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An Economic Analysis and Approach for Health Care Preparedness in a Substate Region

Published online by Cambridge University Press:  21 April 2015

Benoit Stryckman ,
Thomas L. Grace ,
Peter Schwarz  and
David Marcozzi
Benoit Stryckman*
Affiliation:
GAP Solutions, Inc (Contractor) Supporting the US Department of Health and Human Services, Washington, DC
Thomas L. Grace
Affiliation:
Hospital and Health System Association of Pennsylvania, Wayne, Pennsylvania
Peter Schwarz
Affiliation:
Abington Memorial Hospital, Abington, Pennsylvania
David Marcozzi
Affiliation:
US Department of Health and Human Services, Washington, DC
*
Correspondence and reprint requests to Benoit Stryckman, US Department of Health and Human Services, Thomas P. O’Neill Federal Building, 200 C Street, SW, Washington, DC 20024, Room C4F11 (e-mail: Benoit.Stryckman@hhs.gov).
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Abstract

Objective

To demonstrate the application of economics to health care preparedness by estimating the financial return on investment in a substate regional emergency response team and to develop a financial model aimed at sustaining community-level disaster readiness.

Methods

Economic evaluation methods were applied to the experience of a regional Pennsylvania response capability. A cost-benefit analysis was performed by using information on funding of the response team and 17 real-world events the team responded to between 2008 and 2013. By use of the results of the cost-benefit analysis as well as information on the response team’s catchment area, a risk-based insurance-like membership model was built.

Results

The cost-benefit analysis showed a positive return after 6 years of investment in the regional emergency response team. Financial modeling allowed for the calculation of premiums for 2 types of providers within the emergency response team’s catchment area: hospitals and long-term care facilities.

Conclusion

The analysis indicated that preparedness activities have a positive return on their investment in this substate region. By applying economic principles, communities can estimate their return on investment to make better business decisions in an effort to increase the sustainability of emergency preparedness programs at the regional level. (Disaster Med Public Health Preparedness. 2015;9:344–348)

Keywords

health policyemergency preparednessrisk assessment
Type
Brief Reports
Information
Disaster Medicine and Public Health Preparedness , Volume 9 , Issue 4 , August 2015 , pp. 344 - 348
Copyright
Copyright © Society for Disaster Medicine and Public Health, Inc. 2015 

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