Saturday, November 6, 2010

My relocation - both physically and virtually

I relocated to Russia - and my blog to a new website.

Physically, I followed my wife to the wonderful little town of Sochi in Russia's south. I've been here before in the summer of 2008, but now I am going to spend almost an entire academic year here.

As you can see, Sochi lies on the east shore of the Black Sea and just north of Georgia.
Most of the following is courtesy my wife: Sochi is the most beloved domestic vacation destination among Russian (as it was among Eastern Europeans during Soviet times). The small strip among the coast line boasts the most northern subtropical climate in the world. This is why Stalin himself decided to develop this town as the "Russian Rivera"; he had his own dacha here as well. The town become a "Kurort", a spa town, with many sanatoria and resorts. If you drive into the nearby Caucasian mountains, however, it quickly becomes chilly. They do grow tea there since it's very sunny (again, the most Northern spot). The legend goes that you can swim in the sea and ski in the mountains on the same day.
Sochi won the bid for the 2014 Winter Olympics which will take place not far from here and at least some people are very excited about this. There is lots of construction going on and, sadly, there is a lot of traffic. Fortunately, we live near a river, on a very leafy street. In fact, the entire city is very green.
Of course, Russia is very different in many ways from Western countries. Here are just a few things: Our hosts are incredibly nice. On the other hand, people on the street are rather reserved and sometimes even mean. It seems that once you know someone, it's a completely different story. The tea and the food are wonderful. The bureaucracy is terrible. To exchange something in a store can take hours, if it is possible at all.
My wife is doing research here while I am "telecommuting" to my research collaborations via Skype and the like.
In short, it is very interesting to be here!

A resort in Sochi, Russia, ca. 1909 (from Wikipedia)

My blog "Value Strategies" relocated to a new address, Actually, I slightly changed the title to "Health Care Value Strategies". I moved on from Google Sites and Blogger to a hosted Wordpress installation on an Amazon EC2 instance, as per Sean's suggestion. I hope this little guy can handle the little traffic I had on the previous sites so far,  about 4,200 page views from  roughly 430 absolute unique visitors. The installation was relatively painless although I am certainly not very familiar (yet) with many of the components, Unix, MySQL, PHP and what not.

I hope you bookmark or subscribe to the RSS feed. If you click on the link, you'll get to a feedburner page where you can chose your reader (for example, I use Google Reader). If you were on the feedburner feed previously, you don't have to change anything. If you're on the feed, please switch. The safest thing is to visit the RSS feed and subscribe again.
You can also chose email notifications there if you prefer that.
If you have any feedback for me, some hints how to make the website and blog better (either the site or the content), or a tip what I could cover, I would love to hear from you. For example, I am still looking for a good theme. Send me an email or comment on each of the posts.

Now that I've relocated, I am going to start posting more frequently.

Best regards Sochi, Russia and!


Thursday, October 14, 2010

Publication Duty for Pharmaceuticals?

Cross-posted at PLoS Blog's "Speaking Medicine

A recent case of publication bias fuels the debate over if results of clinical studies sponsored by pharmaceutical companies must be published in European countries. I have become interested in this issue since researching for an editorial in Value in Health about a similar problem in studies assessing the health-related quality of life.

Researchers at IQWIG, Germany's NICE equivalent, did not cave in when they could not get their hands on the unpublished results of clinical trials of the selective norepinephrine reuptake inhibitor reboxetine (an anti-depressant, branded as Edronax(R), Norebox(R), Davedax(R), or Vestra(R)) for major unipolar depression. Instead, they asked the manufacturer Pfizer time and again for the unpublished data (the drug was developed in the 1990s by Pharmacia which merged with Pfizer in 2003).

The drug was approved by European drug regulatory agency EMEA in 1997, but only conditionally approved by the U.S. equivalent FDA in 1999. In 2001, the FDA declined a final approval on the grounds of insufficient evidence for its efficacy.

A new systematic review with meta-analysis published by BMJ displays the striking difference between the  published and the unpublished trials: the Forrest plot in figure 6 shows that taking reboxetine did not result in a significantly better response or remission in the unpublished or the total combined results (they were significantly different in the published ones). Withdrawal was also more likely than placebo only in the combined results.
In the spirit of comparative effectiveness research, the performance of reboxetine was compared to SSRIs, a major class of antidepressants. Response, remission, and withdrawal all were worse. Results were not compared to tricyclics or other drug classes. However, it should be noted that even within the class of SSRIs, they are differences in efficacy and acceptance. To this day, it is still not clear how psychiatrist can best find the most suitable drug for an individual. Interpersonal differences, pharmacogenetics and proteomics might play a role in different responses. In any event, this is a beautiful execution of a meta-analysis and highlights the value of this study type well.

