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Showing papers in "Health Economics in 1995"



Journal ArticleDOI
TL;DR: The objective of this paper is to assess the importance of state dependent reporting errors in survey responses and to propose and estimate a model that can be used to account for this kind of systematic mis-reporting.
Abstract: The use of subjective health measures in empirical models of labour supply and retirement decisions has frequently been criticized. Responses to questions concerning health may be biased due to financial incentives and the willingness to conform to social rules. The eligibility conditions for some social security allowances, notably Disability Insurance benefits, are contingent upon bad health. Even if the decision to apply for a disability allowance is to some extent motivated by financial considerations or a relatively strong preference for leisure, respondents will be inclined to play down these motives and emphasize the importance of their health condition. As a consequence, reporting errors may depend on the labour market status of the respondent and self-reported health variables will be endogenous in labour supply and retirement models. The objective of this paper is to assess the importance of state dependent reporting errors in survey responses and to propose and estimate a model that can be used to account for this kind of systematic mis-reporting. The estimation results indicate that among respondents receiving Disability Allowance, reporting errors are large and systematic. Using such subjective health measures in retirement models may therefore seriously bias the parameter estimates and the conclusions drawn from these.

285 citations


Journal ArticleDOI
TL;DR: Schooling is found to be related to good health even after controlling for differences in observable health inputs, and lack of support for a plausible specification of the productive efficiency hypothesis casts some doubt on the interpretation that schooling increases the efficiency of the household production of health.
Abstract: This paper uses an econometric specification based on the health production function approach to examine the importance of lifestyles for adult health. The approach treats health practices such as eating breakfast, smoking, and exercise as inputs into the production of good health; several output measures are explored. The econometric models estimated with data from the 1985 Health Interview Survey show broad agreement with conventional wisdom about the importance of healthy lifestyles. This paper also investigates the role schooling plays in the production of good health. Schooling is found to be related to good health even after controlling for differences in observable health inputs. However, lack of support for a plausible specification of the productive efficiency hypothesis casts some doubt on the interpretation that schooling increases the efficiency of the household production of health.

164 citations


Journal ArticleDOI
TL;DR: A pilot study designed to test the feasibility of using the Time Trade-Off (TTO) method to isolate the effect of pure time preference from the effects of duration per se found that it was close to zero.
Abstract: There is increasing interest in health status measurement and the relative weights that people attach to different states of health and illness. One important issue which has been raised is the effect that the time spent in a health state may have on the way that state is perceived. Previous studies have suggested that the worse a state is, the more intolerable it becomes as it lasts longer. However, for most of these studies, it is impossible to determine how much of what was observed is attributable to the time spent in the state and how much is attributable to when it was occurring. This paper reports on a pilot study designed to test the feasibility of using the Time Trade-Off (TTO) method to isolate the effect of pure time preference from the effect of duration per se. Interviews were conducted with 39 members of the general population who were asked to rate 5 health states for durations of one month, one year and ten years. In aggregate, rates of time preference were very close to zero which suggests that the implicit assumption of the TTO method that there is no discounting may be a valid one. However, that more respondents had negative (rather than positive) rates, casts some doubt on the axions of discounted utility theory. In addition, implied valuations for states lasting for short periods were often counter-intuitive which questions the feasibility of using the TTO method to measure preferences for temporary health states.

151 citations


Journal ArticleDOI
TL;DR: A first technique for obtaining confidence intervals for cost-effectiveness ratios is provided, which does not use sophisticated tools to achieve maximal optimality, but seeks for tractability and ease of application while still satisfying all formal statistical requirements.
Abstract: The reduction of costs is becoming increasingly important in the medical field. The relevant topic of many clinical trials is not effectiveness per se, but rather cost-effectiveness ratios. Surprisingly, no statistical tools for analyzing cost-effectiveness ratios have been provided in the medical literature yet. This paper explains the gap in the literature, and provides a first technique for obtaining confidence intervals for cost-effectiveness ratios. The technique does not use sophisticated tools to achieve maximal optimality, but seeks for tractability and ease of application while still satisfying all formal statistical requirements.

