Negotiation

Organized by Stanford Health Policy Director Alan Garber, the Payment Reform Project brings together a group of economists and researchers interested in creating and studying novel approaches to payment for health care. The Project is the combined effort of Stanford Health Policy, FRESH-Thinking and the Stanford Institute for Economic Policy Research. This is a venue for people who have thought deeply about similar issues in other contexts to contribute to a health care discussion.

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We developed a mathematical model to simulate the impact of various partially effective preventive HIV vaccination scenarios in a population at high risk for heterosexually transmitted HIV. We considered an adult population defined by gender (male/female), disease stage (HIV-negative, HIV-positive, AIDS, and death), and vaccination status (unvaccinated/vaccinated) in Soweto, South Africa. Input data included initial HIV prevalence of 20% (women) and 12% (men), vaccination coverage of 75%, and exclusive male negotiation of condom use.

We explored how changes in vaccine efficacy and postvaccination condom use would affect HIV prevalence and total HIV infections prevented over a 10-year period. In the base-case scenario, a 40% effective HIV vaccine would avert 61,000 infections and reduce future HIV prevalence from 20% to 13%. A 25% increase (or decrease) in condom use among vaccinated individuals would instead avert 75,000 (or only 46,000) infections and reduce the HIV prevalence to 12% (or only 15%). Furthermore, certain combinations of increased risk behavior and vaccines with <43% efficacy could worsen the epidemic. Even modestly effective HIV vaccines can confer enormous benefits in terms of HIV infections averted and decreased HIV prevalence. However, programs to reduce risk behavior may be important components of successful vaccination campaigns.

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Publication Type
Working Papers
Publication Date
Journal Publisher
Journal of Acquired Immune Deficiency Syndrome
Authors
Douglas K. Owens
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To understand "managed care," one needs to understand the traditional model of health care organization and finance that managed care was intended to replace. That model was aptly characterized "Guild Free Choice" by Charles Weller to indicate that "free choice" was being used as a restraint of trade to block the emergence of any form of economic competition among doctors. Its principles were: "Free choice of doctor at all times;" "free choice of treatment, i.e. nobody 'interferes with the doctor's decisions and recommendations;'" "fee for service payment;" "direct doctor-patient negotiation of fees;" and "solo (or small single-specialty group) practice." The model was widely accepted because of the pre-Wennberg view of most people that "the medical care they receive [is] a necessity provided by doctors who adhere to scientific norms based on previously tested and proven treatments." In combination with well-insured patients, there was no way that employers or insurers could control health spending in this model. Organized medicine is still fighting to hold on to parts of it. Some people say that managed care is "anything other than Guild Free Choice."

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Publication Type
Working Papers
Publication Date
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Presented at the Federal Reserve Bank of Boston's 50th economic conference
Authors
Alain C. Enthoven
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