It is shocking that this useless and possibly harmful medication was on the German (as well as other European markets) for well over a decade while it was withdrawn in the U.S. about nine years ago. EMEA seems not to have made the best decision back in 1997. Re-evaluations based on efficacy (other than safety) concerns remain difficult.

IQWIG said in a press release, that Pfizer only provided the data under "massive public pressure". Along with their original research, they describe in BMJ the back and forth with Pfizer in a "Tale of Hide and Seek". The press release goes a bit further than the companion article. It mentions a draft for a German "Law on the Reorganization of the Pharmaceutical Market". This bill would stipulate mandatory publication of studies by the pharmaceutical companies. However, you have to go to the actual text to understand that posting raw data on the internet would suffice. Why not a European requirement? In the US, there is an analogous rule; all clinical trial data of studies after September 27, 2007 must be published on The value of such transparency for patients, payors, and society at large could not be more obvious.

Sunday, August 29, 2010

Postcard from Hawaii

Do you know these "postcards from XYZ" in The New Yorker which turn out to be long essays? Well, this is clearly not one of those. I just wanted to let you know that I have been in Hawaii, on the island Kauai to be precise, for the past few weeks. Hawaii is one of the states that is frequently cited as a model for health care reform since almost anybody here has health insurance, just like Massachusetts where I have been based for the past four years. However, there is one difference in that health care utilitzation here in Hawaii is lower and people seem to be healthier -- so I thought I'd pop in for a visit. Kidding, I have been here for a multi-week, European-style vacation. But why are people so healthy here? Is it the fresh air and the open-air architecture (which resembles other Pacific islands, as my wife remarks)? Or is it the healthy life style, lots of surfing etc.? Or could it be the diet? Actually, the diet seemed not particularly healthy, except for the higher amounts of fish. On the question of why people on one of the Southern-most Japanese islands, Okinawa, life so long (many around a hundred years!), there has been much attention. In any case, I hope to have caught the more positive influences, including some downtime. And after ending my vacation today, I will resume blogging about my observations on value strategies for health care after flying home. Please feel free to "subscribe to updates" on your right or by clicking here. Mahalo! (thank you in Hawaiian)

Thursday, August 12, 2010

Talk on Costs/Value

Today I was invited today to give a talk at MIT / HST's Laboratory for Computational Physiology. The topic was costs, but I tried to tweak the talk a little towards value. Here are my slides.

Friday, July 30, 2010

New Books: On the Mend & Laugh, Sing, and Eat Like a Pig

I received review copies of two new books:
You can buy "On the Mend" either from amazon or the Lean Enterprise Institute book store. The price is the same (except you get a bulk discount from LEI when ordering 10 or more copies; shipping might be free on amazon; they also have a Kindle edition).

Dave's Book is on amazon.

I will post reviews as soon as I'm through them.

Saturday, July 17, 2010

FDA Comparing Diabetes Drugs?

One of the task's of the U.S. Food and Drug Administration (FDA) is to approve novel drugs. It has often been mentioned that drugs are not compared to each other head-to-head, as would be desirable for comparative effectiveness. Mostly, drugs are still compared to placebo.

However, the FDA is also responsible for pulling unsafe drugs off the markets. And in doing so, the FDA has one means of comparing the risks of particular drug to competing drugs.

Example: Recently, the FDA has investigated whether taking the diabetes drug Avandia(R) (rosaglitazone) is associated with an increased risk for myocardial infaction (heart attack). After an FDA panel recommended to pull the drug (here's a Kaiser Health News summary for advisory board meeting), the agency still decided to keep it on the market. What's interesting, however, is that the committee was flipping back and forth over the decision amidst the various aspects: efficacy, safety, and also competing drugs. A blog post by the NY Time's Precription blog chronicles the course of the meeting. Most interestingly, in the 1:17 pm entry, a Dr. Robert Temple stated that the FDA is supposed to pull drugs if "it’s nearly identical with another drug that doesn’t have such a serious safety problem". An example cited was Seldane(R) (terfenadine), an anti-histamine that was pulled because it may arrhythmias and there were competitor products without that safety issue on the market.

