Health and Medicine

FSI’s researchers assess health and medicine through the lenses of economics, nutrition and politics. They’re studying and influencing public health policies of local and national governments and the roles that corporations and nongovernmental organizations play in providing health care around the world. Scholars look at how governance affects citizens’ health, how children’s health care access affects the aging process and how to improve children’s health in Guatemala and rural China. They want to know what it will take for people to cook more safely and breathe more easily in developing countries.

FSI professors investigate how lifestyles affect health. What good does gardening do for older Americans? What are the benefits of eating organic food or growing genetically modified rice in China? They study cost-effectiveness by examining programs like those aimed at preventing the spread of tuberculosis in Russian prisons. Policies that impact obesity and undernutrition are examined; as are the public health implications of limiting salt in processed foods and the role of smoking among men who work in Chinese factories. FSI health research looks at sweeping domestic policies like the Affordable Care Act and the role of foreign aid in affecting the price of HIV drugs in Africa.

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As policymakers consider expanding insurance coverage for the human immunodeficiency virus (HIV+) population, it is useful to ask whether insurance has any effect on health outcomes, and, if so, whether public insurance is as efficacious as private insurance in preventing premature death. Using data from a nationally representative cohort of HIV-infected persons receiving regular medical care, we estimate the impact of different types of insurance on mortality in this population. Our main findings are that (1) ignoring observed and unobserved health status misleads one to conclude that insurance may not be protective for HIV patients, (2) after accounting for observed and unobserved heterogeneity, insurance does protect against premature death, and (3) private insurance is more effective than public insurance. The better performance of private insurance can be explained in part by more restrictive Medicaid prescription drug policies that limit access to highly efficacious treatment.

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Journal of Health Economics
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Using data from the National Health and Nutrition Examination Survey, we examine the relationship between nutritional status, poverty, and food insecurity for household members of various ages. Our most striking result is that, while poverty is predictive of poor nutrition among preschool children, food insecurity does not provide any additional predictive power for this age group. Among school age children, neither poverty nor food insecurity is associated with nutritional outcomes, while among adults and the elderly, both food insecurity and poverty are predictive. These results suggest that researchers should be cautious about assuming connections between food insecurity and nutritional outcomes, particularly among children.

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Journal of Health Economics
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Purpose

To compare the cost-effectiveness of surgical and angioplasty-based coronary artery revascularization techniques, in particular, angioplasty with primary stenting.

Methods

We used data from the Study of Economics and Quality of Life, a substudy of the Bypass Angioplasty Revascularization Investigation (BARI), to measure the outcomes and costs of angioplasty and bypass surgery in patients with multivessel coronary artery disease who had not undergone prior coronary artery revascularization. Using a Markov decision model, we updated the outcomes and costs to reflect technology changes since the time of enrollment in BARI, and projected the lifetime costs and quality-adjusted life-years (QALYs) for the two procedures from the time of initial treatment through death. We accounted for the effects of improved procedural safety and efficiency, and prolonged therapeutic effects of both surgery and stenting. This study was conducted from a societal perspective.

Results

Surgical revascularization was less costly and resulted in better outcomes than catheter-based intervention including stenting. It remained the preferred strategy after adjusting the stent outcomes to eliminate the costs and events associated with target lesion restenosis. Among angioplasty-based strategies, primary stent use cost an additional $189,000 per QALY gained compared with a strategy that reserved stent use for treatment of suboptimal balloon angioplasty results.

Conclusion

Bypass surgery results in better outcomes than angioplasty in patients with multivessel disease, and at a lower cost.

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American Journal of Medicine
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Douglas K. Owens
Mark A. Hlatky
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Over the last two decades, employers have increasingly offered workers a choice of health plans. The availability of choice has the potentially beneficial effects of lowering the cost and increasing the quality of health care through greater competition among health plans for enrollees as well as allowing consumers to enroll in the type of coverage that most closely matches their preferences. On the other hand, concerns about the potential for adverse selection within employment-based purchasing in response to the availability of choice exist. In this paper, I examine the effects of offering choice in employment-based purchasing groups on access to and the cost of employer-sponsored coverage. I find that greater availability of choice was associated with a reduction in the premium of employer-sponsored coverage and an increase in the proportion of workers covered by the plans offered by employers. However, most of the premium reductions were due to a shift from family to single coverage within employment-based purchasing groups and a reduction in the generosity of the plans in which employees were enrolled. The results are not consistent with the availability of choice leading to lower premiums through greater competition among plans for workers.