145 citations


Journal ArticleDOI
TL;DR: Journal editors and readers of economic evaluation articles should acquaint themselves with the methods for handling uncertainty in order that they can critically evaluate the extent to which authors have allowed for uncertainties inherent in their analysis.
Abstract: A structured methodological review of journal articles published in 1992 was undertaken to determine whether recently published economic evaluation studies deal systematically and comprehensively with uncertainty. Ninety three journal articles were identified from a range of searches including a computerised search of the MEDLINE CD-Rom database. Articles were reviewed to determine how they had handled uncertainty in: a) data sources; b) generalisability; c) extrapolation; and d) analytic method. Articles were subsequently assessed to determine how they had represented this uncertainty in terms of the overall results of their analysis. Finally, studies were rated on the basis of their overall performance with respect to dealing systematically and comprehensively with uncertainty. Despite the numerous books and articles devoted to the appropriate methods to be employed by analysts conducting economic evaluation, 22 (24%) studies failed to consider uncertainty at all and 35 (38%) studies employed sensitivity analysis in a manner judged as inadequate. In all, 36 (39%) studies were judged to have given at least an adequate account of uncertainty with 13 (14%) of those judged to have provided a good account of uncertainty. Such disappointing results may reflect a general lack of detail in much of the methods literature concerning how sensitivity analysis should be applied and how results should be presented. Journal editors and readers of economic evaluation articles should acquaint themselves with the methods for handling uncertainty in order that they can critically evaluate the extent to which authors have allowed for uncertainties inherent in their analysis.

124 citations


Journal ArticleDOI
TL;DR: Use of prompts, rather than simply asking women to state their WTP, had a statistically significant effect on post-test result values, demonstrating the importance to women of other benefits of screening.
Abstract: We report on a study of women's willingness to pay (WTP) for a cystic fibrosis carrier test by one or other method of service delivery (disclosure or non-disclosure). The results demonstrate that there was no statistically significant difference in WTP for the methods of testing. Those women who received a negative test result were followed up and asked their WTP for such a result. Values obtained at this stage were 16 per cent higher than those obtained pretest result. Use of prompts, rather than simply asking women to state their WTP, had a statistically significant effect on post-test result values. The opportunity to terminate the pregnancy, if a test proved positive, was important, but was not the only consideration. This demonstrates the importance to women of other benefits of screening.

114 citations


Journal ArticleDOI
TL;DR: The empirical model estimates the differential effect of the removal of copayments for prescription medicines on the prescription drug utilization by older adults with differing levels of health status and the two-part estimator of this model is found to dominate the competitors.
Abstract: The two-part estimation technique has been advocated for estimating models using individual level health care utilization data characterised by a large proportion of non-consumption and small proportions of heavy users. This paper compares the two-part model to several other estimators, including the Poisson, negative binomial and 'zero altered' negative binomial models on the basis of within-sample forecasting accuracy and non-nested model selection tests. The empirical model estimates the differential effect of the removal of copayments for prescription medicines on the prescription drug utilization by older adults with differing levels of health status. The two-part estimator of this model is found to dominate the competitors. Results from this model indicate that utilization increases appear to be higher among individuals with lower levels of health status.

109 citations


Journal ArticleDOI
TL;DR: A Grossman-style health production model set up in discrete time is developed and applies to explain the impact of environmental pollution on the demand for both health and health care and the quality of the environment turns out to be an important determinant of health capital.
Abstract: The paper develops and applies a Grossman-style health production model set up in discrete time to explain the impact of environmental pollution on the demand for both health and health care. In order to introduce the environment, our analysis takes changes in environmental conditions to influence the rate at which an individual's stock of health depreciates. While the theoretical part of our paper also contains a discussion of the full model, we restrict our empirical analysis to a submodel which is known as the pure investment model. This is because the other submodel, the pure consumption model, implies a rather implausible case of satiation with respect to the individual's preferences. Our empirical findings are based on data taken from the German Socio-economic Panel. The stock of health capital and environmental pollution are treated as latent variables and estimated using a Linear Covariance Structures model. The quality of the environment turns out to be an important determinant of health capital. From the point of view of health economics, improvements in environmental conditions can be interpreted as preventive measures. In terms of prevention, public policies designed to protect the environment also yield significant health effects. As regards health care demand the influence is not clearcut, i.e., one cannot necessarily expect a reduction in resource use.