So if adverse events are part of the effectiveness considerations, this means that the FDA actually does have a way of assessing if not the benefits then at least the risks.

Sunday, July 11, 2010

The Value of Don Berwick at CMS

Today I am offering a little more opinion than usual; this just as a disclaimer upfront. I want to talk about the recess appointment of Don Berwick as administrator of the Centers for Medicare & Medicaid Services (CMS) and the potential value for patients attached to this appointment.

The Appointment
As you've probably heard, President Obama appointed him during a recess of congress, which means that we will not have to be confirmed. There has been a lot of outrage about this in the media and the blogosphere since it would be more democratic if congress has a say in who runs a Federal agency that spends hundreds of billions of dollars each year. However, there were concerns that the Republicans in congress would have blocked Berwick or significantly delayed his appointment (of note, CMS has been without a real leader since 2006). Interestingly, there were a few hundred recess appointments in the Bush years.

The Potential Value
CMS is in the midsts of changing standard to hold health care providers more accountable. For example, preventable conditions acquired such as falls, certain infections, pressure ulcers and "never-events" such as objects left in the body during surgery, air embolisms, and transfusion reactions due to blood incompatibilities. In 2012, a national program will be started to create "accountable care organizations" to ensure costs and quality, and it will be adminstered by - you guessed it - CMS (see Health Affairs article by Elliot Fischer and others with a proposal on the details).
However, it's not just Medicare and Medicaid which will finally (or I should say, hopefully) focus not just on quality but also on value; it will also benefit other health insurances purchasers including single individuals. The health care reform bill will lead to the creation of health insurance exchanges and "smart buys" by small businesses and individuals. As in coding/billing and coverage decision-making, CMS is expected to set standards for the whole industry.

The Candidate
Don Berwick has been called "healthcare’s most innovative and influential leader" (link). He has created and lead the Institute for Health Care Improvement which is empowering health care providers to improve their quality. Examples include national campaigns to drastically reduce if not completely eliminate ventilator-associated pneumonias and other hospital-acquired infections. As CMS (and other payors) are not paying for these now preventable infections, on top of the health benefits "bundles" like these are now also saving money for the providers. He is also known for his self-proclaimed extreme patient-centeredness; just read his recent address to the Yale Med School class of 2010. There are resources on Berwick and his accomplishments on the Kaiser Health News website.

My Conclusion
The White House said congress "[was] going to stall the nomination as long as they could, solely to score political points." Health care needs CMS with its purchasing power to implement promising solutions to not just increase the quality but ensure the value of health care that not just Mediare and Medicaid but all patients will receive from their providers. This will be hard without someone like Berwick at one of the central controls. I think the value of this recent appointment for patients will be enormous.

Friday, July 2, 2010

BP = #Lean ?

If BP was a hospital, they would have been shut down by the Joint Commission.

As @LeanBlog points out, a Wall Street Journal article called BP's operations on another oil platform in the Gulf of Mexico "lean".

Of course BP did not run a Toyota Production System-kind of lean operation. They did not employ "Five S", "Kanban" pull systems (to become a "just in time" company), or "poka-yoke" error proofing in order to increase their quality and safety.

What the WSJ authors Chazan, Faucon, and Casselman mean is that BP was running a low cost-low safety operation. 76% of the willful and almost 100% (760/761 in almost three years) of the "egregious willful" citations were issue to BP. If BP was a hospital, they would have been shut down by the Joint Commission a long time ago.

Not surprisingly, their efficiency, value, cost-effectiveness, however you want to call it was high. That's because the extra investment in safety (even after repeated citations, minor spills, a refinery explosion and probably many "near misses") did not shrink their profits and the shareholder value. Arguably, the latter are important measures that CEOs of publicly owned corporations are held accountable for on a daily or at least a quarterly basis.

They also did not value-map. Except that they did. They might have  looked at decision trees like this (with a little more details and figures):

A major spill is a rare event, even under comparatively low security measures. Therefore, you will only account for this scenario with the probability it occurs. You could make a major spill an even rarer event with investing in extra security.

However, here's the real kicker: under the current laws and regulations (which are probably going to be changed in light of the recent results), the liability of a major oil spill has been capped at $75 million! That means that in the model above, it's very clear that the "low cost, low safety" strategy is much more attractive, since you do not have to pay for the extra security (note that you would have to pay for this both in the event of a major spill or no major spill.

