Policy options for controlling rising hospital prices and their outcomes: a framework-based analysis

Area of Science:

• Health Economics
• Health Policy Analysis
• Healthcare Management

Background:

• Rising hospital prices contribute significantly to healthcare spending and can limit patient access.
• Consolidation, inadequate regulation, and inefficient procurement practices exacerbate the issue of escalating hospital costs.

Purpose of the Study:

• To identify and compare policy options for controlling hospital prices using the "Control Knobs" framework.
• To analyze the effectiveness of various policy levers across financing, payment, organization, regulation, and behavior domains.

Main Methods:

• A comprehensive scoping review following PRISMA-ScR guidelines.
• Searched major databases (PubMed, Web of Science, Scopus, Embase, Google Scholar) for English-language studies from Jan 2013 to Jun 2024.
• Synthesized data narratively on policy options and their impact on hospital prices.

Main Results:

• Financing tools like competitive tenders and centralized procurement consistently reduced prices, especially in countries like China and India.
• Payment reforms such as fixed-rate contracts and price caps generally lowered prices, while some organizational changes (e.g., mergers) and specific regulations (e.g., COPAs) had mixed or negative effects.
• Behavioral approaches, including promoting generic and biosimilar entry, were associated with price declines.

Conclusions:

• Effective hospital price control depends on the synergistic interplay of financing, payment, organizational, and regulatory mechanisms.
• Policies that boost competition and purchasing power, such as competitive tendering and merger restrictions, are most effective.
• A coordinated, context-specific approach is crucial for sustainable price control, ensuring both affordability and equity in healthcare.