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Welfare Reform on the Web (February 2008): Healthcare - overseas

Adverse pharmaceutical payment incentives and providers' behaviour: the emergence of GP-owned gateway pharmacies in Taiwan

Y.-C. Lee, K.-H. Huang and Y.-T. Huang

Health Policy and Planning, vol. 2, 2007, p. 427-435

In Taiwan, the 2002 reform of the pharmaceutical payment system had the unintended consequence of increasing the market share of physician-owned pharmacies (gateway pharmacies) and reducing the earnings of clinics that did not own one. These gateway pharmacies are located in, and owned by, the clinics that prescribe medicines, thus creating an incentives for doctors to prescribe unnecessary drugs to increase their incomes. The authors call for the link between physician prescribing and profits from pharmaceutical sales to be broken.

Care of the chronically ill at home: an unresolved dilemma in health policy for the United States

K. Buhler-Wilkerson

Milbank Quarterly, vol. 85, 2007, p. 611-639

The problems of providing ongoing care to patients who have disabling illnesses and who neither get well nor die is not new. Chronically ill patients have always needed assistance at home from family, benevolent volunteers or paid caregivers. However, despite almost two centuries of experimentation in the US with organised efforts to provide daily and routine care at home for the chronically ill, no agreement has been reached concerning the proper balance between governmental resources and the private resources of family, friends and insurance. This article examines these issues and the unavoidable tensions between fiscal reality and legitimate need. It also uses historical and policy analyses to explain why home care has never become the cornerstone of caring for the chronically ill.

Changes in the effectiveness of state Medicaid Drug Program cost-containment policies following OBRA 1990

W.J. Moore and E.E. Pracht

American Journal of Economics and Sociology, vol. 66, 2007, p. 901-924

Congress included provisions in the Omnibus Budget Reconciliation Act (OBRA) 1990 aimed at changing how Medicaid programmes purchase prescription drugs and at lowering the growth rate of drug expenditures. The Act was predicted to save $3.4bn in total Medicaid expenditures over the first five years. This study analyses Medicaid drug spending data from 1985 to 1997 to determine how OBRA 1990 influenced the effectiveness of existing drug cost containment policies and if the Act produced the anticipated cost savings. The descriptive evidence indicates that reductions in drug expenditure growth rates following the passage of OBRA 1990 resulted from factors that are independent of the Act. Furthermore the analytical evidence shows that changes in the effectiveness of major cost containment policies such as drug formularies, drug utilisation review programmes and reimbursement rates, offset, at least in part, savings from the drug rebate programme included in OBRA 1990.

Drug shop regulation and malaria treatment in Tanzania: why do shops break the rules, and does it matter?

C. Goodman and others

Health Policy and Planning, vol. 22, 2007, p. 393-403

Infringement of regulations among small retail drug sellers in Tanzania was extremely common. Most stores lacked valid permits, and illegal sale of prescription-only medicines and unpackaged tablets was the norm. Most stocked unregistered drugs, and no serving staff met the qualification requirements. Infringements are likely to have reflected infrequent inspections, a failure on the part of regulatory authorities to impose sanctions, successful concealment of violations, and tacit permission of local regulatory staff. Eliminating regulatory infringements is unlikely to be feasible, and could be undesirable if access to essential medicines is reduced. Alternative approaches include bringing official regulation more in line with locally legitimate practices, greater use of positive incentives for providers, and consumer involvement.

The emergence of clinical practice guidelines

G. Weisz and others

Milbank Quarterly, vol. 85, 2007, p. 691-727

Practice guidelines telling doctors how to do their jobs better are now common throughout the Western world. The spread of clinical guidelines is usually explained as being either due to attempts by politicians to cut costs or to attempts by doctors to preserve their professional autonomy. In this article the authors suggest a new way to conceptualise the rise of guidelines: as a change in the method of regulating the quality of medical practice. They argue that the proliferation of collectively produced guidelines since the 1980s represents a growing effort to bring coherence and order to a rapidly expanding and heterogeneous medical domain.

Home truths from the other side of the world

C. Ham

Health Service Journal, Jan. 10th 2008, p. 16-17

In the 1990s the Conservative government in New Zealand introduced a quasi-market into the public health service which remained in place until Labour's election in 1999. The Labour government then abolished the purchaser/provider split on which the quasi-market was based and introduced 21 integrated district health boards. These both provide health services directly and purchase them from non-governmental providers. Two thirds of health board members are elected by the public and one third appointed by the Health Minister. Having abandoned competition, New Zealand seeks to improve health service performance through devolution and transparency on the one hand and targets and performance management on the other.

