Leida M. Lamers

Inconsistencies in TTO and VAS values for EQ-5D health states.

Background. Most EQ-5D health states can be ordered logically. When people assign values to different health states, they may violate this logical order, which can be seen as inconsistencies. Objective. The aim of this study was to assess the effect of inconsistently valued EQ-5D health states on mean visual analog scale (VAS) and time trade-off (TTO) values. The authors also examined the effect of removing respondents with high numbers of inconsistent states on the estimation of tariffs, which is used to interpolate values to all possible EQ-5D states from the direct valuation of a subset of states. Method. Data from the Dutch EQ-5D valuation study were used. A representative sample of 309 Dutch adults valued 17 EQ-5D health states by VAS and TTO. A state was valued inconsistently when it had a higher value than at least 1 logically better state. Mean values of groups with various numbers of inconsistently valued states were compared. Results. Of the respondents, 65% had inconsistencies for VAS and 89% for TTO. The mean VAS values of consistent respondents tend to be lower. For TTO, those with inconsistencies gave lower values. Removing data of respondents with the highest number of inconsistently valued states for VAS (13%) and TTO (9%) did not result in statistically significant different coefficients in the estimated tariff using all data. Conclusion. The majority of respondents valued at least 1 state inconsistently. For both VAS and TTO, the presence of these inconsistencies did not affect the estimated tariffs

Risk sharing as a supplement to imperfect capitation: a tradeoff between selection and efficiency

This paper describes forms of risk sharing between insurers and the regulator in a competitive individual health insurance market with imperfectly risk-adjusted capitation payments. Risk sharing implies a reduction of an insurers incentives for selection as well as for efficiency. In a theoretical analysis, we show how the optimal extent of risk sharing may depend on the weights the regulator assigns to these effects. Some countries employ outlier or proportional risk sharing as a supplement to demographic capitation payments. Our empirical results strongly suggest that other forms of risk sharing yield better tradeoffs between selection and efficiency.

The Relationship between Productivity and Health-Related QOL: An Exploration

In economic evaluation of healthcare programmes both QOL and productivity of patients are aspects to be studied. Normally, the former is part of the measurement of the effectiveness of the programme and the latter is part of the measurement of its costs. In this paper we highlight the relationship between QOL and productivity. Two aspects are discussed: (i) the relationship between perceived productivity and health-state valuations; and (ii) the observed relationship between productivity and QOL.The first aspect relates to the fact that in health-state valuations, respondents may consider income changes and ability to work. While this may have important methodological and practical implications, little empirical evidence exists in this area. The second aspect relates to the fact that the observed productivity of individuals is expected to be related to their health-related QOL. Worse health states are expected to be associated with lower productivity. Again, empirical investigation is lacking; however, this relationship may prove important, for instance in modelling productivity costs with use of information on QOL. This paper explores these relationships between productivity and QOL to stimulate debate and research in this area.

Risk-adjusted capitation payments: Developing a diagnostic cost groups classification for the Dutch situation

In many countries market-oriented health care reforms are high on the political agenda. A common element of these reforms is that the consumers may choose among competing health insurers or health plans, which are largely financed through premium-replacing capitation payments. Since 1993, Dutch sickness funds receive risk-adjusted capitation payments based on demographic factors. It has been shown that the predictive accuracy of a demographic capitation model improves when it is extended with diagnostic information from prior hospitalizations, in the form of Diagnostic Costs Groups (DCGs). In this study a DCG classification is developed using Dutch cost data of sickness fund members of all ages. The study also dealt with the question of how to handle high discretion diagnoses. For the Dutch situation high discretion diagnoses may be defined as those diagnoses for which day case treatment is a possible alternative for a hospital admission. Grouping persons with a hospital admission for high discretion diagnoses together with people without an admission resulted in a slight reduction of the predictive accuracy of the DCG model. Adequate risk-adjustment is critical to the success of market-oriented health care reforms. The use of diagnostic information from prior hospitalizations seems a promising option for improving the capitation formula.

The relationship between productivity and health-related quality of life : An empirical exploration in persons with low back pain

Objective: In economic evaluation of health care programmes normally health-related quality of life is part of measurement of a programme’s effectiveness and productivity part of its costs. In this paper the relationship between quality of life and productivity is highlighted and empirically assessed in persons suffering from low back pain. Methods: A secondary analysis was performed on data from a sample of 483 patients treated for low back pain. Periodically, both quality of life (EQ-5D) and productivity indicators for both paid and unpaid work were measured. Mean EQ-5D scores were compared for groups of patients classified by level of productivity. The relationship between quality of life and productivity was also assessed using Spearman rank correlation coefficients. Results: Mean EQ-5D scores for patients without productivity losses were a half to a full standard deviation higher than for patients with the lowest levels of productivity. The correlation between quality of life and productivity was moderate. Conclusion: Lower levels of quality of life were associated with efficiency loss and absenteeism. However, due to the moderate strength of the relation the use of information on quality of life to model productivity costs in case of absence of productivity data was not recommended.

