Miron Stano

An analysis of the evidence on competition in the physician services markets.

By comparing aggregated physician utilization data in Michigan with a disaggregated measure of the intensity with which physicians treat their patients, the article shows that the availability effect found in many studies of the physician services markets is due to the larger number of providers seen by patients in physician dense markets. Although the aggregated data are consistent with the concept of induced demand, the data from individual practices do not indicate that doctors treat their patients more intensively as the availability of physicians increases. The paper discusses and interprets these results within the context of current issues in health care policy.

Aging Baby Boomers and the Rising Cost of Chronic Back Pain: Secular Trend Analysis of Longitudinal Medical Expenditures Panel Survey Data for Years 2000 to 2007

OBJECTIVES The purposes of this study were to analyze data from the longitudinal Medical Expenditures Panel Survey (MEPS) to evaluate the impact of an aging population on secular trends in back pain and chronicity and to provide estimates of treatment costs for patients who used only ambulatory services. METHODS Using the MEPS 2-year longitudinal data for years 2000 to 2007, we analyzed data from all adult respondents. Of the total number of MEPS respondent records analyzed (N = 71,838), we identified 12,104 respondents with back pain and further categorized 3842 as chronic cases and 8262 as nonchronic cases. RESULTS Secular trends from the MEPS data indicate that the prevalence of back pain has increased by 29%, whereas chronic back pain increased by 64%. The average age among all adults with back pain increased from 45.9 to 48.2 years; the average age among adults with chronic back pain increased from 48.5 to 52.2 years. Inflation-adjusted (to 2010 dollars) biennial expenditures on ambulatory services for chronic back pain increased by 129% over the same period, from

Patient Attitudes, Insurance, and Other Determinants of Self-Referral to Medical and Chiropractic Physicians

15.6 billion in 2000 to 2001 to

Chiropractic and medical costs of low back care.

35.7 billion in 2006 to 2007. CONCLUSION The prevalence of back pain, especially chronic back pain, is increasing. To the extent that the growth in chronic back pain is caused, in part, by an aging population, the growth will likely continue or accelerate. With relatively high cost per adult with chronic back pain, total expenditures associated with back pain will correspondingly accelerate under existing treatment patterns. This carries implications for prioritizing health policy, clinical practice, and research efforts to improve care outcomes, costs, and cost-effectiveness and for health workforce planning.

A further analysis of the physician inducement controversy

OBJECTIVES This study identified predictors of patient choice of a primary care medical doctor or chiropractor for treatment of low back pain. METHODS Data from initial visits were derived from a prospective, longitudinal, nonrandomized, practice-based observational study of patients who self-referred to medical and chiropractic physicians (n = 1414). RESULTS Logistic regression showed differences between patients who sought care from medical doctors vs chiropractors in terms of patient health status, sociodemographic characteristics, insurance, and attitudes. Disability, insurance, and trust in provider types were particularly important predictors. CONCLUSIONS The study highlights the importance of patient attitudes, health status, and insurance in self-referral decisions. The significance of patient attitudes suggests that education might be used to shape attitudes and encourage cost-effective care choices.

Sources of small area variations in the use of medical care

This study compares health insurance payments and patient utilization patterns for episodes of care for common lumbar and low back conditions treated by chiropractic and medical providers. Using 2 years of insurance claims data, this study examines 6,183 patients who had episodes with medical or chiropractic first-contact providers. Multiple regression analysis, to control for differences in patient, clinical, and insurance characteristics, indicates that total insurance payments were substantially greater for episodes with a medical first-contact provider. Most of the cost differences were because of higher inpatient payments for such cases. Analysis of recurrent episodes indicates that chiropractic providers retain more patients for subsequent episodes and that patient exposure to a different provider type during early episodes significantly affects retention rates for later episodes. Patients choosing chiropractic and medical care were comparable on measures of severity and in lapse time between episodes. The lower costs for episodes in which chiropractors serve as initial contact providers along with the favorable satisfaction and quality indicators for patients suggest that chiropractic deserves careful consideration in gatekeeper strategies adopted by employers and third-party payers to control health care spending. More research is needed, especially in developing alternative measures of health status and outcomes.

