents of hospital consolidation claim that mergers lead to significant cost savings, but there is little systematic evidence backing these claims. For a large sample of hospital mergers between 2000 and 2010, I estimate difference-in-differences models that compare cost trends at acquired hospitals to cost trends at hospitals whose ownership did not change. I find evidence of economically and statistically significant cost reductions at acquired hospitals. On average, acquired hospitals realize cost savings between 4 and 7 percent in the years following the acquisition. These results are robust to a variety of different control strategies, and do not appear to be easily explained by post-merger changes in service and/or patient mix. I then explore several extensions of the results to examine (a) whether the acquiring hospital/system realizes cost savings post-merger and (b) if cost savings depend on the size of the acquirer and/or the geographic overlap of the merging hospitals.

St. Michael's Improvement Program - A Collaborative Approach to Sustainable Cost Savings

In response to a challenging financial environment and increasing patient demand, St. Michael's Hospital needed to find long-term sustainable solutions to continue to provide high-quality patient care and invest in key priorities. By conducting Operational Reviews in focused areas, the hospital achieved $7.4 million of in-year savings in the first year, found standardizations, process efficiencies and direct cost savings that positioned itself for success in future funding models. Initiatives were grounded in evidence and relied heavily on the effective execution by the leadership, front-line staff and physicians. As organizations face similar challenges, this journey can provide key learnings.

[Not Available]

Zusammenfassung. Diagnose-bezogene Fallgruppen, DRGs, sind eines der seit den 1960er in den USA entwickelten und erstmals 1983 zu Abrechnungszwecken eingeführten Patientenklassifikationssysteme, die den Anspruch erheben, klinisch ähnliche Fälle, die ähnlich teuer sind, zwecks einer erhöhten Vergleichbarkeit zusammenzufassen. Die Hauptziele, welche mit der Einführung von DRGs zu Abrechnungszwecken verfolgt werden, sind einerseits eine Erhöhung der Transparenz der erbrachten Leistungen, sowie andererseits eine Steigerung der Effizienz durch die pauschale Rückvergütung des durchschnittlichen Aufwands der Fälle der selben DRG. In der Schweiz werden seit 2012 sämtliche stationäre, akut-somatische Fälle über DRGs abgerechnet. Obwohl einige Befürchtungen nicht objektiviert werden konnten, haben sich andere bestätigt.

New Hampshire Nurse Practitioners Take the Lead in Forming an Accountable Care Organization

In 2012, New Hampshire nurse practitioners (NPs), along with Anthem Blue Cross/Blue Shield, formed the first Patient Centered Shared Savings Program in the nation, composed of patients managed by nurse practitioners employed within NP-owned and operated clinics. In this accountable care organization (ACO), NP-attributed patients were grouped into one risk pool. Data from the ACO and the NP risk pool, now in its third year, have produced compelling statistics. Nurse practitioners participating in this program have met or exceeded the minimum scores for 29 quality metrics along with a demonstrated cost-savings in the first 2 years of the program. Hospitalization rates for NP-managed patients are among the lowest in the state. Cost of care for NP-managed patients is $66.85 less per member per month than the participating physician-managed patients. Data from this ACO provide evidence that NPs provide cost-effective, quality health care and are integral to the formation and sustainability of any ACO.

Application of Lean Methodology for Improved Quality and Efficiency in Operating Room Instrument Availability

Advances in surgical instrumentation allow surgeons to treat patients with less morbidity and shorter recovery time. However, the increasing complexity also adds to surgical risk, and to operating room supply chain burden. To improve the quality and efficiency of operating room instrument availability, we developed and validated a Lean 5S approach consisting of sort (determining instrument usage and waste), simplify (removing unnecessary instruments), sweep (confirm availability of needed instruments), standardize (all trays the same for a given procedure), and self-discipline (monitor success). The primary outcome was reduction in unnecessary instruments delivered to the operating room. As a secondary analysis, we evaluated the effect of the Lean instrument intervention on surgery times. We reduced the number of instruments for minimally invasive spine surgery by 70% (from 197 to 58), and setup time decreased 37% (13.1-8.2 min, p = .0015). We also report subsequent validation of the approach on deep brain stimulator cases. We conclude that complex surgical procedures offer opportunities for substantial waste reduction, simplification, and quality improvement, with potential institutional annual cost savings of $2.8 million. We demonstrate that Lean methodology can improve quality at lower cost.

Saving Money On Meds Cut your Rx costs with these tips

With insurance deductibles and co-pays rising for some prescription medications and supplies, staying healthy is becoming more expensive for people with diabetes. But there are ways to trim costs without skimping on necessities. Start by being proactive and candid with your providers. Let your doctor, pharmacist, and diabetes educator know if there was an unexpected increase in your co-pay or if you need help paying for your prescriptions and supplies. They might point you toward free samples, discount coupons, and vouchers offered by pharmaceutical companies and device manufacturers. Read on for other cost- cutting tips.