Health Care as a "Market Good"? Appendicitis as a Case Study

University of California, San Francisco, and Ecologic Institute, Berlin, Germany (Dr Srebotnjak).
Archives of internal medicine (Impact Factor: 13.25). 04/2012; 172(10):818-9. DOI: 10.1001/archinternmed.2012.1173
Source: PubMed
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    ABSTRACT: To determine the variation in charges for 10 common blood tests across California hospitals in 2011, and to analyse the hospital and market-level factors that may explain any observed variation.
    BMJ Open 08/2014; 4(8):e005482. DOI:10.1136/bmjopen-2014-005482 · 2.06 Impact Factor
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    ABSTRACT: BackgroundThough past studies have shown wide variation in aggregate hospital price indices and specific procedures, few have documented or explained such variation for distinct and common episodes of care.ObjectivesWe sought to examine the variability in charges for percutaneous coronary intervention (PCI) with a drug-eluting stent and without major complications (MS-DRG-247), and determine whether hospital and market characteristics influenced these charges.MethodsWe conducted a cross-sectional analysis of adults admitted to California hospitals in 2011 for MS-DRG-247 using patient discharge data from the California Office of Statewide Health Planning and Development. We used a two-part linear regression model to first estimate hospital-specific charges adjusted for patient characteristics, and then examine whether the between-hospital variation in those estimated charges was explained by hospital and market characteristics.ResultsAdjusted charges for the average California patient admitted for uncomplicated PCI ranged from $22,047 to $165,386 (median: $88,350) depending on which hospital the patient visited. Hospitals in areas with the highest cost of living, those in rural areas, and those with more Medicare patients had higher charges, while government-owned hospitals charged less. Overall, our model explained 43% of the variation in adjusted charges. Estimated discounted prices paid by private insurers ranged from $3,421 to $80,903 (median: $28,571).ConclusionsCharges and estimated discounted prices vary widely between hospitals for the average California patient undergoing PCI without major complications, a common and relatively homogeneous episode of care. Though observable hospital characteristics account for some of this variation, the majority remains unexplained.
    PLoS ONE 08/2014; 9(8):e103829. DOI:10.1371/journal.pone.0103829 · 3.53 Impact Factor
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    ABSTRACT: To examine the between-hospital variation of charges and discounted prices for uncomplicated vaginal and caesarean section deliveries, and to determine the institutional and market-level characteristics that influence adjusted charges. Using data from the California Office of Statewide Health Planning and Development (OSHPD), we conducted a cross-sectional study of all privately insured patients admitted to California hospitals in 2011 for uncomplicated vaginal delivery (diagnosis-related group (DRG) 775) or uncomplicated caesarean section (DRG 766). Hospital charges and discounted prices adjusted for each patient's clinical and demographic characteristics. We analysed 76 766 vaginal deliveries and 32 660 caesarean sections in California in 2011. After adjusting for patient demographic and clinical characteristics, we found that the average California woman could be charged as little as US$3296 or as much as US$37 227 for a vaginal delivery, and US$8312-US$70 908 for a caesarean section depending on which hospital she was admitted to. The discounted prices were, on an average, 37% of the charges. We found that hospitals in markets with middling competition had significantly lower adjusted charges for vaginal deliveries, while hospitals with higher wage indices and casemixes, as well as for-profit hospitals, had higher adjusted charges. Hospitals in markets with higher uninsurance rates charged significantly less for caesarean sections, while for-profit hospitals and hospitals with higher wage indices charged more. However, the institutional and market-level factors included in our models explained only 35-36% of the between-hospital variation in charges. These results indicate that charges and discounted prices for two common, relatively homogeneous diagnosis groups-uncomplicated vaginal delivery and caesarean section-vary widely between hospitals and are not well explained by observable patient or hospital characteristics.
    BMJ Open 01/2014; 4(1):e004017. DOI:10.1136/bmjopen-2013-004017 · 2.06 Impact Factor


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