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Calculation of costs of different medical and surgical services has numerous uses, which include monitoring the performance of service-delivery, setting the efficiency target, benchmarking of services across all sectors, considering investment decisions, commissioning to meet health needs, and negotiating revised levels of funding. The role of private-sector healthcare facilities has been increasing rapidly over the last decade. Despite the overall improvement in the public and private healthcare sectors in Bangladesh, lack of price benchmarking leads to patients facing unexplained price discrimination when receiving healthcare services. The aim of the study was to calculate the hospital-care cost of disease-specific cases, specifically pregnancy- and puerperium-related cases, and to indentify the practical challenges of conducting costing studies in the hospital setting in Bangladesh. A combination of micro-costing and step-down cost allocation was used for collecting information on the cost items and, ultimately, for calculating the unit cost for each diagnostic case. Data were collected from the hospital records of 162 patients having 11 different clinical diagnoses. Caesarean section due to maternal and foetal complications was the most expensive type of case whereas the length of stay due to complications was the major driver of cost. Some constraints in keeping hospital medical records and accounting practices were observed. Despite these constraints, the findings of the study indicate that it is feasible to carry out a large-scale study to further explore the costs of different hospital-care services.

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BACKGROUND: Clinical studies have demonstrated statistically significant reduction of breast cancer relapse and improved overall survival by adding trastuzumab for 1 year after adjuvant chemotherapy in human epidermal growth factor receptor-2 protein (HER2)/neu-positive breast cancer. The aim of this study was to analyze the cost-effectiveness of HER2/neu testing and the addition of 1-year adjuvant trastuzumab after adjuvant chemotherapy from a societal perspective in a Swedish setting. MATERIAL AND METHODS: We used a Markov state transition model to simulate HER2/neu testing and adjuvant trastuzumab treatment in a hypothetical cohort of early breast cancer patients. RESULTS: The cost per quality adjusted life year (QALY) gained for immunohistochemical (IHC) testing for all patients with FISH confirmation of IHC 2+ and 3+ and 1-year adjuvant trastuzumab for FISH-positive patients was estimated to 36,000 euros. The strategy of FISH testing for all patients, with 1-year adjuvant trastuzumab for FISH-positive patients was associated with the longest quality adjusted survival of all evaluated treatment strategies and the cost per QALY gained was estimated to 41,500 euros. The remaining testing and treatment strategies were dominated. CONCLUSION: FISH testing for all patients with 1-year adjuvant trastuzumab for FISH+ patients is a cost-effective treatment option from a societal perspective.

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INTRODUCTION: Intervention thresholds (ITs), the 10-year hip fracture risk at which treatment can be considered to be cost-effective, have previously been estimated for Sweden and the UK. OBJECTIVE: The aim of this study was to provide a Markov cohort model platform for a multinational estimation of thresholds at which intervention becomes cost-effective and to investigate and determine the main factors behind differences in these thresholds between countries. RESULTS AND DISCUSSION: Intervention thresholds were estimated for Australia, Germany, Japan, Sweden, Spain, the UK and USA using a societal perspective. The model was populated with as much relevant country-specific data as possible. Intervention was assumed to be given for 5 years and to decrease the risk of all osteoporotic fractures by 35%. The societal willingness to pay (WTP) for a quality-adjusted life-year (QALY) gained was set to the gross domestic product (GDP) per capita multiplied by two. In the base case analysis, the 10-year hip fracture probability at which intervention became cost-effective varied across ages and countries. For women starting therapy at an age of 70 years, the IT varied from a hip fracture probability of 5.6% in Japan to 14.7% in Spain. The main factors explaining differences in the IT between countries were the WTP for a QALY gained, fracture-related costs and intervention costs. CONCLUSION: The ITs presented in this paper are appropriate for use in treatment guidelines that consider health economic aspects, and they can be used in combination with fracture risk prediction algorithms to improve the selection of patients who are suitable for osteoporotic intervention.

