What's New with HCFO - July 20, 2005 (Print All Articles)

Hot Topic--Long-Term Care Housing and Service Evolution Addresses “Longevity Revolution”

There are currently 35 million Americans age 65 or older and 78 million baby boomers will turn 65 in six years. As a result, the over-85 segment of the population—nearly half of whom are nursing home residents—is projected to triple by 2050.[i] The increased elderly population does not simply reflect overall population growth; this segment is also becoming a larger proportion of the population. In 2000, one-in-eight U.S. residents was 65 or older, but Census projections anticipate one-in-five residents in that age group by 2030.

The Centers for Disease Control and Prevention has called this age shift a “longevity revolution.”[ii] These demographic trends are amplified by concerns about the mounting costs of traditional long-term care delivery, with the estimated cost for a private room in a nursing home now averaging more than $70,000 a year.[iii]

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Grantee Spotlight--Stephen T. Parente, Ph.D.

Stephen T. Parente, Ph.D., is an assistant professor in the Department of Finance in the Carlson School of Management at University of Minnesota, where he specializes in health information technology, health e-commerce, outcomes research, health economics, and managed care.   Dr. Parente has extensive experience directing empirical analyses using primary and secondary data bases and is acknowledged as a national expert on using administrative databases, particularly Medicare and private insurer data, for health policy research. He has served has a consultant to several of the largest organizations in health care delivery, including UnitedHealth Group, Blue Cross Blue Shield, the Centers for Medicare & Medicaid Services, HealthNet, Pfizer, Janssen Pharmaceutica, Medtronic, the Mayo Clinic, and various state governments and biotechnology firms.  Parente has recently concluded several studies on topics including the impact of Medicare HMO closures on beneficiaries, identifying patterns of controlled substance misuse within managed care plans as a patient safety tool, and the impact of elderly consumer health benefit knowledge of medical care demand and cost. 

He has received two HCFO grants, both which focus on consumer-driven health plans (CDHPs). In his first HCFO project titled, “Evaluation of Defined Contribution Plans on Health Insurance Choice and Medical Care Use,” Parente and his colleagues examined the service use and adverse selection of consumers who select a CDHP, as well as the experience of “early adopters” from both the employer and employee perspective.  This early evaluation of CDHP expenditures and utilization revealed that the new CDHP paradigm is a viable alternative to existing health plan designs. Additionally, this research has shown that enrollees in the CDHP have lower total expenditures than preferred provider organization (PPO) enrollees, but higher utilization of resource-intensive hospital admissions after an initially favorable selection. 

Dr. Parente’s second HCFO project, “The Impact of Multiple Consumer Driven Health Plans Beyond Early Adoption: Here to Stay or Market Fad?” will build on his earlier project outlined above by exploring the long-term impact of CDHPs, specifically their impact on quality of care, cost, utilization, and variation in these outcomes by different CDHP designs, including Health Savings Accounts (HSAs). The objective of this study is to provide objective, empirical analyses of the impacts of CDHPs and newly developing HSA products on consumers. Ongoing findings from these projects are posted at www.ehealthplan.org.

Dr. Parente also holds an adjunct faculty appointment at the Johns Hopkins University. Prior to joining the University of Minnesota faculty, he gained a broad range of private and public sector health finance and policy experience by serving as a legislative fellow in the office of Senator John D. Rockefeller IV (D‑W.V.) during the Bush and Clinton Administrations’ health reform initiatives, and designing provider and health plan financial and quality of care profiles for public and private insurers.   Dr. Parente holds a Ph.D. in healthcare finance and organization from Johns Hopkins University, and a M.P.H, M.S. and B.A. from the University of Rochester-New York. 

HCFO Issue Brief--Health Savings Accounts as a Tool for Market Change

A new issue brief from the Changes in Health Care Financing and Organization (HCFO) initiative takes a look at health savings accounts, one component of consumer-directed health care, from the perspective of markets, employers and employees, insurers, and consumers. It also identifies additional questions for research on HSAs, including issues on data collection, consumer behavior, and the effect on providers. Finally, the brief details ways policymakers and regulators could help "set the stage" for future development and implementation of HSAs.

HCFO Policy Brief--State Pharmacy Assistance Programs at a Crossroads: How Will They Respond to the Medicare Drug Benefit?

This policy brief presents results of a recent study examining the implementation experience of State Pharmacy Assistance Programs (SPAPs) and their initial responses to the new Medicare drug benefit. These results should be of interest to state policymakers examining future options, to federal policymakers implementing and monitoring the new Medicare drug benefit, and to beneficiary groups concerned with consumers’ drug choices and coverage.

Focus on Grantee Publication

A new publication highlighting Bruce Stuart's HCFO-sponsored research helps policymakers understand the implications of the design of the new Medicare Part D drug benefit. "Assessing The Impact Of Coverage Gaps In The Medicare Part D Drug Benefit" examines a representative sample of Medicare beneficiaries with naturally occurring prescription benefit gaps between 1998 and 2000 using data from the Medicare Current Beneficiary Survey. This article by Bruce Stuart, Ph.D., of the University of Maryland at Baltimore, and colleagues appeared this spring as a Web-exclusive on Health Affairs.

Health Policy Orientation: Behind the Scenes of Decision-Making in Washington

Health Policy Orientation: Behind the Scenes of Decision-Making in Washington

October 24 - 27, 2005

Washington, D.C.

Registration deadline: September 30

Attend this three-and-a-half day program to gain an in-depth understanding of formal and informal policymaking processes and the players who shape health policy. The orientation includes presentations by leading experts, group discussions, hands-on tutorials, and a congressional site visit. Speakers are health policy insiders from both sides of the aisle with high-level experience at the White House, Congress, and key health agencies and associations.