Is this was BP decided according to the currently enacted liability situation? If that's the case, then the lawmakers and regulators are partly to blame for the mess we have now!

Where is the analogy to health care?
It has been argued early on after the spill by President Obama and others that the relationship between the oil industry and their regulators has been to cozy. The Minerals Management Service, which belongs to the Department Interior, had clearly a conflict of interest as they both had to ensure the safety of oil drilling in Federal waters and at the same time cashed in on royalties from the oil industry.
Another Federal agency, the Food and Drug Administration also collects "user fees" from the pharmaceutical companies it is supposed to regulate. Another conflict of interest?

Tuesday, June 29, 2010

AG to Partners: Your report is flawed (too)

The Globe reports about and posts a PDF of a letter from Massachusetts' Attorney General Office (AGO) back to Partners Healthcare System (see my earlier post on their assessment). And they don't give back an inch!

The AGO claim that the Dreyer report for Partners confirms their findings, in particular that quality is not related to variation in charges. They also call their methods (bivariate models) "extensively vetted and corroborated" and "anything other than sound" and found "flaws and errors in [Dreyer's] methodology.

I still think that Dreyer's multivariate approach is better although he does not apply it to the real interesting question: quality and how it relates to charges. I think they should all dig deeper and neither of their report is at all acceptable.


Thursday, June 24, 2010

BP's Safety/PR and Health Care

It has been getting a little quieter around the oil spill in the Gulf of Mexico while the oil is now washed ashore Northwestern Florida (as predicted in this simulation). Time to think about how this situation compares to health care.

In health care, each year millions of mistakes are made. Some are trivial. Some are serious but caught before harm occurs (termed 'near misses'). Some are lethal. Some are thought to be unavoidable (thought they might not be).

Here is a single patient story. I am warning you: this quite a tough one to watch. To me, this is the perfect imperative for improvements in quality and safety.

Click here if you cannot see the video.

Lucian Leape, one of my professors at the Harvard School of Public Health, wrote in an 1994 JAMA article that an estimated 180,000 patients die every year from severe iatrogenic (that means: caused by health care providers, often in an attempt to cure or alleviate) adverse events, "the equivalent of three jumbo jet crashes every two days". Wow.

What does this have to do with BP's Safety and PR?
I think that both in oil spills and severe iatrogenic adverse events, the  perpetrator needs to apologize. The apology should occur early and be genuine. There should be no restricted areas; everything that happened should be studied and explained. Most importantly, the perpetrator should show how they plan to implement steps to prevent this or similar kinds of events from ever occurring again.
If BP took this to heart, they would be the safest and most transparent oil company five years down the road.

Tuesday, June 22, 2010

HC Value in Mass: AG vs. Partners

In late January of this year, the attorney general's office (AGO) released a report that was supposed to show that
  • charges to insurances vary significantly between providers within the same geographic area;
  • variations in charges are not explained by quality, case severity and complexity, Medicare or Medicaid proportion of the case mix, or teaching hospital status;
  • variations in charges are correlated to market leverage (relative market position compared with others);
  • variations in charges are not correlated to the payment scheme - expenses were "sometimes" higher for globally paid providers compared with fee-for-service basis; and that
  • increase in price, not in utilization, caused "most of the increases in health care costs during the past few years in Massachusetts".
A couple of days ago, Partners Healthcare released an analysis by Paul Dreyer, PhD, a consultant to Partners Healthcare who had worked at the Mass Department of Public Health for over twenty years before he retired. His reported has also been released via the internet. Dreyer finds that
  • the AGO's methods are inappropriate as they use cross-sectional studies and uni (bi) variate [regression] analyses;
  • using appropriate uni (bi) variate [regression] analyses, you get different results;
  • in a multivariate [regression] model about half of the variance (R2=0.53) is explicable by the following variables (directly copied from report):
    • "DSH Dummy - A dummy coded variable indicating a hospital’s DSH [disproportionate share (of patients paid for by government programs plus free care)hospitals] Status
    • GEO Dummy - A dummy coded variable indicating a hospitals status as small and geographically isolated (ADC <20, 20 miles or more to next hospital)
    • # Specialty Teaching Programs - From the ACGME, the number of accredited specialty teaching programs, or 0 if the hospital has no teaching program
    • Cost Per Day - From the RSC 403, total patient expenses including capital divided by total patient days
    • Case Mix Index - From the Report";
  • the leverage argument cannot sustained when looking at all hospitals (rather than only six selected ones);
  • a shift to hospitals with higher charges only explains 0.6% of the cost increase in 2005-8; and
  • there is a variation in quality between the hospitals, and that this variation "is comparable to the variation in price presented in the [AGO's] Report".
So let's take a closer look at how the two sides assess the value of health care services in Massachusetts.

