costs

Question 1

health outcomes

Answer 1

the end result of medical care
what happens to the patient

Question 2

three outcome categories

Answer 2

the six D’s:

Clinical (death, disease)
economic (dollars)
humanistic (disability, discomfort, dissatisfaction)

Question 3

different types of clinical outcomes

Answer 3

intermediary (HbA1c, BP)
patient-oriented (MI, stroke, hospitalization, cure, death)

Question 4

health economics vs pharmacoeconomics

Answer 4

health economics: applies concepts to health and health care outcomes (BROAD)

pharmacoeconomics: applies concepts to pharmaceuticals or pharmacy services (SPECIFIC)

Question 5

drivers of higher healthcare costs in the US

Answer 5

inpatient/outpatient care
prescription drugs
health administration

Question 6

what is universal health care coverage

Answer 6

all people have access to the full range of quality health services they need, when and where they need them, without financial hardship. covers the full continuum of essential health services. however, more taxes

Question 7

3 factors that drive growth in prescription drug spending

Answer 7

newly marketed drugs
price changes of existing agents
increases in utilization

Question 8

what must happen for an intervention to be sustainable

Answer 8

improvement of outcomes must outweigh the costs of the intervention

Question 9

true/false: the price of a drug is the same thing as its costs

Answer 9

false

Question 10

true/false: in the US we have a single-payer system

Answer 10

false: there is no single source for obtaining health care costs

Question 11

what are charges

Answer 11

charge= cost + profit
the amount a provider bills a patient or payer for a product/service

Question 12

what are RCCs

Answer 12

ratio of cost-to-charge

Question 13

how to calculate RCC costs

Answer 13

(charge for item) x (RCC)

Question 14

types of costs

Answer 14

direct, indirect, intangible

Question 15

what is a direct medical cost

Answer 15

costs of services or products associated directly with a medical intervention (ex hospital stay, drugs)

Question 16

what is a direct non-medical cost

Answer 16

cost of providing non-medical assistance, food, lodging, and transportation because of the medical intervention

Question 17

what are indirect costs

Answer 17

cost of lost or reduced productivity resulting from morbidity or premature mortality due to a medical condition or intervention

Question 18

morbidity costs

Answer 18

goods and services not produced by the patient because of illness

Question 19

mortality costs

Answer 19

goods and services the person could have produced had the illness not been incurred and the person not died prematurely

Question 20

intangible costs

Answer 20

costs assigned to the amount of suffering that occurs because of the disease or intervention

Question 21

fixed vs variable costs

Answer 21

fixed: do not vary with quantity or volume of output in the short run (1 year). usually vary with time. includes things like rent, equipment leases, salary

variable: costs that vary with changes in output volume– the more you buy, the better the deal (drugs, devices, supplies)

Question 22

mean cost

Answer 22

total costs of the healthcare intervention/total quantity of the intervention provided

Question 23

major sources of cost data

Answer 23

external (literature/studies, databases, websites)
internal (payer, hospital, pharmacy)

Question 24

sources of drug pricing

Answer 24

average wholesale price (AWP)
wholesale acquisition cost (WAC)

Question 25

average wholesale price

Answer 25

a figure reported by commercial publishers of drug pricing data, based on wholesale pricing info provided to them by drug manufacturers

Question 26

wholesale acquisition cost

Answer 26

the manufacturer’s list price (charge) for the drug to the wholesalers or direct purchasers

does not reflect discounts or rebates

Question 27

preferred sources of drug pricing

Answer 27

medicare average sales prices (reflects actual prices after price concessions & discounts)
federal supply schedule

Question 28

things to know about AWP

Answer 28

most plans use this to calculate reimbursements to pharmacies

frequently used in PE studies

derived from databases from self-reported manufacturer data on brand/generic drugs

not defined by federal law

intended to be the average price wholesalers sold medications to physicians and pharmacies

behind the scene discounts and rebate programs

sales price and contracts may be held confidentially

Question 29

hospital drug cost issues

Answer 29

-drug acquisition/contract price is the actual price paid by a specific institution
-costs for drugs administered in the hospital are usually bundled w/ other services
-drug costs vary by package size & manufacturer
-may be highly variable
-drug acquisition costs are commonly used for institution-specific PE analysis

Question 30

_____ is a common practice in hospitals that is a very important pharmacy issue

Answer 30

cost-shifting
the costs of newer, more effective drugs increase the pharmacy budget

Question 31

hospital cost shifting

Answer 31

-most costs incurred by a department are directly associated with that department
-departments that do not generate revenue must assign their expenses to revenue-generating departments that charge patients for their services
-spending more money in one department might save costs in a different department: a new expensive drug may increase costs for pharmacy but DECREASE overall hospital costs

Question 32

work measurement techniques

Answer 32

work sampling
stopwatch time

Question 33

work sampling

Answer 33

momentary observation at pre-selected times; then the % of time devoted to each activity is determined

useful for non-repetitive tasks

Question 34

stopwatch time

Answer 34

time and motion
directly measures time required to complete a specific task

useful for repetitive tasks

Question 35

how do physicians typically bill for outpatient services

Answer 35

AMA CTP codes (current procedural terminology)

Question 36

ICD-10 codes

Answer 36

internal classification of diseases
used to classify and code all diagnoses, symptoms, and procedures associated with hospital care

assigned at discharge for the entire patient encounter