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Martin Roland: Supply Induced Demand
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Martin Roland: Supply Induced Demand

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Professor Martin Roland of Cambridge Centre for Health Services Research (CHSR), University of Cambridge, talks about supply-induced demand in health care. He explains that improving care usually …

Professor Martin Roland of Cambridge Centre for Health Services Research (CHSR), University of Cambridge, talks about supply-induced demand in health care. He explains that improving care usually costs more and that policy changes often have unintended consequences.

Professor Roland spoke at the event: "Supply induced demand as it relates to general practice" (http://www.nuffieldtrust.org.uk/talks/supply-induced-demand-it-relates-general-practice) in March 2014.


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  • Aberdeen, York, Manchester (compared to Scotland)
  • Transcript

    • 1. Supply induced demand (2) Martin Roland University of Cambridge
    • 2. If you pay providers to do things, they’ll do them GP minor surgery following the 1990 GP contract: - increased by 41% - no decrease in hospital referrals for minor surgery Lowy et al BMJ 1993; 307: 413-417.
    • 3. If you pay providers to do things, they’ll do them Impact of payment by results - annual increase in acute and elective admissions of between 1.3% and 2.5% Farrar et al. BMJ 2009; 339: b3047
    • 4. Things don’t always work out the way you want Change in emergency admissions p value Evercare1 +16% 0.14 Integrated care pilots 2 +9% 0.02 Impact of intensive case management on emergency admissions for high risk patients 1 Gravelle et al. BMJ 2007; 334: 31 2 Roland et al. Int J Integrated Care 2012; 24 July
    • 5. It’s much easier to improve quality than to reduce cost % of studies with a positive outcome for health % of studies with positive outcome for patient experience % of studies which showed reduction in cost 55% 45% 18% Powell Davies et al Med J Aust 2008; 188 (8): S65-S68 Systematic review of interventions to improve coordination in healthcare
    • 6. Investing £1 in care homes results in £0.35 reduction in hospital expenditure Forder J. Health Economics 2009; 18: 1322
    • 7. Things to remember • If you pay people to do things they’ll do them • There’s always potential for unintended consequences, including supply induced demand • Improving care usually costs more • The easiest way to reduce cost is to do less • If you want to reduce cost without reducing quality, you need to be smart
    • 8. “To avoid disappointment, employ people in pairs”

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