Investigating the relationship between costs and outcomes for English mental health providers: a bi-variate multi-level regression analysis

Original Paper

Abstract

Provider payment systems for mental health care that incentivize cost control and quality improvement have been a policy focus in a number of countries. In England, a new prospective provider payment system is being introduced to mental health that should encourage providers to control costs and improve outcomes. The aim of this research is to investigate the relationship between costs and outcomes to ascertain whether there is a trade-off between controlling costs and improving outcomes. The main data source is the Mental Health Minimum Data Set (MHMDS) for the years 2011/12 and 2012/13. Costs are calculated using NHS reference cost data while outcomes are measured using the Health of the Nation Outcome Scales (HoNOS). We estimate a bivariate multi-level model with costs and outcomes simultaneously. We calculate the correlation and plot the pairwise relationship between residual costs and outcomes at the provider level. After controlling for a range of demographic, need, social, and treatment variables, residual variation in costs and outcomes remains at the provider level. The correlation between residual costs and outcomes is negative, but very small, suggesting that cost-containment efforts by providers should not undermine outcome-improving efforts under the new payment system.

Keywords

Mental health Costs Outcomes Bi-variate model Multi-level model Provider performance 

JEL Classification

C55 I18 

Notes

Acknowledgements

This work is funded by a Centre for Health Economics (University of York) PhD Studentship held by Valerie Moran. Under a Data Sharing Agreement with NHS Digital the MHMDS dataset is released on condition that it is not shared with any third party. Copyright © 2011/2012–2012/13, re-used with the permission of NHS Digital. All rights reserved.

