Health Economics (Pharmacy Business Administration Series)

381 Pages·2009·2.09 MB·English

by  Jordan Braverman

Health Economics
Introduction to the Pharmacy
Business Administration series
BooksinthePharmacyBusinessAdministrationserieshavebeenpreparedfor
useinuniversity-levelgraduateandprofessional-levelcourses,aswellasfor
continuingeducationandself-studyuses.Theseriesincludesbookscovering
the major subject areas taught in Social and Administrative Pharmacy,
PharmacyAdministration,andPharmacyMBAprograms.
World-classauthorswithwell-regardedexpertiseinthevariousrespective
areas have been selected and the book outlines, as well as the books them-
selves,havebeenreviewedbyanumberofotherexpertsinthefield.Theresult
ofthiseffortisanewintegratedandcoordinatedseriesofbooksthatisupto
date in methodology, research findings, terminology, and contemporary
trendsandpractices.
Thisisonebookinthatseriesofabout12subjectsintotal.Itisintended
thateachofthebookswillberevisedatleastevery5years.Whilethebooks
were intended for the North American market, they are just as relevant in
otherareas.
Titlesintheseriescurrentlyinclude:
HealthEconomics
HealthPolicyandEthics
PharmaceuticalMarketResearch
PrinciplesofGoodClinicalPractice
ResearchMethodsforPharmaceuticalPracticeandPolicy
PharmaceuticalMarketing:APracticalGuide
PharmaceuticalMarketingResearch:PrinciplesandPractice
FinancialAnalysisinPharmacyPractice
The series editor-in-chief is Professor Albert Wertheimer PhD MBA of
TempleUniversitySchoolofPharmacy,Philadelphia.
Suggestionsandcommentsfromreadersaremostwelcomeandshouldbe
senttoCommissioningEditor,PharmaceuticalPress,1LambethHighStreet,
LondonSE17JN,UK.
Health Economics
FIRST EDITION
Jordan Braverman
MPHMSFS
PublishedbythePharmaceuticalPress
AnimprintofRPSPublishing
1LambethHighStreet,LondonSE17JN,UK
100SouthAtkinsonRoad,Suite200,Grayslake,IL60030-7820,USA
(cid:1)PharmaceuticalPress2010
isatrademarkofRPSPublishing
RPSPublishingisthepublishingorganisationoftheRoyalPharmaceuticalSocietyof
GreatBritain
Firstpublished2010
TypesetbyThomsonDigital,Noida,India
PrintedinGreatBritainbyTJInternational,Padstow,Cornwall,UK
ISBN9780853698678
Allrightsreserved.Nopartofthispublicationmaybereproduced,storedinaretrieval
system,ortransmittedinanyformorbyanymeans,withoutthepriorwritten
permissionofthecopyrightholder.
Thepublishermakesnorepresentation,expressorimplied,withregardtothe
accuracyoftheinformationcontainedinthisbookandcannotacceptanylegal
responsibilityorliabilityforanyerrorsoromissionsthatmaybemade.
TherightofJordanBravermantobeidentifiedastheauthorofthis
workhasbeenassertedbyhiminaccordancewiththeCopyright,Designsand
PatentsAct,1988.
AcataloguerecordforthisbookisavailablefromtheBritishLibrary.
Dedication
Tomyparents,MorrisandMollyBraverman,whobothlivedwellintotheir
mid-90sandtaughtmybrother,Irwin,andmyselfgoodhealthpracticessoas
tomaintainourhealthinasbestastateaspossible.

Contents
Preface xiii
Acknowledgments xv
Abouttheauthor xvii
Introduction xix
1 HistoryofhealthcarefinancingintheUSA 1
Introduction 1
The19thcentury 2
TheProgressiveEra 3
The1920s 4
The1930s 5
The1940s 8
The1950s 9
The1960s 11
The1970s 12
The1980s 17
The1990s 19
The21stcentury 21
Theyear2012 23
2 ThecostsofAmericanhealthcare 27
Introduction 27
Someeconomicdefinitions 28
WhatUShealthcarespendinghasnotsolved 30
Backgroundofrisingcosts 38
Societalimpact ofhealthcarecosts 40
Whyhealthcarecostsoutpacegeneraleconomy 45
Addressingrisingcosts 46
viii | Contents
3 Thehighcostsofhealthcare:thereasonswhy 49
Introduction 49
Evolutionofhealthcareservices 50
Originsandelementsinhealthcarecrisis 52
Healthcarecosts 53
Nation'shealthbill 54
Hospitalcosts 55
Physicianservices 57
Theelderly 58
Healthinsurance 60
MedicaidandMedicare 63
Manpower 66
Resolvingthehealthcarecrisis 70
Thefuture 73
4 Physiciancare 77
Introduction 77
Manpower 78
Physicianreimbursement 83
Medicalmalpractice 89
Practicepatterns 92
Conclusion 94
5 Prescriptiondrugs 99
Introduction 99
Backgroundofprescriptiondrug costs 101
Brandnameversusgenericdrugs:differencesandcosts 103
FDA'sassuranceofqualitydrugs 105
Pharmacists 106
Waystopayforprescriptiondrugs 108
Conclusion 116
6 Hospitalcare 119
Introduction 119
Characterofhospitals 121
Hospitalcosts 121
Hospitalutilization:abriefprofile 127
Diagnosis-relatedgroups 128
Unbundlingthediagnosticcodes 131
Hospitalmedications 133
Reportcards 137
Conclusion 138
Contents | ix
7 Medicaltechnology 143
Introduction 143
Historyofmedicaltechnologyassessment 143
Thecostdrivers 147
Financialimpactofnewmedicaltechnology 149
Factorsinfluencinggrowthofnewtechnology 151
Medicaltechnologyexpenditures 152
Unhealthydilemmas 153
TheBritishview 153
Thefuture 154
8 Nursinghomecare 159
Introduction 159
Servicesavailableinnursinghomes 162
Classificationofnursinghomes 162
Definitionofaskillednursinghome 164
Componentsofnursinghomecare 168
Medicare'sNursingHomeCompare 173
Financingnursinghomecare 174
TheUSAandtheUK 179
9 Homecare andhospicecare 183
Introduction 183
Basicservices 184
Financialadvantagesofhomecare 186
Availabilityofhomecare 186
Definitionofbonded,licensed,andcertifiedhealthpersonnel 186
Howtofindhomecareagencyservices 187
Medicare'sHomeHealthCompare 190
Homecarepersonnel 191
Costofhomecareservices 192
Howtofinancehomehealthcareservices 192
Hospicecare 198
Financinghospicecareservices 200
Findinghospicecare 202
Conclusion 202
10 Healthcareplanning 205
Introduction 205
Definitionofhealthplanning 207
Thehistoricaldevelopmentofplanning 209
HealthPlanningActof1974 212