On the Assessment of Preferences for Health and Duration Maximal Endurable Time and Better Than Dead Preferences

Background: Several studies revealed difficulties with the valuation and analysis of health states deemed worse than dead. These problems may be linked to maximal endurable time (MET) preferences, the phenomenon that for severe states better than dead (BTD), shorter durations are often preferred to longer durations. Objective: To test the association between the duration of health states and their valuation. Methods: A representative sample of 123 Dutch respondents (age range, 18–45 years) valued 5 EQ-5D health states. With a straightforward method using BTD preferences, respondents indicated whether a state of a certain duration is better, equal to, or worse than dead. To validate these BTD preferences, MET preferences (whether a longer duration of a health state is better, equal, or worse than a shorter duration) were collected. Results: BTD and MET preferences were strongly related (P < 0.001). For severe health states, although still judged as better than dead, BTD preferences curved downwards with increasing duration. Such curved BTD patterns occurred in 28% of the respondents, especially for more severe states (P < 0.001). Conclusions: BTD preferences revealed that the value of moderate and severe states declines with increasing duration, suggesting that health and duration interact. For states worse than dead versus states better than dead, traditional valuation techniques have the drawback that different preference questions are used. Using BTD preferences, however, a single simple preference question can assess states better than dead, as well as states worse than dead.

Health-based risk adjustment: Improving the pharmacy-based cost group model to reduce gaming possibilities

The pharmacy-based cost group (PCG) model uses medication prescribed to individuals in a base-year as marker for chronic conditions which are employed to adjust capitation payments to their health plans in the subsequent year. Although the PCG model enhances predictive performance, possibilities for gaming may arise as it is based on prior utilization. This study investigates several strategies to mitigate this problem. The best strategies appear to be: use a (high) number of prescribed daily doses to assign persons to PCGs, do not allow for comorbidity, and remove PCGs with low future costs. This PCG model accounts for almost twice as much variance as do demographic models. In 2002 the Dutch government implemented this model in the sickness fund sector (twothirds of the population).

Risk adjusted premium subsidies and risk sharing: key elements of the competitive sickness fund market in the Netherlands

As part of a market-oriented health care reform, in 1991 risk adjusted premium subsidies were introduced in the Dutch social health insurance sector. Currently the premium subsidies are primarily based on demographic variables. To mitigate the obvious inadequacy of these risk adjusters, the system of risk adjustment is supplemented with a system of risk sharing. This paper describes the main characteristics of the Dutch health care system and the development of risk adjustment and risk sharing in the last decade. The effects of introducing financial risk for Dutch sickness funds on risk selection and consumer mobility are analysed. The paper concludes with a description of expected future developments.

Mandatory pooling as a supplement to risk-adjusted capitation payments in a competitive health insurance market

Risk-adjusted capitation payments (RACPs) to competing health insurers are an essential element of market-oriented health care reforms in many countries. RACPs based on demographic variables only are insufficient, because they leave ample room for cream skimming. However, the implementation of improved RACPs does not appear to be straightforward. A solution might be to supplement imperfect RACPs with a form of mandatory pooling that reduces the incentives for cream skimming. In a previous paper it was concluded that high-risk pooling (HRP), is a promising supplement to RACPs. The purpose of this paper is to compare HRP with two other main variants of mandatory pooling. These variants are called excess-of-loss (EOL) and proportional pooling (PP). Each variant includes ex post compensations to insurers for some members which depend to various degrees on actually incurred costs. Therefore, these pooling variants reduce the incentives for cream skimming which are inherent in imperfect RACPs, but they also reduce the incentives for efficiency and cost containment. As a rough measure of the latter incentives we use the percentage of total costs for which an insurer is at risk. This paper analyzes which of the three main pooling variants yields the greatest reduction of incentives for cream skimming given such a percentage. The results show that HRP is the most effective of the three pooling variants.

Chronic conditions, psychological distress and the use of psychoactive medications.

OBJECTIVE The purpose of this study was to examine whether number and type of chronic conditions are related to psychological distress, fatigue, and the use of psychoactive medications. METHODS Data were taken from a community-based sample of adults who had responded to a health survey mailing (N = 9428). Chronic conditions were assessed by self-report. Information on the use of psychoactive medications was extracted from a claims database of prescribed drugs. Chronic conditions were compared controlling for confounding factors. RESULTS Strong associations were found between the number of chronic conditions, on the one hand, and psychological distress and fatigue, on the other. There was a less strong association between these factors and the use of medication for anxiety and stress, the use of sleeping pills or tranquilizers, and the use of antidepressants. There was only a partial association between type of condition, psychological distress, and fatigue. Migraine had the broadest impact, having an effect on psychological distress and fatigue and on the use of anxiolytics, as well as the use of antidepressants. CONCLUSION The association of chronic conditions with psychological distress, fatigue, and the use of psychoactive medications appeared to be related more to the number of conditions than to the type of condition.