92 citations


Journal ArticleDOI
TL;DR: The inherent weaknesses of the Israeli health care system that have led to the crisis in the mid 1980s are outlined, the recommendations of the State Commission for structural change in the system are summarized, and the politics of implementing the recommended reforms are reviewed.
Abstract: On June 15, 1994, the Israeli Parliament voted to enact the National Health Insurance bill (NHI) The bill marks the end of a process that lasted for virtually as long as Israel's almost 50 year history Israel's attempts at health reform began long before the current spate of reforms in many Western countries Faced with many of the same problems of access, equity and cost control common to many of its counterparts, Israel initiated a reform process based on the recommendations of a prominent State Commission of Inquiry into the Israeli Health System (the Netanyahu Commission) which reported to the Government in 1990 The Commission's proposals were based on a diagnosis indicating that the major problems of the system stem from the lack of clarity regarding the rights of citizens to health care, the lack of a clear allocation of responsibility and accountability among government, insurance or sick funds, and providers in the system, and undue centralization of system operations This diagnosis led to three major planks for reform: (1) enactment of national health insurance legislation granting a basic package of care to each citizen and hence bringing most of the system's finance under public auspices; (2) divesting the Government from the organization, management and provision of care; hence integrating the management of preventive and psychiatric services provided by the government with the primary and other services provided by sick funds, and granting financial and operational independence to at least government hospitals; and (3) restructuring the Ministry of Health As is often the case in public policy, more consensus surrounds the diagnosis than the solutions As a result, nearly four years of implementation efforts have only recently resulted in a major breakthrough In this paper we make an effort to outline the inherent weaknesses of the Israeli health care system that have led to the crisis in the mid 1980s, summarize the recommendations of the State Commission for structural change in the system, and review the politics of implementing the recommended reforms

77 citations


Journal ArticleDOI
TL;DR: An economic model of the market for treatment of waiting list conditions, in which complainants choose between private treatment, NHS treatment and no hospital treatment, is developed and the responsiveness of the equilibrium to various demand side and supply side shocks is explored.
Abstract: This paper develops an economic model of the market for treatment of waiting list conditions, in which complainants choose between private treatment, NHS treatment and no hospital treatment. This choice depends on a number of clinical and non-clinical factors, which enter the demand functions for private and NHS treatment. Among the key influences are the price of private treatment and the expected duration of wait for NHS treatment, both of which are endogenous variables in the model. Given a pair of private sector and NHS supply functions, expressions are obtained for the price and expected wait at which demand and supply are simultaneously equated in both the private sector and the NHS. The paper concludes by exploring the responsiveness of the equilibrium to various demand side and supply side shocks.


Journal ArticleDOI
TL;DR: This study contributes to the understanding of the demand for cigarettes by taking into account the interdependence of smoking and other behavioural risk factors by constructing a monthly cigarette price index for California based on data obtained from the Bureau of Labor Statistics.
Abstract: This study contributes to the understanding of the demand for cigarettes by taking into account the interdependence of smoking and other behavioural risk factors. Information on smoking and other behavioural risk factors including drinking, alcohol use, and obesity were obtained from the California Behavioural Risk Factor Survey for the period 1985-91. A monthly cigarette price index for California was constructed based on data obtained from the Bureau of Labor Statistics. A two-part model was used to examine separately the effect of price on the decision to be a smoker, and on the amount of cigarettes smoked by smokers. The overall price elasticity of cigarettes was estimated at -0.46, with a price elasticity of -0.33 for smoking participation and of -0.22 for the amount of cigarettes consumed by smokers. The inclusion of other behavioural risk factors reduced the estimated price elasticity for smoking participation substantially, but had no effect on the conditional price elasticity for the quantity of cigarettes smoked.


Journal ArticleDOI
TL;DR: General Household Survey data sets, covering the period 1978-1990, are pooled to investigate the relationship between the riskiness of individuals' self-reported drinking behaviour and a wide range of personal characteristics and economic factors, and grouped data regression approach is used to reduce problems with the inaccuracy of self-reports of alcohol consumption.
Abstract: General Household Survey (GHS) data sets, covering the period 1978-1990, are pooled to investigate the relationship between the riskiness of individuals' self-reported drinking behaviour and a wide range of personal characteristics and economic factors. A grouped data regression approach is used to reduce problems with the inaccuracy of self-reports of alcohol consumption and clustering of observations in the consumption data. Results for males aged 18 to 24 years are presented, and possible methods for interpreting the results of grouped data regression are illustrated. Controlling for other factors, current smokers are estimated to be at a 75% higher risk of drinking over recommended levels than non-smokers. Particular attention is paid to the interactions between the price of alcohol, income and heavy drinking. At average levels of income, a 5% increase in the real price of alcohol is predicted to reduce the probability of 'at-risk' drinking by 1.5%. At lower initial levels of income, drinking patterns are found to be more responsive to both price and income changes. Grouped data regression is proposed as a way of focusing policy analysis on individual risks of alcohol-related health and social problems.

