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In 2013 US health care spending increased 3.6 percent to $2.9 trillion, or $9,255 per person. The share of gross domestic product devoted to health care spending has remained at 17.4 percent since 2009. Health care spending decelerated 0.5 percentage point in 2013, compared to 2012, as a result of slower growth in private health insurance and Medicare spending. Slower growth in spending for hospital care, investments in medical structures and equipment, and spending for physician and clinical care also contributed to the low overall increase.

In this paper, we explore the role patient incentives play in slowing healthcare spending growth. Evidence suggests that while patients do indeed respond to financial incentives, cost-sharing does not uniformly improve value; rather, cost-sharing provisions must be deliberately structured and targeted to reduce care of low marginal value. Other mechanisms may be helpful in targeting particular populations or types of utilization. The spillover effects between privately insured and publicly insured populations as well as market imperfections suggest a potential role for public policy in promoting insurance design that slows spending growth while increasing the health that each dollar buys.

One goal of the Medicare Shared Savings Program for accountable care organizations (ACOs) is to reduce Medicare spending for ACOs' patients relative to the organizations' spending history. However, we found that current rules for setting ACO spending targets (or benchmarks) diminish ACOs' incentives to generate savings and may even encourage higher instead of lower Medicare spending. Spending in the three years before ACOs enter or renew a contract is weighted unequally in the benchmark calculation, with a high weight of 0.6 given to the year just before a new contract starts. Thus, ACOs have incentives to increase spending in that year to inflate their benchmark for future years and thereby make it easier to obtain shared savings from Medicare in the new contract period. We suggest strategies to improve incentives for ACOs, including changes to the weights used to determine benchmarks and new payment models that base an ACO's spending target not only on its own past performance but also on the performance of other ACOs or Medicare providers.

Under the Affordable Care Act, up to thirteen million adults have the opportunity to obtain health insurance through an expansion of the Medicaid program. A great deal of effort is currently being devoted to eligibility verification, outreach, and enrollment. We look beyond these important first-phase challenges to consider what people who are transitioning back to the community after incarceration need to receive effective care. It will be possible to deliver cost-effective, high-quality care to this population only if assistance is coordinated between the correctional facility and the community, and across diverse treatment and support organizations in the community. This article discusses several examples of successful coordination of care for formerly incarcerated people, such as Project Bridge and the Community Partnerships and Supportive Services for HIV-Infected People Leaving Jail (COMPASS) program in Rhode Island and the Transitions Clinic program that operates in ten US cities. To promote broader adoption of successful models, we offer four policy recommendations for overcoming barriers to integrating individuals into sustained, community-based care following their release from incarceration. [PUBLICATION ABSTRACT]

The effective management of patients with chronic illnesses is critical to bending the curve of health care spending in the United States and is a crucial test for health care reform. In this article we used data from three national surveys of physician practices between 2006 and 2013 to determine the extent to which practices of all sizes have increased their use of evidence-based care management processes associated with patient-centered medical homes for patients with asthma, congestive heart failure, depression, and diabetes. We found relatively large increases over time in the overall use of these processes for small and medium-size practices as well as for large practices. However, the large practices used fewer than half of the recommended processes, on average. We also identified the individual processes whose use increased the most and show that greater use of care management processes is positively associated with public reporting of patient experience and clinical quality and with pay-for-performance.

Policy Points In the absence of federal action on rising prescription drug costs, we reviewed the details of five states that have enacted prescription drug–pricing boards seeking to lower drug prices based on products’ value. Within these states, six such boards are currently authorized; they have similarities but vary in terms of structure, authority, scope, and leverage. As of June 2021, only one of the boards in our sample has conducted pricing reviews; legislators in other states can learn from the successes and challenges of existing boards. Prescription drug–pricing boards represent a novel and promising way to curb state spending and pay for value in prescription drugs but face legal and political barriers in implementation. Context Rising prescription drug costs are consuming a growing proportion of state and private budgets. In response, lawmakers have experimented with a variety of policies to contain spending and achieve value in prescription drugs. As part of this series of reforms, some state legislatures have recently authorized prescription drug–pricing boards to address the high prices of brand‐name prescription drugs and assess the value of those drugs. Methods We identified state prescription drug–pricing boards in the United States, defined as any agency authorized by a state legislature to review specific drugs and pursue value‐based drug prices. To describe the characteristics of the boards, we obtained public records of authorizing legislation, guidance documents, and board meeting minutes. We compared the boards’ powers and responsibilities and analyzed completed pricing reviews. Findings Six state drug‐pricing boards in five states met our definition; their design varied substantially. Two of the boards (New York Medicaid and Massachusetts) have authority over drug rebates paid by state Medicaid programs, one (New York Drug Accountability Board) has jurisdiction over state‐regulated commercial insurance, and another three (Maine, Maryland, and New Hampshire) oversee non‐Medicaid, state‐funded insurance. Three boards are authorized to require manufacturers to confidentially submit information related to the pricing and clinical effectiveness of reviewed drugs to inform value determinations. Only one board (New York Medicaid) had completed pricing reviews as of June 3, 2021. Conclusions Boards’ structure, scope, and statutory leverages to compel manufacturers to negotiate lower net costs are key factors that influence whether and to what extent boards can achieve cost savings for states. Though legal constraints may limit the effective reach of prescription drug–pricing boards, these agencies can enable states to address rising prescription drug costs, in part by virtue of their very existence. To overcome practical limitations, states seeking to implement similar policies can build on the experiences and designs of current boards.