The logic of governance in health care delivery

M. Forbes, C.J. Hill and L.E. Lynn

Public Management Review, vol. 9, 2007, p. 453-477

A multi-level analytic framework termed a 'logic of governance' is used to identify systematic patterns of healthcare governance from the findings of disparate research studies. Using a subset of 112 studies on healthcare service delivery, the authors use an 'inside out' interpretive strategy to construct an empirical overview of healthcare governance. They conclude that healthcare outputs (services delivered and utilised) and outcomes (indicators of health status) are the results of complex interactions among hierarchical levels of healthcare governance: public policies that define and allocate resources to programmes and organisations and establish terms for their operation; the use of discretion by public managers to organise the work of their agencies and implement particular strategies; and the values, attitudes, treatment methods and resource utilisation skills of service workers.

Medicare and Medicaid: conflicting incentives for long-term care

D.C. Grabowski

Milbank Quarterly, vol. 85, 2007, p. 579-610

The federally run Medicare programme in the USA provides insurance benefits for virtually all retired people and younger disabled people. Medicaid, a state-run programme jointly funded by the state and federal governments, covers medical expenses of low-income enrollees. Many persons who are eligible for both Medicare and Medicaid require extensive acute and long-term care services. However, because Medicare covers relatively few long-term care services, Medicaid must cover the bulk of these costs for dually eligible beneficiaries. In this situation, each programme has a narrow interest in limiting its share of the costs, regardless of the impact on the other. Neither programme has an incentive to take responsibility for the management of quality of care. This article analyses the tensions between Medicare and Medicaid in the coverage of acute and long-term care services.

Protecting resources for primary health care under fiscal federalism: options for resource allocation

O.A. Okorafor and S. Thomas

Health Policy and Planning, vol. 22, 2007, p. 415-426

There is concern that the devolution of responsibility for healthcare expenditure to sub-national levels of government can adversely affect the equitable distribution of financial resources across local jurisdictions. Since the adoption of decentralisation of health budgets in South Africa, progress towards achieving a more equitable distribution of resources has slowed considerably. This study attempts to identify appropriate resource allocation mechanisms under the current South African fiscal federal system that could be employed to promote equity in spending on primary health care across provinces and districts. The particularly high level of autonomy enjoyed by provincial governments with regard to decisions about health spending emerged as the major barrier to achieving a more equitable distribution of resources. The national government needs to have more involvement in decision-making if equity in resource allocation for primary health care is to be achieved.

Redefining accountability in health care: managing the plurality of medical interests

R. Sorensen and R. Iedema

Health, vol. 12, 2008, p. 87-106

The demand for medical care is increasing, costs are escalating and consumers, administrators and policymakers are calling for greater transparency of process and accountability for outcomes in health services worldwide. This transformation is occurring within clinical environments characterised by uncertainty about treatment outcomes, their cost and their impact on a patient's quality of life. Medical decisions that commit high cost resources when survival is doubtful are being questioned. This research conducted in a large intensive care unit (ICU) in Sydney, Australia sought to assess the process of medical decision-making within high-cost, high-pressure, high-technology environments. The study found that dysfunctional relationships and power struggles between ICU clinicians and external medical consultants led to decision processes that were frequently arbitrary, contested and fraught.

A review of health resource tracking in developing countries

T. Powell-Jackson and A. Mills

Health Policy and Planning, vol. 22, 2007, p. 353-362

Timely, reliable and complete information on financial resources in the health sector is critical for sound policymaking and planning, particularly in developing countries where resources are scarce. Health resource tracking has seen encouraging advances in recent years in the standardisation of methods and availability of health expenditure data. This article reviews methods used to track health resources and recent experiences of their application, with a view to identifying the major challenges that must be overcome if data reliability and availability are to improve.

The role of community-based organizations in household ability to pay for health care in Kilifi District, Kenya

C. Molyneux and others

Health Policy and Planning, vol. 22, 2007, p. 381-392

Existing social resources provide a basis for protecting low-income households from the impoverishing effects of illness-related costs. Community-based organisations (CBOs) are one form of social resource that has considerable potential. Working with CBOs to strengthen healthcare affordability for households has challenges which include: identifying and building CBOs with a strong internal trust base; and co-ordination and collaboration among CBOs, and between CBOs and other non-governmental and governmental organisations. Protecting the poorest households through CBOs has particular challenges. These households are less likely to belong to any CBO, and the CBOs they have formed themselves involve others of a similarly low socio-economic status and are therefore relatively fragile. This article highlights the particular challenges around interventions of international interest at present: community-based health insurance schemes; micro-finance initiatives; and the removal of primary care user fees.

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