Journal ArticleDOI
TL;DR: The potential uses of CSOMs in economics are examined, namely: to provide valid descriptive material, to provide scales for comparing the effectiveness of interventions and to 'validate' the descriptive accuracy of economic measures of benefit.
Abstract: Despite growing concern over the use of health utility measures in economic evaluations of health care programmes, economists have been reluctant to use the wealth of knowledge contained within studies using condition specific outcome measures (CSOMs). Problems with the measurement properties of many CSOMs means that the scope for their use in economic appraisal is extremely limited. This paper examines the potential uses of CSOMs in economics, namely: to provide valid descriptive material, to provide scales for comparing the effectiveness of interventions and to 'validate' the descriptive accuracy of economic measures of benefit. It is argued that valid descriptive information is essential for economic appraisal, no matter which method of evaluation is used. Generic measures have been criticised for being too narrow and insensitive to the consequences of specific conditions. CSOMs offer a rich source of information to produce quality adjusted life years (QALYs) but two potential methods, one of mapping health states from one scale to a QALY classification (such as Rosser), and the other, developing 'exchange rates' between scales are unsatisfactory. A more rigorous approach would necessitate a major research programme of revaluing existing CSOMs using preference based methods. Another interesting avenue of research would be to use the information from CSOMs to construct health scenarios for valuation. Given the current state of development of outcome measures, it seems advisable to use CSOMs alongside economic measures in trials. Such a strategy would help demonstrate the usefulness of economic measures to clinicians and to reconcile the two measures.

Journal ArticleDOI
TL;DR: An accurate estimation of the price elasticity of utilisation is necessary if the full consequences of user charges are to be examined, and a cointegration estimation technique is used to estimate the prices of prescription drug utilisation in the UK.
Abstract: Since the inception of the NHS, user charges have been present for prescription medication. However since 1968 there has been a steady increase in this charge, particularly notable during the 1980s. The main justification for user charges is their revenue raising potential, and a recent government report has backed the use of user charges for prescription drugs. Whilst there is extensive evidence of the impact of user charges on utilisation of health care in the US, few studies exist in the UK. An accurate estimation of the price elasticity of utilisation is necessary if the full consequences of user charges are to be examined. This paper uses a cointegration estimation technique to estimate the price elasticity for prescription drug utilisation in the UK.

Journal ArticleDOI
TL;DR: A model based on the theory of demand for health and of supplier inducement is developed to explain the utilisation of dental care and general and personal inducement appear to have a considerable effect on utilisation, but did not have any systematic connection with dentist/population ratio.
Abstract: In this paper a model based on the theory of demand for health and of supplier inducement is developed to explain the utilisation of dental care. Of special interest are the effects of money price and various forms of inducement. It is also explored how the results are affected if different model specifications and estimation techniques are applied and what is the most appropriate one, when utilisation is measured by dental expenditure. The data come from a sample of 1779 employees, whose dental expenditure is refunded from 0 to 99.75%. Other things being equal, the methodological choices make a clear difference in parameter estimates. Only a log-linear two-part model and two-part tobit with selectivity were suitable for explaining expenditure and produced quite similar results. Money price elasticity was small, but significant (-0.069). General and personal inducement appear to have a considerable effect on utilisation, but did not have any systematic connection with dentist/population ratio.