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A cross-sectional study was carried out at county, township and village health care facilities in four counties in rural China in order to describe and compare the effects of health financing systems on antibiotic prescribing in outpatient care. A total of 1232 outpatients at the health care facilities was selected by multi-stage random sampling and were interviewed over 2 weeks. The results showed that health financing systems appeared to influence antibiotic prescribing in outpatient care, both in terms of frequency and of the types prescribed. The insured group had lower prescribing of antibiotics at township and village health care facilities, and for respiratory tract infections, but had higher prescribing of newer antibiotics at county and village health care facilities, for respiratory tract and g-i infections. Because there was a high patient compliance rate (94.3%) in this study the prescribing of antibiotics (supply side behavior) reflected the use of antibiotics (demand side behavior) to a great extent. Thus the results imply that antibiotics prescribing and using might be biased by the patient's health financing systems and antibiotic prescribing was the result of the interaction between physicians and patients.

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Recently, the responsibility for prescribed pharmaceuticals in Sweden was transferred from national level to the regional health authorities (county councils). The purpose was that a closer integration and balance between pharmaceuticals and other factors of production in health care should produce better opportunities for a cost-effective use of the total health care resources. The purpose of this paper is to present a deeper analysis of pharmaceuticals as a production factor in Sweden, mainly during the 1990s, and to discuss the future development and future policy decisions in Sweden. Pharmaceuticals have increased their share of total health care expenditure in Sweden, from about 9% in 1990 to about 14% in 1995. The Swedish pharmaceutical market can be divided into sub-markets, where the prescription sub-market accounts for the greater part of pharmaceutical expenditure. Further, a few disease categories account for a larger fraction of the cost of prescribed pharmaceuticals. The importance of pharmaceuticals as a production factor also differs between different age groups. Several factors are expected to contribute to a future increase in Swedish pharmaceutical expenditure, for instance an ageing population and the rapid introduction of expensive new pharmaceuticals.

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This paper describes the effects of health financing systems (insurance) on outpatient drug use in rural China. 1320 outpatients were interviewed (exit interview) in the randomly selected county, township and village health care facilities in five counties in three provinces of central China. The interview was face to face. Questions were asked by a trained interviewer and were answered by patient him/herself. The main finding was that health insurance appeared to influence drug use in outpatient services. The average number of drugs per visit was 2.56 and drug expenditures per visit was 16.9 yuan. Between insured and uninsured (out-of-pocket) groups, there were significant differences in the number of drugs and drug expenditures per visit. The insured had a lower number of drugs and a higher drug expenditure per visit than the uninsured, implying the use of more expensive drugs per visit than the uninsured. There were also significant differences in the number of drugs and drug expenditures per visit between the types of insurance. One third of the drugs were anti-infectives, most of which were penicillin, gentamycin, and sulfonamides. The results imply that uninsured patients do not receive the same care as the insured do even if they have the same needs. The fee-for-service financing for hospitals and health insurance have changed health providers' and consumers' behaviour and resulted in the increase of medical expenditure.

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This paper has two purposes. The first purpose is methodological and aims to extend previous work on efficiency analysis by implementing a multiple-output stochastic ray frontier production function model. This model generalizes the single-output stochastic frontier model to multiple-input, multiple-output technologies and allows simultaneous estimation of technical efficiency and analysis of influential variables on efficiency. The second, empirical, purpose is to test for existence and magnitude of the effect of purchaser/provider split combined with new reimbursement schemes on technical efficiency in the Swedish public hospital system. The analysis is carried out with a panel data set covering the total population of 26 Swedish County Councils from 1989 to 1995. Our empirical results support the frontier model specification and indicate that output-based reimbursement improves technical efficiency. The potential saving in costs due to a switch from budget-based allocation to output-based allocation is estimated to be almost 10%.