References

  1. 1.
    Kobel, C., et al.: DRG systems and similar patient classification systems in Europe. In: Busse, R., et al. (eds.) Diagnosis-Related Groups in Europe moving towards transparency, efficiency and quality in hospitals. Open University Press, England (2011)Google Scholar
  2. 2.
    Swan-Tan, S., et al.: DRGs and cost accounting: which is driving which? In: Busse, R., et al. (eds.) Diagnosis-Related Groups in Europe Moving towards transparency, efficiency and quality in hospitals. Open University Press, England (2011)Google Scholar
  3. 3.
    Mason, A., Goddard, M.: Payment by results in mental health: a review of the international literature and an economic assessment of the approach in the English NHS. CHE Research Paper 50, 2009Google Scholar
  4. 4.
    Jacobs, R.: Payment by results for mental health services: economic considerations of case-mix funding. Adv. Psychiatr. Treat. 20, 155–164 (2014)CrossRefGoogle Scholar
  5. 5.
    Monitor and NHS England: 2014/15 National Tariff Payment System. Monitor, London (2013)Google Scholar
  6. 6.
    Trauer, T.: Outcome measurement—applications and utility. In: Trauer, T. (ed.) Outcome measurement in mental health theory and Practice. Cambridge University Press, UK (2010)CrossRefGoogle Scholar
  7. 7.
    Wing, J.K., Curtis, R.M., Beevor, A.S.: HoNOS—Health of the Nation Outcome Scales: report of research and development. Royal College of Psychiatrists Research Unit, London (1996)Google Scholar
  8. 8.
    Self, R., Painter, J., Davis, R.: A report on the development of a mental health currency model, (including suggestions on the development and testing of PbR tariffs). Department of Health, London (2008)Google Scholar
  9. 9.
    Monitor and NHS England: Guidance on mental health currencies and payment. Monitor, London (2013)Google Scholar
  10. 10.
    Department of Health Payment by Results team: Mental Health Payment by Results Guidance for 2013–14. Department of Health, Leeds (2013)Google Scholar
  11. 11.
    England, N.H.S., Improvement, N.H.S.: 2017/18 and 2018/19 National Tariff Payment System: a consultation notice. NHS Improvement, London (2016)Google Scholar
  12. 12.
    Department of Health: Reference Costs 2011–12. Department of Health, Leeds (2012)Google Scholar
  13. 13.
    Dickey, B., Normand, S.L.: Toward a model for testing the relationship between quality of care and costs. J. Ment. Health Policy Econ. 7(1), 15–21 (2004)PubMedGoogle Scholar
  14. 14.
    Haas, L., et al.: The trade-off between costs and quality of care in the treatment of psychosomatic patients with somatoform pain disorder. Appl. Health Econ. Health Policy 11(4), 359–368 (2013)CrossRefPubMedGoogle Scholar
  15. 15.
    Hendryx, M.: State mental health funding and mental health system performance. J. Ment. Health Policy Econ. 11(1), 17–25 (2008)PubMedGoogle Scholar
  16. 16.
    Schulz, R.I., Greenley, J.R., Peterson, R.W.: Management, cost, and quality of acute inpatient psychiatric services. Med. Care 21(9), 911–928 (1983)CrossRefPubMedGoogle Scholar
  17. 17.
    Carey, K., Burgess Jr., J.F.: On measuring the hospital cost/quality trade-off. Health Econ. 8(6), 509–520 (1999)CrossRefPubMedGoogle Scholar
  18. 18.
    Schreyogg, J., Stargardt, T.: The trade-off between costs and outcomes: the case of acute myocardial infarction. Health Serv. Res. 45(6 Pt 1), 1585–1601 (2010)CrossRefPubMedPubMedCentralGoogle Scholar
  19. 19.
    Weech-Maldonado, R., Shea, D., Mor, V.: The relationship between quality of care and costs in nursing homes. Am. J. Med. Qual. 21(1), 40–48 (2006)CrossRefPubMedGoogle Scholar
  20. 20.
    Hvenegaard, A., et al.: Exploring the relationship between costs and quality: does the joint evaluation of costs and quality alter the ranking of Danish hospital departments? Eur. J. Health Econ. 12(6), 541–551 (2011)CrossRefPubMedGoogle Scholar
  21. 21.
    Gutacker, N., et al.: Truly inefficient or providing better quality of care? Analysing the relationship between risk-adjusted hospital costs and patients’ health outcomes. Health Econ. 22(8), 931–947 (2013)CrossRefPubMedGoogle Scholar
  22. 22.
    Hauck, K., Street, A.: Performance assessment in the context of multiple objectives: a multivariate multilevel analysis. J. Health Econ. 25(6), 1029–1048 (2006)CrossRefPubMedGoogle Scholar
  23. 23.
    Gutacker, N., Street, A.: Multidimensional performance assessment using dominance criteria. CHE Research Paper 115, 2015Google Scholar
  24. 24.
    Rabash, J., et al.: MLwiN Version 2.1. 2009, Centre for Multilevel Modelling: University of BristolGoogle Scholar
  25. 25.
    Goldstein, H.: Restricted unbiased iterative generalized least-squares estimation. Biometrika 76(3), 622–623 (1989)CrossRefGoogle Scholar
  26. 26.
    Leckie, G,. Charlton, C.: runmlwin: a program to run the MLwiN multilevel modeling software from within Stata. J. Stat. Softw. 52(11), 1–40 (2012)CrossRefGoogle Scholar
  27. 27.
    StataCorp, Stata 13.0. 2014, StataCorp LP.: College Station, TexasGoogle Scholar
  28. 28.
    The Commission to review the provision of acute inpatient psychiatric care for adults, Improving acute inpatient psychiatric care for adults in England. Interim report. The Commission to review the provision of acute inpatient psychiatric care for adults (2015)Google Scholar
  29. 29.
    Sabes-Figuera, R., et al.: Developing a tool for collecting and costing activity data on psychiatric inpatient wards. Epidemiol. Psychiatr. Sci. 21(4), 393–399 (2012)CrossRefPubMedPubMedCentralGoogle Scholar
  30. 30.
    Csipke, E., et al.: Inpatient care 50 years after the process of deinstitutionalisation. Soc. Psychiatry Psychiatr. Epidemiol. 49(4), 665–671 (2014)CrossRefPubMedGoogle Scholar
  31. 31.
    House of Commons Health Committee: Post-legislative scrutiny of the Mental Health Act 2007 first report of session 2013–14. House of Commons, London (2013)Google Scholar
  32. 32.
    Dow, M.G., Boaz, T.L., Thornton, D.: Risk adjustment of Florida mental health outcomes data: concepts, methods, and results. J. Behav. Health Serv. Res. 28(3), 258–272 (2001)CrossRefPubMedGoogle Scholar
  33. 33.
    Rosen, A.K., et al.: Improving risk adjustment of self-reported mental health outcomes. J. Behav. Health Serv. Res. 37(3), 291–306 (2010)CrossRefPubMedGoogle Scholar
  34. 34.
    Hendryx, M.S., Dyck, D.G., Srebnik, D.: Risk-adjusted outcome models for public mental health outpatient programs. Health Serv. Res. 34(1 Pt 1), 171–195 (1999)PubMedPubMedCentralGoogle Scholar
  35. 35.
    Kramer, T., et al.: Comparing outcomes of routine care for depression: the dilemma of case-mix adjustment. J. Behav. Health Serv. Res. 28(3), 287–300 (2001)CrossRefPubMedGoogle Scholar
  36. 36.
    Health and Social Care Information Centre: Lower layer super output area. NHS data dictionary. Health and Social Care Information Centre, Leeds (2013)Google Scholar
  37. 37.
    Noble, M., McLennan, D., Wilkinson, K., Whitworth, A., Barnes, H., Dibben, C.: The English indices of deprivation 2007. Communities and Local Government, London (2008)Google Scholar
  38. 38.
    NHS England and NHS Improvement: Linking quality and outcome measures to payment for mental health Technical Guidance. NHS Improvement, London (2016)Google Scholar
  39. 39.
    Yeomans, D.: Clustering in mental health payment by results: a critical summary for the clinician. Adv. Psychiatr. Treat. 20, 227–234 (2014)CrossRefGoogle Scholar
  40. 40.
    Jencks, S.F., et al.: Bringing excluded psychiatric facilities under the Medicare Prospective Payment System. A review of research evidence and policy options. Med. Care 25(9 Suppl), S1–S51 (1987)PubMedGoogle Scholar
  41. 41.
    PriceWaterhouseCoopers: An evaluation of the reimbursement system for NHS-funded care: report for monitor. PriceWaterhouseCoopers LLP, UK (2012)Google Scholar

Copyright information

© Springer-Verlag GmbH Germany 2017

Authors and Affiliations

  1. 1.London School of Hygiene and Tropical MedicineLondonUK
  2. 2.Centre for Health Economics, University of YorkYorkUK

Personalised recommendations