Journal ArticleDOI
TL;DR: It is concluded that use of a reduced list is likely to generate substantial research economies only at the expense of inaccuracy, and total costs are predictable from a restricted list of cost and event variables, and with a high degree of accuracy, although ex ante specification of the functional form is problematic.
Abstract: As detailed costing may be a time-consuming and expensive exercise within an evaluation, economists will be conscious of the possibilities of taking short-cuts. To explore the viability of such approaches in the context of acute care (the surgical treatment for colorectal cancer), we compare the results of a detailed costing study with reduced list costing and econometric estimation. We conclude, first, that use of a reduced list is likely to generate substantial research economies only at the expense of inaccuracy. Second, crude costing, based upon average costs of the specialty, is acceptable when the frame of reference is the aggregate. Such crude costing, however, is vulnerable to bias when specific sub-samples of patients are to be considered. Finally, total costs are predictable from a restricted list of cost and event variables, and with a high degree of accuracy, although ex ante specification of the functional form is problematic.

Journal ArticleDOI
TL;DR: Increased emphasis will be increased emphasis on understanding the many roles of uncertainty in economic behaviour, institutions, and outcomes in health care, and in the use of more and more 'micro' data to study these issues.
Abstract: This paper, originally presented at the Institut d'Etudes Politiques de Paris, October 12, 1993, provides a perspective on envisioned changes in the practice of health economics. Foreseen changes include: (1) Study of more homogeneous units of analysis; (2) More original data gathering; (3) Increased attention to uncertainty and the supply of and demand for information; (4) Increased attention to institutional structures and their effects on economic behaviour; (5) Expansion of relevant tools for studying economic issues in health care; and (6) Continuing breakdown of disciplinary barriers between health economics and other disciplines. Of these, the two overriding features will be increased emphasis on understanding the many roles of uncertainty in economic behaviour, institutions, and outcomes in health care, and in the use of more and more ‘micro’ data to study these issues.

Journal ArticleDOI
TL;DR: The fact that the direction and degree of the utilization effect associated with changing fees is procedure-specific has direct implications for the ability to develop effective policies to modify physician behaviour that are based primarily on financial incentives, particularly those based on manipulating fees.
Abstract: Study Question: The study objective is to estimate the relationship between changes in the relative fee physicians receive for a procedure and the utilization of the procedure. Data Sources/Study Setting: The study uses claims-based, procedure-specific, quarterly, aggregate utilization data for physicians in three specialties and four provinces in Canada for the period 1977–1989. Study Design: The unit of analysis is an individual procedure. Multi-variate regression methods for cross-sectional/times-series data are applied to estimate the utilization-fee relationship while controlling for supply- and demand-side determinants of utilization. Principal Findings: There is no evidence of a strong, uniform utilization response among the 11 procedures analyzed. The results include a mixture of significant and non-significant fee coefficients, and among the significant coefficients, a mixture of signs is observed. The results are consistent with utility-maximizing behaviour by physicians rather than with profit-maximizing behaviour. Conclusions: The fact that the direction and degree of the utilization effect associated with changing fees is procedure-specific has direct implications for our ability to develop effective policies to modify physician behaviour that are based primarily on financial incentives, particularly those based on manipulating fees. The study also highlights the limitations of analyses based on aggregate data and suggests methodological approaches that have potential to overcome some of these limitations to fill gaps in our current knowledge.

Journal ArticleDOI
TL;DR: A postal survey of 150 editors of medical journals aimed at assessing editorial policy on peer- review of economic studies found few had trained economists as referees and none had criteria or guidelines for peer-reviewing economic studies.
Abstract: We report the results of a postal survey of 150 editors of medical journals aimed at assessing editorial policy on peer-review of economic studies. 70 editors (47%) responded to the anonymous questionnaire which contained six questions. 16 (23% or respondents) claimed to have an editorial policy, most claiming acceptance of ‘good evaluations’. Few (36%) had trained economists as referees and none had criteria or guidelines for peer-reviewing economic studies. This situation helps to explain the variable quality of international economic literature. There is an urgent need to produce internationally accepted sets of guidelines for authors, editors and peer-reviewers.

Journal ArticleDOI
TL;DR: It is concluded that at present the application of translog cost function analysis in the NHS is of limited usefulness, but that it does indicate areas for further methodological research.
Abstract: The reforms to the United Kingdom's National Health Service (NHS) of recent years have greatly increased the role of economic incentives in the hospital sector. Hospitals now have to compete for the business of GP and health authority purchasers and are assumed to have an incentive to minimise costs. This makes the analysis of cost functions much more relevant than has previously been the case. The objective of this paper is to assess the potential usefulness of the translog cost function applied in the NHS internal market. Three main issues are identified that limit the role of this type of cost function in the internal market: the adequacy of the econometric model (including data quality); the assumptions underlying the model, and; the interpretation of economies of scale, marginal costs and economies of scope that can be derived from such a cost function. It is concluded that at present the application of translog cost function analysis in the NHS is of limited usefulness, but that it does indicate areas for further methodological research.

