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Open Access 01-08-2019 | Care | Original Paper

The closer the better: does better access to outpatient care prevent hospitalization?

Authors: Péter Elek, Tamás Molnár, Balázs Váradi

Published in: The European Journal of Health Economics | Issue 6/2019

Abstract

In 2010–2012, new outpatient service locations were established in poor Hungarian micro-regions. We exploit this quasi-experiment to estimate the extent of substitution between outpatient and inpatient care. Fixed-effects Poisson models on individual-level panel data for years 2008–2015 show that the number of outpatient visits increased by 19% and the number of inpatient stays decreased by 1.6% as a result, driven by a marked reduction of potentially avoidable hospitalization (PAH) (5%). In our dynamic specification, PAH effects occur in the year after the treatment, whereas non-PAH only decreases with a multi-year lag. The instrumental variable estimates suggest that a one euro increase in outpatient care expenditures produces a 0.6 euro decrease in inpatient care expenditures. Our results (1) strengthen the claim that bringing outpatient care closer to a previously underserved population yields considerable health benefits, and (2) suggest that there is a strong substitution element between outpatient and inpatient care.

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The decision to apply for EU-financed expansions had to do with the obligation of the local government to maintain the new outpatient units, financed with fee-for-service point reimbursement, which is a function of the expected number of patients. The latter could be estimated from geography, population density, and the location of other healthcare providers.

The previous study of Elek et al. [5], which focused on short-term patterns of outpatient care, used 21 control micro-regions. In the current analysis, we exclude the micro-region of Szikszó, because acute inpatient care was abolished in its hospital during our examined period. The matched inpatient–outpatient data, used in the current study, had not yet been available at the time of writing of the past paper.

The data set covers only those people who appeared at least once in outpatient or inpatient care between 2008 and 2015. This is a negligible restriction for two reasons. First, other administrative data (the linked labor-health panel data set processed by the Institute of Economics, Centre for Economic and Regional Studies of the Hungarian Academy of Sciences, see, e.g. Bíró and Elek [2] for its health variables) suggest that less than 2.5% of the (18–74 years old) inhabitants of the examined micro-regions did not appear at all in either outpatient or inpatient care during another 8 year long period (2003–2011). Second, we use fixed-effects Poisson and logit models in our main analysis, and the always zero observations drop out in the estimation of these models.

As a robustness check, we also defined PAH following the European Collaboration for Healthcare Optimization (ECHO) project [22], which examines hospitalization due to angina, congestive heart failure, and strictly defined diabetes complications for people at least 40 years old, asthma and COPD for people at least 18 years old, and dehydration complications for people at least 65 years old. Our results do not change substantially when this alternative definition is used.

We note that the original data refer to only those inpatient events that started and also terminated within 2008–2015, and therefore, some inpatient stays are missing for 2015. All figures in the paper show the adjusted data for 2015 by assuming that inpatient events with year of discharge different from year of admission constituted the same share of all inpatient events in 2015 as in 2013–2014. This adjustment increases inpatient case numbers by only 1.2%, and does not affect substantially our later results. For details, see "Appendix 2".

Individual-level expenditures are approximated based on the financing rules of the Hungarian health care system, but they cannot be calculated precisely from the data at hand, because some financial variables of minor importance are missing. Hence, our results on expenditures only give rough estimates on the financial interactions between outpatient and inpatient care.

The nearest substantial hospital is defined as the most frequent place of inpatient stay of the population of a micro-region.

This is in line with the short-term results by Elek et al. [5], who could only examine the outpatient data up until 2012 (and inpatient data were not available then) and could not distinguish the various outpatient diagnoses.

Comparison of outpatient and inpatient spending is further complicated by the fact that drugs prescribed in ambulatory care are partially financed by out-of-pocket co-payment by the patient, whereas, in inpatient care, the full cost of medication is borne by the hospital and, thus, factored into the amount of the reimbursement. However, aggregate pharmaceutical consumption trends are roughly parallel in the treated and control group, so this effect is negligible.

These specifications do not contain the treatment dummy, only the travel time to the nearest location, because the former is not statistically significant when the latter is included in the regression.

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Title: The closer the better: does better access to outpatient care prevent hospitalization?
Authors: Péter Elek
Tamás Molnár
Balázs Váradi
Publication date: 01-08-2019
Publisher: Springer Berlin Heidelberg
Keyword: Care
Published in: The European Journal of Health Economics / Issue 6/2019
Print ISSN: 1618-7598
Electronic ISSN: 1618-7601
DOI: https://doi.org/10.1007/s10198-019-01043-4

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