Evaluating the policy role of the small area variations and physician practice style hypotheses

This article extends several recent contributions that have compared the physician-induced demand hypothesis to the theory of a monopoly where advertising is included as a decision variable. By introducing a standard profit-maximizing model with inducement, it derives the conditions for the optimum level of inducement to show that the controversy over inducement is directly related to the elasticity of demand for the physicians services. In particular, inducement is likely to be prevalent only where the individual physician has a high degree of monopoly power as measured by its elasticity of demand. It will disappear entirely as competitive conditions are approached. Furthermore, the article argues that a physicians level of induced output is likely to diminish, and not increase as others have suggested, following increases in physician supply.

Efficacy and economics of hormonal therapies for advanced breast cancer.

This paper develops an economic model of physician care utilization which incorporates the uncertainty and practice style hypotheses proposed by Wennberg and others as explanations of the substantial intermarket variations in per capita utilization rates of many medical and surgical procedures. Practice style, which is distinguished from inducement, is modeled as a set of physician beliefs about the production function of health. In the model, per capita utilization is decomposed into a first occurrences demand and an intensity demand. It is argued that the influence of practice style affects primarily the intensity with which physicians treat their patients. Alternative tests are proposed and carried out on a comprehensive aggregated measure of physician care utilization for market areas in Michigan. Although practice style is undoubtedly important for some individual procedures, the empirical results indicate that it is unimportant in determining either an aggregated index of market area utilization or the average intensity with which patients are treated by physicians.

Clinical surveillance for early stage breast cancer: an analysis of claims data.

The primary purpose of this article is to develop a framework for reinterpreting the role of physician practice style in the small area variations phenomenon. This phenomenon deals with the wide interarea variations in per capita use rates which have been found for many medical and surgical procedures. The variations have been interpreted by many to suggest that large amounts of unnecessary care are being provided. The variations and corresponding perceptions of unnecessary care have also led to a US health policy which is increasingly emphasizing patient outcomes research. I show, however, that most of the empirical studies of the variations phenomenon have inappropriately aggregated either across procedures or across market areas so as to obscure the role of practice style. Its role has also been obscured by the common failure to distinguish practice style from other determinants of utilization. As a result, small area methods can lead to substantial error in identifying procedures associated either with major differences in practice style or with substantial amounts of unnecessary care if all variation is attributed to practice style.

An analysis of the cost of clinical surveillance after primary therapy for women with early stage invasive breast cancer.

Breast cancer is a leading cause of cancer-related mortality among postmenopausal women in the US, and the economic burden of breast cancer care comprises a large percentage of the healthcare budget. Hormonal therapies have a proven place in the management of advanced breast cancer. This type of therapy is more likely to be used in older, compared with younger, women, because tumours in older women are more likely to express estrogen and progesterone receptors. While it is difficult to measure the costs of cancer care because of variation in extent and duration of treatment, treatment-related costs including costs of hormonal agents used for advanced disease account for a relatively small component of the overall costs. Newer hormonal regimens such as the new third generation nonsteroidal (letrozole, an-astrozole) and steroidal (exemestane) aromatase inhibitors have shown improved clinical efficacy compared with standard regimens such as megestrol and tamoxifen in the metastatic setting in terms of objective responses or time to tumour progression. In addition the newer agents have improved toxicity profiles. Cost analyses of the newer aromatase inhibitors (anastrozole and letrozole), compared with megestrol, show an optimistic outlook for these agents. Additional work needs to be done looking at a comparison of the efficacy and costs of the aromatase inhibitors relative to the currently recommended hormonal treatments used for women with metastatic breast cancer.