Journal ArticleDOI
TL;DR: The analysis shows a strong grade effect at the lowest level which is 'diluted' at each succeeding level of aggregation; there is also a strong ward effect at each of the lower levels of aggregation.
Abstract: The large industry which has grown up around the estimation of nursing requirements for a ward or for a hospital takes little account of variations in nursing skill; meanwhile nursing researchers tend to concentrate on the appropriate organisation of the nursing process to deliver best quality care. This paper, drawing on a Department of Health funded study, analyses the relation between skill mix of a group of nurses and the quality of care provided. Detailed data was collected on 15 wards at 7 sites on both the quality and outcome of care delivered by nurses of different grades, which allowed for analysis at several levels from a specific nurse-patient interaction to the shift sessions. The analysis shows a strong grade effect at the lowest level which is 'diluted' at each succeeding level of aggregation; there is also a strong ward effect at each of the lower levels of aggregation. The conclusion is simple; you pay for quality care.

Journal ArticleDOI
Claudio Politi, Guy Carrin, David K. Evans1, F.A.S. Kuzoe1, P.D. Cattand 
TL;DR: The objective of the present cost-effectiveness analysis is to identify the costs and benefits that would be involved in switching from melarsoprol to eflornithine in the treatment of late stage sleeping sickness in Uganda.
Abstract: African trypanosomiasis, or sleeping sickness, is a tropical disease caused by trypanosome parasites transmitted by tsetse flies. The focus of this paper is on the cost-effectiveness of alternative drug treatments for patients in the late stage of the disease. Melarsoprol has been used for many decades. More recently, eflornithine has been developed. It has fewer side effects and improves the overall cure rate. It is much more expensive than melarsoprol, however. The objective of the present cost-effectiveness is to identify the costs and benefits that would be involved in switching from melarsoprol to eflornithine in the treatment of late stage sleeping sickness. Benefits are expressed in lives saved as well as in disability adjusted life years (DALYs). The analysis is applied to the case of Uganda. The implications for affordability are also considered, by taking account of how the treatment costs would be shared between the national government, donors and patients. The baseline results indicate that melarsoprol treatment is associated with an incremental cost per life and DALY saved of $209 and $8, respectively. Each additional life saved by switching from melarsoprol alone to a combination of melarsoprol and eflornithine would cost an extra $1,033 per life saved, and an extra $40.9 per DALY gained. Shifting from this second alternative to treatment of all patients with eflornithine leads to an incremental cost per life saved of $4,444 and an incremental cost of $166.8 per DALY gained.

Journal ArticleDOI
TL;DR: The present study applies the augmented Dickey Fuller Test to infant mortality time series for Sweden, United Kingdom and United States to support the hypothesis that infant survival and GNP/Capita are cointegrated for 19th century Sweden but not for19th century UK.
Abstract: Previous time series analyses of infant mortality have failed to provide evidence to support their implicit assumption that infant mortality data used behaved as a stationary time series. The present study applies the augmented Dickey Fuller Test to infant mortality time series for Sweden (1800-1989), United Kingdom (1839-1989) and United States (1915-1989). The null hypothesis that each of these series is non-stationary is accepted at standard levels of significance. A conceptual framework of infant mortality which uses a combination of physical and social overhead capital as factors in a production function is developed to explain the finding of non-stationarity as derivative from the non-stationarity of a stock of health-enhancing capital. Estimation of econometric models of the socioeconomic determinants of infant mortality using differenced data with ARIMA estimation is inconclusive. Estimation of a bivariate cointegration model supports the hypothesis that infant survival and GNP/Capita are cointegrated for 19th century Sweden but not for 19th century UK. Bivariate analysis of 20th century Sweden, UK, and US data demonstrated no cointegration. This may be due to the onset of disequilibrium in the economic determination of infant mortality in the present era as technological advances and demographic shifts began to play a larger role. Supplementing the bivariate analysis with measures of unemployment, and crude birth rate in the 20th century permitted the detection of cointegration in US and UK. The multivariate results may suggest that improvements in 20th century UK GNP/capita have had greater impact on infant survival relative to US GNP/capita.

