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In 1983 Congress changed the way Medicare pays for hospital care.
Under the new prospective payment system, hospitals are paid a
fixed rate, set in advance, to cover a patient's stay. If costs are
less than the fixed rates, the hospital keeps the profit; if the
costs are more, it absorbs the loss. From the beginning,
prospective payment was recognized as a revolutionary change in
Medicare. Congress wanted a system that would make federal
expenditures more predictable and controllable, and expected
hospitals to respond by becoming more efficient. Some observers
have hailed it as a successful way to control the spiraling costs
of the Medicare program. Others have criticized it as arbitrary and
a threat to the health of the elderly. In the six years since
prospective payment was introduced, a substantial amount of
evidence has accumulated about its effects. Russell looks at the
major characteristics of the rate payment system, how it has
changed the pattern of medical service, how these changes have
affected the health of the beneficiaries, and the system's effects
on Medicare outlays. She reviews what is known and what needs to be
learned to arrive at a valid assessment of the system. Moreover,
she contributes to the larger debate on Medicare by making what are
frequently quite technical evaluations accessible to the general
public.
A growing body of research indicates that prevention offers the
promise of better ways to maintain health and extend life. In this
timely volume, Louise B. Russell shows that preventive measures are
not as simple as often depicted while many do improve health, they
are not without risk or cost, and in fact rarely reduce medical
expenditures. Each measure, she argues, must be evaluated
individually and in all its dimensions: health benefits, health
risks, and resource costs.To demonstrate the many factors involved
in evaluating preventive measures, Russell examines the policy
debates about smallpox and measles vaccination, screening and drug
therapy for hypertension, and exercise. She uses these case studies
to explain the methods of cost-effectivness analysis, showing how
the choice among health investments can be made a more rational
exercise. The volume concludes with a suggested framework for the
design of future cost-effectiveness evaluations. Policymakers in
and out of the health field will benefit from this lucid
examination of the potential of prevention for improving health and
changing the allocation of limited resources.
"A copublication with the Milbank Memorial Fund"
Prevention is the best cure--or is it? As medical experts hammer
home the importance of annual medical checkups and routine
screening for everything from high blood pressure to cancer,
Americans have come to believe that frequent screening tests are
essential for saving lives. But just how effective are the tests
that we have come to take for granted? In this provocative book,
medical economist Louise Russell challenges the standard wisdom
that more is necessarily better by examining three routinely
administered tests--those designed to detect cervical cancer,
prostate cancer, and high levels of cholesterol.
Standard recommendations such as annual Pap smears for women and
prostate tests for men over forty are in fact simply rules of thumb
that ignore the complexities of individual cases and the tradeoffs
between escalating costs and early detection, Russell argues. By
looking beyond these recommendations to examine conflicting
evidence about the effectiveness of screening tests, Russell
demonstrates that medical experts' recommendations are often far
simpler and more solid-looking than the evidence behind them. It is
not at all clear, for example, that annual Pap smears are effective
enough in reducing deaths from cervical cancer to justify the
enormous additional costs involved in testing all women every year
rather than every three years. Nor is there solid evidence for the
value of prostate cancer screening, despite recommendations that
all men over forty be tested annually.
The three case studies presented here, each important in its own
right, raise serious questions about how tests are evaluated,
recommendations formed, andmedical resources allocated. At a time
when American health care policies and the escalating costs of
health care are the object of renewed scrutiny, Russell's challenge
to conventional wisdom is especially important. Based on a detailed
analysis of the available medical research, yet written in a
straightforward, jargon-free style, "Educated Guesses" will be
required reading for all those concerned about making informed
choices about health care policies and their personal health.
A COMPLETE UPDATE AND REVISION OF THE CLASSIC TEXT "At last, a
manual of operations for comparing the cost-effectiveness of a
preventive service with a treatment intervention." -American
Journal of Preventive Medicine Twenty years after the first edition
of COST-EFFECTIVENESS IN HEALTH AND MEDICINE established the
practical benchmark for cost-effectiveness analysis, this
completely revised edition of the classic text provides an
essential resource to a new generation of practitioners, students,
researchers, and policymakers. Produced by the Second Panel on
Cost-Effectiveness in Health and Medicine-a team of 13 experts from
fields including decision science, economics, ethics, psychology,
and medicine-this new edition is a comprehensive guide to the use
of cost-effectiveness analysis as an evaluative tool at the
institutional and policy levels. As health care systems face
increasing pressure to derive maximum value from expenditures, the
guidelines in this new text represent not just the best information
available, but a vital guide to health care decision-making in a
challenging new era. Completely revised and enriched with examples
and expanded coverage, this second edition of COST-EFFECTIVENESS IN
HEALTH AND MEDICINE builds on its predecessor's excellence,
offering required reading for both analysts and decision makers.
This is a unique, in-depth discussion of the uses and conduct of cost-effectiveness analyses (CEA) as decision-making aids in the health and medical fields. The product of over two years of deiberation by a multi-disciplinary Public Health Service appointed panel that included economists, ethicists, psychometricians, and clinicians, it explores cost-effectiveness in the context of societal decision-making for resource allocation purposes. It proposes that analysts include a "reference-case" analysis in all CEA's designed to inform resource allocation and puts forth the most expicit set of guidelines (together with their rationale) ever outlined of the conduct of CEAs. Important theoretical and practical issues encountered in measuring costs and effectiveness, valuing outcomes, discounting, and dealing with uncertainty are examined in separate chapters. These discussions are complemented by additional chapters on framing and reporting of CEAs that aim to clarify the purpose of the analysis and the effective communication of its findings. Primarily intended for analysts in medicine and public health who wish to improve practice and comparability of CEAs, this book will also be of interest to decision-makers in government, managed care, and industry who wish to consider the roles and limitations of CEA and become familiar with criteria for evaluating these studies.
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