This is a very interesting story and reminds me of the peer-review process for a scientific journal! I witness this quite a bit as I am a co-editor for a journal called "Value in Health". Only that that their review is usually single- (the authors don't know the reviewers' identity) or double-blinded (neither side knows who the other is, until the final decision is, of course, to publish the manuscript - the reviewers will know then if they bother to find out). 
However, a major difference here is that the original report and the "reviewer critique" are public! This makes the arguments for us all transparent, which I highly welcome.

What I like about the Dreyer report is that it is very quantitative and shows most of the results. Therefore, I cannot comment much on the AGO's report (also, I'm not a lawyer).
Generally, I think it's a great idea to built multivariate models rather than assessing the relationship between two parameters at a time. However, this is only half-way! Have all variables that would a priori make sense as hypothesis been assessed as independent variables? And what about interaction (i.e., is there an association between the variables considered "independent") terms? As an example, geography could have influenced the case mix, and the case mix surely influences the DSH status. This is all cost stuff.
As for the quality, Dreyer assesses "Serious Reportable Events" and 30-day mortality rates for myocardial infarction (heart attack), heart failure, and pneumonia. In contrast to the other sections of the report, he does not use scatter plots but just summarizes the number of hospitals above or below national average. He argues that these differences are statistically significant; however, the number of national hospitals is huge (and therefore the standard error small), so it would have been more interesting to assess the difference between tertiles, quartiles, or quintiles in Massachusetts alone.

What is missing in both reports is a real assessment of how quality can (or cannot) explain differences in hospital and physician charges, and how quality relates to the other variables that, according to Dreyer, might explain variation in charges.

The ball is in the AGO's court again.

Sunday, June 20, 2010

If Air Travel Worked Like Health Care

I've recently been to a seminar on applying lean techniques in health care. Two speakers reported on the implementation of lean systems at Beth Israel Deaconess Medical Center. Then we heard something from an ex-employee of Toyota about their culture.

The introductory video was on the question "If Air Travel Worked Like Health Care". See for yourselves:

If you can't see the video, click here.

I've also collected a review copy of "On the Mend: Revolutionizing Healthcare to Save Lives and Transform the Industry" by John Toussaint and Roger Gerard. Stay tuned for a post on that!

Tuesday, June 15, 2010

The Value of Being an E-Patient

Tonight I went to to two great talks.

The first one was on Comparative Effectiveness Research (or Review) and what it can tell us. Scott Gazelle gave us a great overview by telling us how CER was introduced in the 2003 Medicare Prescription Drug, Improvement, and Modernization Act (and not just in the American Recovery and Reinvestment Act), about the CER definition for the Federal Council for CER ("the conduct and synthesis of systematic research comparing different interventions and strategies to prevent, diagnose, treat and monitor health conditions..."; complete definition here), and about the latest developments. Then philosopher Norman Daniels dwelt on what kind of questions CER is able to answer and which ones it can't.

The second talk was by e-patient Dave and his doctor, Danny Sands. They spoke on "The New World of Doctor-Patient Partnerships: How networked patients & physicians are collaborating to improve healthcare". If you don't know their story, I think it is worthwhile to watch this seven-minute video:

Although I had already heard a lot from them via the internet, the talk was riddled with interesting issues. One of the most interesting things to me that they mentioned (maybe unintentionally?) was the value of of an equipped, enabled, empowered, engaged, equals, emancipated and expert patient (definition of an e-patient). While that might not but quantifiable, it is certainly a very interesting thought. In Dave's case, I am personally convinced that being an e-patient as well as staying active and positive helped saving his life.

Saturday, June 12, 2010

Drilling Down Medicare Variation and Dartmouth Atlas

Before taking off to Africa, former fellow student Aaron Holman sent me this editorial commenting on a new analysis of Medicare survey  data - to examine similarities and differences with the results of the mighty Dartmouth Atlas. The editorial is written by the boss of Aaron's (as well as my) former academic department, Health Policy and Management at the Harvard School of Public Health, Arnold Epstein. He does a fantastic job of putting the new analysis by Zuckerman et al. into the context of clinical practice (starting off by comparing clinical practice in two places where he trained), policy analysis, the old Dartmouth findings, and whether this study changes anything.

