A new study co-authored by a University of California, Irvine, economics professor suggests costs can be cut over time by enrolling uninsured people in healthcare benefits comparable to those offered under federal reforms set to take effect in 2014.
UC Irvine’s David Neumark and representatives of Virginia Commonwealth University Health System tracked the use of hospital services by 26,000 uninsured residents of Richmond, Va., between 2000 and 2007. Those participating in the project had incomes below 200% of the federal poverty line.
Participants were granted health insurance through a community-based program, assigned a primary-care doctor for a year and required to re-enroll for subsequent coverage.
The study found that primary care visits for patients who enrolled continuously for three years rose from 1.06 in year one to 1.6 annually, while emergency room visits fell from 1.02 in the first year to 0.74 in the third. Costs per visit for both inpatients and outpatients also fell, as did the length of inpatient stays.
On average, total healthcare costs per enrollee per year for the group were cut nearly in half—from $8,899 in the first year to $4,569 in the third year. Overall costs per enrollee per year for all study participants with at least one year of enrollment fell from $7,604 to $4,726.
“We found that use of primary care increased but use of emergency services fell, and—over time—total healthcare costs declined,” Neumark said.
Study demos paralleled those of the overall U.S. population who will be affected by changes under federal healthcare reforms via the Affordable Care Act of 2010. The reforms will extend Medicaid benefits to about 16 million uninsured, low-income adults and children by the end of 2014.
“Costs can be reduced through increased use of primary care and reductions in emergency department visits and hospital admissions,” Neumark said. “But it may take several years of coverage for substantive savings to occur.”
Findings appeared in the February issue of Health Affairs, an industry journal.
$32.5M for Building
Griffin-American Healthcare REIT II, a Newport Beach-based real estate investor and owner, bought Spokane Integrated Medical Plaza in Spokane, Wash., for $32.5 million.
Spokane Integrated has five stories, 96,000 square feet of space and is 97% leased to a pair of tenants—a subsidiary of Franklin, Tenn.-based hospital operator Community Health Systems Inc., and to Northwest Orthopaedic Specialists, a large medical group. It was built in 2004 by Medistar Corp., a Houston real estate development company.
Griffin-American bought it from Medistar Spokane Medical Center LLC, an unaffiliated third party. Philip Camp and Jay Miele of New York investment bank Hammond Hanlon Camp LLC represented Medistar Spokane.
Trial Results
Aliso Viejo drug maker Avanir Pharmaceu-ticals Inc. said its AVP-923 drug candidate was effective in relieving peripheral neuropathic pain in people with diabetes.
Avanir said 379 patients in a 13-week, randomized, controlled clinical trial received AVP-923 or a placebo once daily for seven days and twice daily thereafter.
The results showed efficacy in those patients, with adverse events being mostly mild or moderate in character, the drug maker said.
AVP-923 is made up of a pair of common medications: dextromethorphan, a cough medicine, and quinidine, which fights arrhythmia. It is approved in the form of Avanir’s Neudexta drug for treating sudden, involuntary outbursts of laughing or crying brought on by diseases such as amyotrophic lateral sclerosis or multiple sclerosis.
But Avanir said it is putting that usage on the back burner to concentrate on testing AVP-923 for central neuropathic pain in multiple sclerosis patients.
Bits and Pieces
Irvine-based Endologix Inc. said it completed enrollment in a clinical trial for the use of its medical devices for use in a bilateral, percutaneous approach to endovascular abdominal aortic aneurysm repair. … Louise White is the new vice president, patient care services and chief nursing officer at Children’s Hospital of Orange County. White comes to the Orange pediatric hospital from Eisenhower Medical Center in Coachella Valley. She replaces Dana Bledsoe, who relocated out of state. … Lake Forest-based Insight Imaging said Lafayette Surgical Specialty Hospital in Lafayette, La., signed a multi-year mobile imaging contract. Aviir Inc., an Irvine developer of tests to assess people’s risks for heart attacks, and Guard a Heart, a nonprofit heart disease education foundation, are going to honor retired talk show personality Larry King on Feb. 25. Aviir said King was being honored for his work with the Larry King Cardiac Foundation.
