1
A framework for international comparisons of volume and prices in health care
Interim Report
Manfred Huber
7th Meeting of HA Experts and Correspondents for Health
Expenditure Data
2
Overview of presentation
Objectives of the project of health specific PPPs (H-PPPs)
Expenditure classifications for price comparisons
Potential data sources: Where are we? What’s missing?
Aggregation strategies for multilateral comparisons
Which role for quality adjustment?
Conclusions & Next steps
3
The project of price and volume comparisons: objectives
Set of comparative indicators at different levels of aggregation (ICHA-HC [three]/two/one digit level)
Indicators for bilateral comparisons Simple comparisons of volume measures with
unweighted OECD averages But also aggregation to Indicators for multilateral
comparisons.. ..for Improved purchasing power parities for health
(H-PPPs) (“health-specific” PPPs)
4
Basic definitions (SNA terminology)
Expenditure = price x volume Value: synonym to “expenditure” Quantity: units for homogenous, individual goods or
services Volume: weighted average of quantities of individual
products or groups of products Output: volume of well-defined bundle of goods
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Expenditure classifications for price comparisons: ICHA
ICHA-HC Expenditure category for H-PPP ICHA-HF source of funding
function of health care
HF.1 HF.2HF.2.1 + HF.2.2
HF.2.3 HF.2.4
Gen
eral
gov
ernm
ent
Priv
ate
sect
or
Priv
ate
insu
ranc
e
Priv
ate
hous
ehol
d ou
t-of
-poc
ket
expe
nditu
re
Non
-pro
fit
orga
nisa
tions
se
rvin
g ho
useh
olds
HC.1.1; 1.2; 2.1; 2.2;
10.00 In-patient curative and rehabilitative care including day cases
HC.1.3;1.4; 2.3 ; 3.4
20.00 Curative and rehabilitative care: ambulatory, outpatient & home care
HC.1.3.1 20.01 Basid medical and diagnostic servicesHC.1.3.2 20.02 Dental careHC.1.3.3 20.03 All other specialised health careHC.1.3.9 20.04 All other ambulatory and outpatient care
HC.3.1; 3.2; 3.3 30.00 Long-term care services
HC.3.1 30.01 Long-term care in institutionsHC.3.2; HC.3.3 30.02 Long-term care: home care
Pro
po
sed
gro
up
ing
fo
r H
-PP
Ps
6
Expenditure classifications for price comparisons: ICHA (cont)
HC.4 40.00 Ancillary services to health care (1)
HC.5 50.00 Medical goods in ambulatory care (2)
HC.5.1.1/2 50.01 PhamaceuticalsHC.5.1.1 50.01.1 Prescribed medicinesHC.5.1.2 50.01.2 Over-the-counter medicinesHC.5.1.3 50.02 Other medical non-durables
HC.5.2 50.03 Therapeutical appl.; other medical durablesHC.5.2.1 50.03.1 Glasses and other vision productsHC.5.2.2 50.03.2 Orthopaedic appliances; other prostheticsHC.5.2.3-5.2.9 50.03.3 All other misc. durable medical goods
HC.6; HC.7 60.00 Public health and health administrationHC.6 60.01 Prevention and public health servicesHC.7 60.02 Health administration and health insurance
HC.1-HC.7 Total current expenditure on health care
(1) This item includes freestanding clinical laboratory; diagnostic imaging; and patient transport.(2) Included are fitting of prosthesis; eye tests and other services of providers of these goods.
Note: HF.2.5 (enterprises) and HF.3 (rest of the world) have been excluded from the picture
HF.1 HF.2HF.2.1 + HF.2.2
HF.2.3 HF.2.4
Gen
eral
gov
ernm
ent
Priv
ate
sect
or
Priv
ate
insu
ranc
e
Priv
ate
hous
ehol
d ou
t-of
-poc
ket
expe
nditu
re
Non
-pro
fit
orga
nisa
tions
se
rvin
g ho
useh
olds
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Four estimation methods and their data requirements
Price Quantity
Input Detailed expenditures on inputs (labour and intermediate inputs); average salary data of selected occupations (1)
Detailed expenditures on inputs (labour and intermediate inputs); numbers of workers in selected occupations
Output Detailed set of unit prices for market prices; alternatively imputed prices of selcted services (cost estimates) for non-market services
Detailed list of selected services; representative mapping to expenditure categories
Source: adapted from Tandon et al. (2002, Table 4)
(1) The Eurostat-OECD comparisons collect for this purpose data on 17 input items, among which are 3 salary items.