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National Bureau of Economic Research, working paper #9996
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PURPOSE: To evaluate the cost-effectiveness of recombinant human activated protein C (rhAPC) compared with usual therapy for patients with severe sepsis, and also to determine the influence that severity of illness exerts on cost-effectiveness. MATERIALS AND METHODS: We use a Markov model-based cost-effectiveness analysis of treatment strategies for patients with severe sepsis. Therapy includes treatment with either rhAPC and usual therapy, or usual therapy alone. Probabilities for clinical outcomes were obtained from a large randomized clinical trial comparing the use of rhAPC with placebo (PROWESS study) and from outcomes literature for patients with severe sepsis and its complications. Cost estimates were based on Medicare reimbursement rates, Health Care Financing Administration information and the literature. Outcome measures include life-years, quality-adjusted life-years (QALYs), costs, and incremental cost-effectiveness. RESULTS: Compared with usual therapy alone, rhAPC treatment for patients with very severe sepsis (APACHE II score > or = 25) was associated with an incremental cost-effectiveness ratio of $13 493/QALY. Treatment of patients with less severe sepsis with rhAPC (APACHE II score 25) had an incremental cost-effectiveness ratio of $403,000/QALY. For patients with very severe sepsis the incremental cost-effectiveness ratio for treatment with rhAPC remained under $30,000/QALY, over a broad range of variables, including costs of rhAPC, costs of acute care and costs and probabilities of complications of treatment. For patients with less severe sepsis, drug costs would need to fall well below current market price before achieving cost-effectiveness. A probabilistic sensitivity analysis comparing rhAPC treatment with usual therapy for patients with very severe sepsis showed that 1% of Monte Carlo simulations had incremental cost-effectiveness ratios > $50,000/QALY. CONCLUSIONS: The use of rhAPC for the treatment of patients with very severe sepsis, as determined by APACHE II score > or = 25, appears cost-effective, while treatment of patients with APACHE II score 25 is not cost-effective.

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Journal of Critical Care
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VA Palo Alto Health Care System
795 Willow Road (152-MPD)
Menlo Park, CA 94025

(650) 493-5000 ext 23369 (650) 617-2690
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Associate Professor of Medicine at the VA Palo Alto Health Care System
Frayne,_SusanM_BW3x4.jpg MD, MPH

Susan Frayne is an associate professor of medicine at the VA Palo Alto Health Care System, and a CHP/PCOR associate. A general internist, she previously founded and directed a comprehensive women's health center in Boston in which medical and mental health services were closely integrated. Drawing on this clinical background, she conducts health services research at the interface of medicine and mental health. She is examining both the mental health care that patients with mental illness receive in the primary care setting (identification and treatment of depression in primary care) and the medical care they receive (quality of diabetes care provided to patients with and without mental illness).

Stanford Health Policy Associate

Graduate School of Business
Stanford University
Stanford, CA 94305-5015

(650) 723-2160 (650) 725-7979
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Richard A. Stepp Professor of Economics
bulow.jpg MA, PhD
Stanford Health Policy Associate

Project Goal
To create and apply a methodology for the review of quality improvement implementation strategies -- approaches to closing the "quality gap" between ideal and actual care -- in national priority areas identified recently by the Institute of Medicine (IOM). These priority areas were selected by the IOM based on the notion that most quality problems in health care arise not from a lack of effective clinical practices, but rather from inadequate delivery strategies for implementing these practices.

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PURPOSE: To conduct an empirical analysis of self-referred whole-body computed tomography (CT) and develop a profile of the geographic and demographic distribution of centers, types of services and modalities, costs, and procedures for reporting results. MATERIALS AND METHODS: An analysis was conducted of Web sites for imaging centers accepting self-referred patients identified by two widely used Internet search engines with large indexes. These Web sites were analyzed for geographic location, type of screening center, services, costs, and procedures for managing imaging results. Demographic data were extrapolated for analysis on the basis of center location. Descriptive statistics, such as frequencies, means, SDs, ranges, and CIs, were generated to describe the characteristics of the samples. Data were compared with national norms by using a distribution-free method for calculating a 95% CI (P .05) for the median. RESULTS: Eighty-eight centers identified with the search methods were widely distributed across the United States, with a concentration on both coasts. Demographic analysis further situated them in areas of the country characterized by a population that consisted largely of European Americans (P .05) and individuals of higher education (P .05) and socioeconomic status (P .05). Forty-seven centers offered whole-body screening; heart and lung examinations were most frequently offered. Procedures for reporting results were highly variable. CONCLUSION: The geographic distribution of the centers suggests target populations of educated health-conscious consumers who can assume high out-of-pocket costs. Guidelines developed from within the profession and further research are needed to ensure that benefits of these services outweigh risks to individuals and the health care system.

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Radiology
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OBJECTIVE: Positron emission tomography (PET) is a high-cost imaging tool primarily used in oncology, cardiology, and neuropsychiatry. Accurate estimates of the cost of PET are needed to assess its cost effectiveness and determine the appropriate role for this modality in clinical applications. We performed a survey-based cost analysis of PET with FDG by estimating direct, indirect, and capital costs from eight PET centers. A breakdown of the operational budget of PET centers and FDG-compounding facilities is presented along with the costs per scan. Differences in costs between sites that purchase FDG and those that manufacture FDG are also examined. MATERIALS AND METHODS: We sent surveys to managers of eight Veterans Affairs and two non-Veterans Affairs PET scanning and FDG-compounding facilities. The survey included questions about service volume and the direct costs of equipment, personnel, space, supplies, and repairs needed for FDG compounding and PET scanning and interpretation. We estimated the indirect costs associated with FDG compounding, PET scanning, and PET interpretation. RESULTS: Of the eight sites that responded to our survey, three sites manufacture FDG on-site, three sites purchase FDG, and two sites do both. The total mean cost per scan using manufactured FDG is 1885 US dollars, and it is 1898 US dollars using purchased FDG. CONCLUSION: PET is expensive. The cost is similar when FDG is manufactured or purchased. Because both PET and cyclotron facilities have high fixed costs, increasing the number of scans obtained and the number of FDG doses manufactured may lead to a decrease in unit costs.

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American Journal of Roentgenology
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