What does the new analysis say? In a nutshell, Zuckerman and colleagues found that some of the variation in Medicare spending across U.S. regions that the Dartmouth Atlas found can be explained by other factors: demographic factors, (self-assessed) baseline health, other health variables such as new diagnoses or death during the year of observation, income and insurance type as well as supply of health resources.
Although "only" 33% of the 52% differences between the highest and the lowest spending quintiles remain unexplained, I am amazed by how much demographic variables (especially race and ethnicity, see table 1) contribute to the difference in expenditures - they are the second highest coefficient in the model (see figure 1). Obviously, health status and new diagnoses are important, although the exact conditions that account for the differences remain unclear. The authors point out that death of beneficiaries during year of observation shows a huge relative difference between the spending quintiles although the absolute values (and differences) are relatively low.
Interestingly, also the annual family income and dual-eligibility status (for additional Medicaid insurance vs. supplemental private coverage) also plays a huge role as does the supply of health resources -- especially if you look at quintiles 4 and 5 (versus 1) in figure 1.
The only beef or question I have with this study is whether there was an interaction assessed between the independent variables? In other words, the presence of a significant interaction term might indicate that the effect of one or more explanatory variables on spending is different at different values of another explanatory variable. This should be based on a priori hypotheses, e.g. a recent cancer of heart failure diagnosis might explain the death of the beneficiary, low socio-economic status might be associated with lower baseline health status, and so forth.

The Dartmouth Atlas has recently come under critique (see recent New York Times story and blog post by Jeff Levin-Scherz). There are two main problems with their data: 1) there were few multivariate analyses available to assess if other factors might explain part of the variation; and 2) how quality correlates with with costs (in other words, the value provided to Medicare/payors and patients). The latter has been assessed, but I am not aware of any data that does so in a multivariate fashion, taking into account other possible factors. This will certainly be an issue in the near future as everybody is citing the Darthmous Atlas variation in Medicare. We should not forget that it was the decade-long research of the Dartmouth Atlas team who brought these variations in health care to our minds and into our discussion.

Monday, June 7, 2010

Efficiency Graphs (Well, Not Really)

The New York Times today printed a few graphs comparing health care spending (in percentage of the growth domestic product) versus "result metric". They show the numbers of various countries for CT scanners, angioplasties (both per million people), life expectancy at birth, deaths from cancer (per 100,000 people), annual consultations per capita, and hospital beds (per 1,000 people).

"Oh, great - efficiency graphs!" I thought.

The cost graph is very interesting. It supposedly shows that the U.S. is a real outlier in terms of the country's health care spending. However, the U.S. also has a higher GDP per capita compared to other large developed countries (such as France, Britain, and Turkey). Then, the total health care spending is even more of an outlier (see this graph).

However, I have two "real" takes on this: First, life expectancy at birth is the only outcomes measure. All the other measures are are not easy to interpret with additional information.

For example, the number of cancer deaths: The Times mentions that economists think this is an indication that the spending is out of line with what quality we get for that money. In other words: we get a low value. However, without the denominator (how many people have cancer?), this information is a mix of an epidemiological and an outcomes measure.
Or the number of angioplasties (Germany certainly has a lot of them) - are they all warranted? Are German and American cardiologists simply more aggressive to do this procedure? Does it lead to better or to worse outcomes? The Times does mention that the number of deaths from heart attacks is not much lower. However, there might be a higher number of heart attacks in the U.S. compared to other countries.

And then second, it would make a lot of sense to put these graphs together in an X-Y scatter plot to compare how cost and "results" relate to each other. For example, the real outcomes measure life expectancy at birth over GDP per capita. I looked for OECD data and came up with this:
Now, as for the value (cost over effectiveness or vice versa) and if the spending is "out of line": you could do a linear regression analysis. Here is what that would look like graphically:
As you can see, the U.S. has one of the largest residuals. However, maybe another function would fit the data better, what do you think?

By the way, if you are interested in health care cost then you probably know already the blog "Managing Health Care Costs". If not, I would like to highly recommend that you follow it. The blog is written by my former Professor Dr. Levin-Scherz who teaches a course on this topic. 