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Method of choice ?
Unit prices for market services (in particular for medical goods)
Indirect comparison for non-market services via output measures from (secondary) administrative data sources suggested for the H-PPP project
Input price method for non-market services (Eurostat-OECD, 2002 PPPs)
But: non-market/market distinction in SHA-based health accounts not available..
..and what about expenditure corresponding to transaction prices for mixed public-private payment (cost-sharing)?
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Expenditure classification: ICHA modified
ICHA-HC Expenditure category for H-PPP Source of funding adapted for price comparisons
function of health care
HF.1 HF.2.3 HF.1 HF.2.3HF.2.1 + HF.2.2
HF.2.3 HF.2.4
Gov
ernm
ent o
wn
prod
uctio
n
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ate
hous
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stsh
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g
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ernm
ent f
rom
pr
ivat
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ctor
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ate
hous
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stsh
arin
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Priv
ate
insu
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Priv
ate
hous
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d ou
t-of
-poc
ket
expe
nditu
re "
over
th
e co
unte
r"
Non
-pro
fit
orga
nisa
tions
se
rvin
g ho
useh
olds
HC.1.1; 1.2; 2.1; 2.2;
10.00 In-patient curative and rehabilitative care including day cases
HC.1.3;1.4; 2.3 ; 3.4
20.00 Curative and rehabilitative care: ambulatory, outpatient & home care
HC.1.3.1 20.01 Basid medical and diagnostic servicesHC.1.3.2 20.02 Dental careHC.1.3.3 20.03 All other specialised health careHC.1.3.9 20.04 All other ambulatory and outpatient care
HC.3.1; 3.2; 3.3 30.00 Long-term care services
HC.3.1 30.01 Long-term care in institutionsHC.3.2; HC.3.3 30.02 Long-term care: home care
HC.4 40.00 Ancillary services to health care (1)
HC.5 50.00 Medical goods in ambulatory care (2)
Pro
po
sed
gro
up
ing
fo
r H
-PP
Ps
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Which are the “shortcuts” used for health in current PPPs?
ICHA-HC Expenditure category for H-PPP Source of funding adapted for price comparisons
function of health care
HF.1 HF.2.3 HF.1 HF.2.3HF.2.1 + HF.2.2
HF.2.3 HF.2.4
Pro
po
sed
gro
up
ing
fo
r H
-PP
Ps
Go
vern
men
t o
wn
p
rod
uct
ion
Pri
vate
ho
use
ho
ld
cost
sh
arin
g
Go
vern
men
t fr
om
p
riva
te s
ecto
r
Pri
vate
ho
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ld
cost
sh
arin
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ate
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Pri
vate
ho
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ld
ou
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f-p
ock
et
exp
end
itu
re "
ove
r th
e co
un
ter"
Non
-pro
fit
orga
nisa
tions
ser
ving
ho
useh
olds
HC.1.1; 1.2; 2.1; 2.2;
10.00 In-patient curative and rehabilitative care including day cases
HC.1.3;1.4; 2.3 ; 3.4
20.00 Curative and rehabilitative care: ambulatory, outpatient & home care
HC.1.3.1 20.01 Basid medical and diagnostic servicesHC.1.3.2 20.02 Dental careHC.1.3.3 20.03 All other specialised health careHC.1.3.9 20.04 All other ambulatory and outpatient care
HC.3.1; 3.2; 3.3 30.00 Long-term care services
HC.3.1 30.01 Long-term care in institutionsHC.3.2; HC.3.3 30.02 Long-term care: home care
HC.4 40.00 Ancillary services to health care (1)
HC.5 50.00 Medical goods in ambulatory care (2)
HC.5.1.1/2 50.01 PhamaceuticalsHC.5.1.1 50.01.1 Prescribed medicinesHC.5.1.2 50.01.2 Over-the-counter medicinesHC.5.1.3 50.02 Other medical non-durables
HC.5.2 50.03 Therapeutical appl.; other medical durablesHC.5.2.1 50.03.1 Glasses and other vision productsHC.5.2.2 50.03.2 Orthopaedic appliances; other prostheticsHC.5.2.3-5.2.9 50.03.3 All other misc. durable medical goods
HC.6; HC.7 60.00 Public health and health administrationHC.6 60.01 Prevention and public health servicesHC.7 60.02 Health administration and health insurance
13.02.11.3
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Cat
egor
ies
of in
put p
rices
(in
clud
ing
3 s
taff
cat
ego
ries)
11.06.23.113.02.12.3
13.02.12.2
13.02.11.0
11.06.31.0
13.02.12.1
11.06.11.0
11.06.22.0
(13.02.12.3) (11.06.23.1)
12.