Journal ArticleDOI
TL;DR: It appears that some specializations (circulatory system) involve more overproduction than others and that university hospitals tend to use more resources than regular hospitals.
Abstract: The purpose of the paper is to measure and to compare performance of Belgian hospitals during the year 1991. In order to measure hospitals' efficiency, we estimate a resource function which is defined as the relationship between medical fees incurred in the treatment of a patient and the patient's pathology. From this relation, we construct a best practice reference frontier which defines the minimal hospital medical fees needed to treat the pathology. Efficiency is assessed relative to this resource frontier using a parametric stochastic method proposed by Schmidt and Sickles.9 It appears that some specializations (circulatory system) involve more overproduction than others. Among the other results, we note that public hospitals are more efficient than the private ones and that university hospitals tend to use more resources than regular hospitals. The relationships between efficiency and different variables (location, size, costs and management) are finally analysed.

Journal ArticleDOI
TL;DR: US Department of Veterans Affairs data is used to examine issues of health care production estimation and the use of regression estimates like the teaching adjustment factor, and shows that measurement error and persistent multicollinearity confound attempts to have a large degree of confidence in the precise magnitude of parameter estimates.
Abstract: Medicare's Prospective Payment System pays U.S. teaching hospitals for the indirect costs of medical education based on a regression coefficient in a cost function. In regression studies using health care data, it is common for explanatory variables to be measured imperfectly, yet the potential for measurement error is often ignored. In this paper, U.S. Department of Veterans Affairs data is used to examine issues of health care production estimation and the use of regression estimates like the teaching adjustment factor. The findings show that measurement error and persistent multicollinearity confound attempts to have a large degree of confidence in the precise magnitude of parameter estimates.

Journal ArticleDOI
TL;DR: In this paper, the authors estimate the impact of different economic, structural and demographic factors on the per capita costs of health services and care of the elderly in Finland, and find that the factors associated with the need of services (age structure, morbidity) are the most important determinants of health care expenditure.
Abstract: In Finland, municipal health care expenditure varies from FIM 3 800 per capita to FIM 7 800 per capita. The objective of this study was to estimate the impact of different economic, structural and demographic factors on the per capita costs of health services and care of the elderly. Using regression analysis we attempted to explain observed differences in expenditure by determining separately the effects of allocative and productive inefficiency and the effects of factors influencing the demand for services. We found income level of local population, generosity of central government matching grant, allocative efficiency (the mix of care between institutional and non-institutional care), productive efficiency of service providers, and factors associated with the need of services (age structure, morbidity) to be the most important determinants of health care expenditure. Our results reveal that municipalities have the means at their disposal (by shifting resources to outpatient care and increasing productivity) to significantly reduce expenditure on health services and care of the elderly.

Journal ArticleDOI
TL;DR: This paper describes and justifies methods for costing the care provided for babies in an on-going multi-centre trial, the Collaborative ECMO trial, and concludes that the available cost estimates would need to be weighted to reflect the additional costs of drugs and investigations for this group of babies during the acute phase.
Abstract: Researchers working on economic evaluations alongside trials have to balance minimising data collection with maximising the ability to measure differences in costs. Using existing data sources may keep the costs of research down, but these data may not be entirely appropriate to the evaluation question. When evaluating technologies in intensive care it is particularly important to be able to classify patients correctly by their resource requirements especially when those requirements vary considerably from day to day. This paper describes and justifies methods for costing the care provided for babies in (one arm of) an on-going multi- centre trial, the Collaborative ECMO trial.1 This trial is evaluating alternative policies of life support for mature (full term) newborn babies with severe respiratory failure. The most reliable cost information on neonatal intensive care is available from a study, conducted independently from the trial, which has used simple cost apportionment on a large sample of units. By drawing on clinical opinion and carrying out a case note exercise we assessed whether this available information was appropriate to estimate ‘baseline’ costs for the control group during their initial ‘acute’ phase of illness. We concluded that the available cost estimates would need to be weighted to reflect the additional costs of drugs and investigations for this group of babies during the acute phase. Multidisciplinary collaboration on trials can help economists and other researchers to balance the requirement for simple cost measurements with more detailed primary research.