Wednesday, June 2, 2010

Comparison and Competition through Transparency

I strongly believe that a higher value for patients (the consumers of health care, so to speak) might in many cases only be achieved with more transparency. There are more and more institutions who become more an more transparent:
  • In a recent article, The Fiscal Times highlighted how hospitals in Wisconsin (among them the well-regarded ThedaCare health care system, famous for their ) publish their costs and compliances with best practice checklists through the Wisconsin Collaborative for Healthcare Quality.
  • In few areas, e.g. coronary artery bypass graft (CABG) surgery, there are in some States detailed and risk-adjusted rankings of the quality of  CABG programs available (often termed "report cards"). Early examples include New York State and Pennsylvania.  However, there might be adverse consequences from publishing such very detailed rankings, e.g. doctors avoiding high-risk patients and widening of disparities in health care utilization.
  • Medicare/Department of Health & Human Services offer a tool called "Hospital Compare". They publish patients' opinions about their treatment in six conditions and of 29 procedures in hospitals. 
  • The Commonwealth of Massachusetts has chosen a different approach: it publishes a composite index of quality and cost of care of procedures from different providers. On their website you can select in four different providers and compare their costs and quality compared to the state average (example). Importantly, as in Wisconsin, also costs (in terms of median, "low", and "high" charges) are being made transparent.
  • In his blog "Running a hospital", Paul Levy of Beth Israel Deaconess Medical Center in Boston has revealed more information than is available from their official hospital website, for example central line infection rates.
  • The Dartmouth Atlas is famous for the geographic comparison of different Medicare spending per enrollee. But they do have a few quality measures in their currently available analyses as well: patient satisfaction per HCAPHS survey, amputations and HbA1C as measures of ambulatory care, and the CMS Hospital Compare Score (another composite score, calculated with the Jha et al. method) for inpatient care:

Both typical health outcomes of different management strategies (or diagnostics, e.g. screening strategies) for a particular condition and the quality in which providers of health care offer them can only be put to real comparison if the health outcomes as well as the costs involved are clear. This is, at present, not necessarily given.

As Michael Porter and Elisabeth Teizberg write in their book "Redefining Health Care: Creating Value-Based Competition on Results", although a provider can also benchmark internally first, real competition between providers can only arise when both costs and quality of the health care services can be compared by the patient (disclaimer: I have participated in their week-long immersion program). I very much agree with the analysis of the current situation that Porter and Teisberg put forward, but not with all their "prescriptions" and the effects on the whole system that they predict.

How aware are patients of such a rankings? In a 1998 study by Eric Schneider and Arnold Epstein, only 12% of CABG patients in  Pennsylvania were aware of the report card before their procedure. This number could be MUCH higher today through the power of the internet.

These are just a few snippets of the discussion which is gaining speed. It will be very interesting to follow how this evolves over times. Will quality increase and costs decrease with more transparency and competition? Will all providers benefit from more referrals? Or will some be punished by lower revenues through, for example, lower rehospitalization rates? Will this all require different payment schemes, for example bundled payments for episodes of care, also known as capitation? Moreover, what effects will this have on the whole system, on referral practices and selection? Will less profitable or more complicated cases (which might be able to be treated as standardized and efficiently in integrated practice units) be treated differently? What do you think? You are welcome to comment!

Monday, May 31, 2010

Inaugural Blog Post

I have decided to start blogging about strategies to research, compare, and increase the value in health care. What is value in health care? Value takes into account both the health outcomes and the costs necessary to achieve or sustain them. Value is often defined as a ratio of costs over benefits/effects (or the reciprocal). Another related term to value is efficiency: can a particular strategy achieve the same outcomes at lower costs? What if the health outcomes are much higher but so are the costs - is the additional investment justified given the current discussion that the growth of health care costs need to slow? And what if the health outcomes are much worse but the costs are way below the comparator strategy?

What qualifies me to blog about this topic? I am deeply interested in clinical comparative effectiveness: what are the health outcomes of various treatments, for example when you compare them "head-to-head", be it in a clinical trial or in a meta-analysis. Also, I have done some work in cost-effectiveness analysis (the economic dimension of comparative effectiveness) and am looking at how is it being used in different health care systems. Cost-effectiveness offers theoretically the best way to compare the (long-term) consequences of two or more different strategies compares. Often, decision-analytic models are used to project costs and effects (for example life years or quality-adjusted life years) over time. However, since putting this approach into practice means rationing, in practice the implementation of using cost-effectiveness analysis to make coverage decisions is often prevented by politics.

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