02.1
1.0
11.06.21.0
13.02.11.1 11.06.11.1
11.06.13.1
13.02.12.4
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Current specification of health in PPPs
Detailed list of market prices for medical goods and selected ambulatory/outpatient services (~540 of which 85% are pharmaceuticals
Advantages: questionnaire with very detailed specifications, tested in the field
Potential to complement list of ambulatory services (e.g. put in more services which correspond to current/latest technology; more expensive treatment)
E.g. complement unit-prices for long-term care
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Example of detailed specification: pharmaceutical
77 06.1.1.0b07 Aspirin ATC Code: B01AC06, N02BA01Active principle: Acetylsalicylic acidStrength: 100 mgDosage form: Tablet(s)Quantity: 20 tab
78 06.1.1.0b08 Nu-seals (Aspirin anti-inflammatory), Hjertemagnyl
ATC Code: B01AC06, N02BA01
Active principle: Acetylsalicylic acidStrength: 300 mgDosage form: Tablet(s)Quantity: 100 tab
79 06.1.1.0b09 Nu-seals (Aspirin), Hjertemagnyl ATC Code: B01AC06, N02BA01Active priciple: Acetylsalicylic acidStrenght: 75 mgDosage form: Tablet(s)Quantity: 56 - 100 tab
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Example of detailed specification: home care
Assistant nurse: home visit Patient type: Elderly, handicappedDuration: ± 60 minTiming: Normal working hoursService: Qualified nurse supervision. Help with personal hygiene, administering light treatment, cleaning and tidying of home, giving of instructionsService distance: 5 kmLocation: At home of patient
Nurse: home visit Patient type: Elderly, handicappedDuration: ± 15 minTiming: Normal working hoursService: Routine health check, dispensing of medicines, giving of instructionsService distance: ± 5 kmLocation: At home of patient
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Example of detailed specification: dental care
Dentist: Routine check-up Duration: ± 15 minTiming: Normal working hoursService: Routine check-up, normal scaling and polishing, no other treatmentService excluded: X-rayAvailability: By appointmentLocation: At surgery
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How to improve PPPs and move to H-PPPs?
Focus on “comparative resistant” item of hospital care Big spending item, not covered well in current PPPs Select inpatient care items: high spending items;
dynamic spending development (ageing/chronic conditions); e.g. surgery like: hip/knee replacement
Complement ambulatory care list with high volume surgical procedures (cataract etc.)
Further develop indicators for long-term care
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Potential data sources
Use of secondary data sources: survey too costly? Design hospital data set with a view to provide relevant
data for H-PPP purposes Same for long-term care Health care quality indicators project: many indicators
refer to volumes (often measuring times, “right thing is done”)
Co-operate with main PPPs project to improve available items in questionnaire and for quality checking?
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Calculation and aggregation: standard methods of linking countries
Comparison of four countries with a multilateral average
Complete system of bilateral comparisons
Source: Hill (2002) Linking Countries and Regions using Chaining Methods and Spanning Trees
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Linking countries with (minimum) spanning trees
Examples of spanning trees
Source: Hill (2002) Linking Countries and Regions using Chaining Methods and Spanning Trees
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Example of spanning tree
Source: Hill (2002) Linking Countries and Regions using Chaining Methods and Spanning Trees
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Which role for quality adjustment?
Quality differences important issue that needs to be addressed
Direct adjustment versus post-adjustment/analysis? Suggestion to keep volume/output/quality separate for
the first phases of the project Later on, test regression models before “adjustments”
can be justified Hedonic regression technique for PPPs available, but
seldom used so far; should be tested once more data available
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Conclusions and next steps
Project of H-PPPs major undertaking, potentially resource intensive
Better linking of SHA to SNA becomes a concern Synergy with overall PPP project? Break project down in manageable parts Get countries involved in bilateral comparisons to
improve quality, commitment and save cost? Need to write down the math on index formulas to be
tested and do first tests with hospital data
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Points for discussion
Comments on conceptual framework Data availability and feasiblity from national sources Interest to participate in further methodological work
and work with test data