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In 1978, China decided to reform its economy and since then has gradually opened up to the world. The economy has grown rapidly at an average of 9.8% per year from 1978 to 1994. Medical expenditure, especially for drugs, has grown even more rapidly. The increase in medical expenditure can be attributed to changing disease patterns, a higher proportion of older people in the population and fee-for-service incentives for hospitals. Due to the changing economic system and higher cost of health care, the Chinese government has reformed its health care system, including its health and drug policy. The drug policy reform has led to more comprehensive policy elements, including registration, production, distribution, utilization and administration. As a part of drug policy reform, the drug distribution network has also been changed, from a centrally controlled supply system (push system) to a market-oriented demand system (pull system). Hospitals can now purchase drugs directly from drug companies, factories and retailers, leading to increased price competition. Patients have easier access to drugs as more drugs are available on the market. At the same time, this has also entailed negative effects. The old drug administrative system is not suitable for the new drug distribution network. It is easy for people to get drugs on the market and this can lead to overuse and misuse. Marketing factors have influenced drug distribution so strongly that there is a risk of fake or low quality drugs being distributed. The government has taken some measures to fight these negative effects. This paper describes the drug policy reform in China, particularly the distribution of drugs to health care facilities.

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OBJECTIVES: To describe effects of health financing on providers' opinions and prescribing behavior in rural China. METHODS: A multi-stage sampling procedure was used to select county, township, and village health care facilities. A total of 1,064 health care providers in county, township, and village health care facilities in six counties in central China were randomly selected and surveyed during one week by written questionnaire. RESULTS: Patient's health financing systems (insurance or out-of-pocket payment), financing methods for health facilities (general budget or fee for service), and payment methods for providers (salary or bonus) influenced provider prescribing. Bonuses could improve the quality of health care, but could also be an incentive to prescribe more drugs or more expensive drugs and other services. The providers were of the view that patients' health financing and ability to pay were the main determinants of the type of treatment. Insured patients could have more access to expensive drugs, referred to specialized health care facilities, and have a higher cure rate (according to the doctor's opinion) for tuberculosis. Most of the clinical doctors said that they prescribed more expensive antibiotics for insured patients and changed prescriptions according to patients' demands, financial ability, and health financing systems in the treatment of some diseases, such as chronic bronchitis, tuberculosis, and hypertension. CONCLUSION: The empirical data suggest that the main factor influencing provider prescribing behavior is the economic incentives in relation to health care financing for both health care providers and consumers.

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Clinical manifestations (locomotion score) and annual costs were studied in a population-based cohort of 82 patients with rheumatoid arthritis fulfilling five to eight American Rheumatological Association's (ARA) criteria. The total costs were SEK 4.9 million: respectively 56 and 44 percent direct and indirect costs. The costs were correlated with total, as well as subjective and objective, locomotion scores, which assess separately impairment, disability, and handicap from the disease (WHO 1980). Patients below 65 years had higher costs-predominantly as an indirect cost due to loss of work-than older patients. Elderly rheumatoid arthritis (RA) patients had a low score and high costs for medical and social services' care, but they had no indirect costs. Patients with a low locomotion score had received previous hospital treatment averaging 89 days. The need of hospital treatment was strongly correlated with low locomotion score. The mean annual patient's costs were about SEK 60,000, but above this for younger patients. When compared with patients with a mild affliction (score 91-100), patients with moderate manifestations, i.e., with a score of 70-90, had five times higher costs, whereas those with severe manifestations, with a score below 50, had 20 times higher costs.

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An attempt was made to evaluate risks, benefits and costs of total hip replacement in patients over 80 years. Forty consecutive replacements in 37 patients were analysed and the results were compared to a younger population (36 patients) concerning complications and duration of hospitalization. The elderly group was reexamined two years postoperatively to assess the outcome. There was a significantly prolonged stay in hospital/long-term care for the octogenarians, 31.1 days compared to 13.6 for the younger group, as well as an increased risk for complications. Eleven patients had 18 different complications (11/40; 27.5%) in contrast to 2 complications in 2 patients (2/36; 5.6%) in the younger population. Quality of life was increased in terms of pain relief and there was moderate improvement in function. For the elderly, the community expenses for welfare services were not found to be reduced after the intervention. It is concluded that the observed improvement of quality of life has to be balanced against the increased risks and costs for this group.

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