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

Author

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  • Valerie Moran

    (London School of Hygiene and Tropical Medicine)

  • Rowena Jacobs

    (Centre for Health Economics, University of York)

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.

Suggested Citation

  • Valerie Moran & Rowena Jacobs, 2018. "Investigating the relationship between costs and outcomes for English mental health providers: a bi-variate multi-level regression analysis," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(5), pages 709-718, June.
    • Handle: RePEc:spr:eujhec:v:19:y:2018:i:5:d:10.1007_s10198-017-0915-5
    DOI: 10.1007/s10198-017-0915-5
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    References listed on IDEAS

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    More about this item

    Keywords

    Mental health; Costs; Outcomes; Bi-variate model; Multi-level model; Provider performance;
    All these keywords.

    JEL classification:

    • C55 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Large Data Sets: Modeling and Analysis
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health

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