Background: The rising costs of drugs are putting health care systems under pressure. We report on the Bavarian Drug Agreement, which employs prescribing targets for preferred and generic drugs in ambulatory care. Under this agreement, providers are regularly profiled with individual feedback but also possible sanctions. We investigated the degree to which targets were being met (or not) and why failure occurred. Methods: We analysed prescribing data aggregated by practice for the quarter 1/2018. We chose eight specialisation groups and analysed their drug targets with a high prescribing volume, widely missed drug targets (<90%), and drugs preventing drug target achievement. Characterisation of drug targets and preventing drugs was undertaken. Results: Drug targets with a high prescribing volume are mostly achieved, while highly missed drug targets mostly do not affect the main indication area of the specialisation groups considered. Generic drug targets seem to be more easily achieved than recommended drug targets. Paediatrics accounts for the largest number of missed drug targets. Conclusions: The Bavarian tool implemented uses the prescribing volume (DDD) and price components to evaluate the prescription behaviour of physicians. Well-established drugs with demonstrated effectiveness, safety, and lower costs are preferred. Nevertheless, me-too drugs, combination drugs, costly innovations with unclear value, and drugs with application methods of variable convenience challenge the drug prescribers and are reasons for missed drug targets.

The percentage of Americans with high medical cost burdens -- those who spend more than 10 percent of their family income on out-of-pocket expenses for health care -- increased to 19.2 percent in 2011, after having stabilized at 18.2 percent during the Great Recession of 2007-09. The increase was driven primarily by growth in premium expenses in 2009-11 for people with employer-sponsored coverage. Out-of-pocket spending on health services, especially for prescription drugs, continued to decrease between 2007-09 and 2011. Medical cost burdens were highest for income groups most likely to benefit from the Affordable Care Act's coverage expansions, including people with private insurance coverage. Those who purchased nongroup coverage before the implementation of the health insurance Marketplaces in 2014 spent an especially high proportion of their income on health care, and over half of these people will qualify for premium subsidies in the Marketplaces. Federal subsidies will substantially reduce medical cost burdens for many people who do not obtain health insurance through their employers.

The United States has been singularly unsuccessful at controlling health care spending. During the past four decades, American policymakers and analysts have embraced an ever changing array of panaceas to control costs, including managed care, consumer-directed health care, and most recently, delivery system reform and value-based purchasing. Past panaceas have gone through a cycle of excessive hope followed by disappointment at their failure to rein in medical care spending. We argue that accountable care organizations, medical homes, and similar ideas in vogue today could repeat this pattern. We explain why the United States persistently pursues health policy fads—despite their poor record—and how the promotion of panaceas obscures critical debate about controlling health care costs. Americans spend too much time on the quest for the “holy grail”—a reform that will decisively curtail spending while simultaneously improving quality of care—and too little time learning from the experiences of others. Reliable cost control does not, contrary to conventional wisdom, require fundamental delivery system reform or an end to fee-for-service payment. It does require the U.S. to emulate the lessons of other nations that have been more successful at limiting spending through budgeting, systemwide fee schedules, and concentrated purchasing.

It is a continual challenge trying to improve the quality of prescribing while concurrently trying to address increasing pharmaceutical development, utilization and expenditure. National and regional reforms and initiatives in Sweden have moderated growth in ambulatory drug expenditure to 2.7% per annum in recent years despite increasing volumes. National reforms include mandatory generic substitution and value-based pricing alongside devolution of drug budgets to the regions. Regional initiatives include strengthening the role of the regional Drug and Therapeutic Committees, further budget devolution as well as strategies incorporating prescribing guidance and monitoring coupled with financial incentives. The extent and nature of the regional initiatives vary depending on their characteristics. In this article, we compare initiatives undertaken in two major counties, Stockholm and Östergötland, and their outcomes. Outcomes include annual drug budget savings while achieving agreed quality as well as increased adherence to prescribing targets and guidance; the latter associated with savings. Appraising these multifaceted reforms can provide guidance to other countries and regions in view of their diversity. Future steps must incorporate measures to improve the utilization of new expensive drugs, which should include horizon scanning and forecasting activities as well as post-launch activities involving monitoring of prescribing and registries. This may well require cooperation with other European countries.