One of the most persistent and important questions in international comparisons of health systems pertains to the wide divergence in costs between countries. Japan has significantly lower per capita health care costs than does the United States, despite having a fee-for-service reimbursement system and universal coverage, and aggressively purchasing and utilizing equipment-embodied medical technologies. 1 One important factor in the increase in American health care costs over time has been the substitution of surgical intervention for medical treatment. 2 This leads us to consider differential rates of surgery as a potential explanation for divergent cost performances. Indeed, although Japan has one-half the inpatient admission rate of the United States, it has only one-quarter the surgery rate per capita

Studies of hospital demand and choice of hospital have used straight line distance from a patient's home to hospitals as a measure of geographic access, but there is the potential for bias if straight line distance does not accurately reflect travel time. Travel times for unimpeded travel between major intersections in upstate New York were compared with distances between these points. The correlation between distance and travel time was 0.987 for all observations and 0.826 for distances less than 15 miles. These very high correlations indicate that straight line distance is a reasonable proxy for travel time in most hospital demand or choice models, especially those with large numbers of hospitals. The authors' outlier analyses show some exceptions, however, so this relationship may not hold for studies focusing on specific hospitals, very small numbers of hospitals, or studies in dense urban areas with high congestion and reliance on surface streets.

We use newly released data on Japanese hospitals to explore patients’ perceptions of hospital quality, the implications of these assessments for the structure of demand for hospital care, and the role of the availability and quality of hospital care in influencing access. We find that the primary influences on hospital choice for Japanese patients are interpersonal aspects of care, that Japanese hospital markets are not segmented, and that availability has no influence on access. These results are interpreted in light of institutional differences between the Japanese and American health care systems.

Background: The California Diabetes and Pregnancy Program is a new preventive approach to improving pregnancy outcomes through intensive diabetes management preconception and early in pregnancy.

Methods: Hospital charges and length of stay data were collected on 102 program enrollees and 218 control cases. Ninety program enrollees and 90 control cases were matched on mother's age. White's classification, and race. Regression models controlled for these variables in addition to MediCal status, birth weight, and enrollment in the program.

Results: Hospital charges were about 30% less for program participants and days in the hospital were roughly 25% less. The program effects were larger for women that enrolled before 8 weeks gestation. More serious diabetics were also found to have larger reductions in charges and days.

Conclusion: After adjusting for inflation and differences in charges across hospitals, $5.19 is saved for every dollar spent on the program.

Many neonates are referred to neonatal intensive care units (NICUs) for specialized care far from their parents' residence. This distance can add to the stress of the parents and reduce the contact of the parents with their newborn. Small studies have found that back transporting these neonates to hospitals closer to their homes is safe and cost-effective. Despite these findings, the reluctance of many insurers to pay for back transports prevents or delays many back transports. Insurers may not consider the findings of the previous studies to be conclusive, given that the comparisons were between small numbers of neonates back transported and neonates who remained in tertiary care, and the potential for differences in severity of illness between the groups is significant. In this study the effect on hospital charges of back transports was examined by comparing the charges for care in community hospitals with what these charges would have been in a tertiary care center. The advantage of this method is that it avoids case-mix differences between the groups and thus minimizes the potential for small-sample bias. Data were collected for all back transports from a NICU to non-tertiary care centers (n = 90) for a 9-month period. We were able to obtain the itemized bills for the care at community hospitals for 42 of these patients. Each bill was recalculated using the charges for the NICU to determine potential for savings. The average charges for recovery care were about $6200 lower at the community hospital than they would have been at the NICU.

The authors apply a conditional choice model to simulate the results of patient and physician choices of hospitals for a specific surgical procedure in response to improvements in quality or changes in charges. The model includes all zip code areas and relevant hospitals in a large metropolitan area and estimates the impact on admissions at each hospital. It can be used to estimate both the impact of decisions by a given hospital and the potential responses of competitors, as well as the effects of selective contracting with hospitals by certain payors.

If a person were faced with a medical problem requiring a risky operation, it would be natural, even prudent, for that person to want to know the comparative experience with the procedure (as shown by annual volumes) and the relative success with which area hospitals perform the operation. Unfortunately, such information is often impossible for the average consumer or even the average employee benefits manager to obtain.

Various studies have shown that certain complicated procedures are volume-sensitive. That is, when hospitals perform higher volumes of the procedure, morality rates and charges decline. This relationship is said to reflect experience and economies of scale. While some argue that such quality and cost information can easily be misinterpreted, consumers deserve as much information as can be made available to help them determine where to obtain care. Unfortunately, hospitals believe that information regarding their quality and efficiency is proprietary and should not be released, and they have been quite successful at guarding hospital-specific information.