1 Introduction and Motivation
International evidence (Australian Productivity Commission Report, 2005[1]) has identified advances in technology as a key driver of health spending. However, the overall impact of a particular innovation remains ambiguous. First, there is the issue of incentives facing each party in question and the regime under which decision makers operate. For instance high levels of regulation may act as a deterrent to the spread of new technology. Second, new technologies typically have both price and coverage effects whereby an advance in technology may reduce the cost of a particular outcome but broaden the scope of patients who can receive the treatment. Consequently, a number of factors influence the spread of technologies across a health sector.
This paper explores how a new health technology diffuses across District Health Boards (DHBs), the price and coverage effects, and whether access is evenly spread across the population i.e. who benefits from a new device or procedure. In doing so it also reveals a number of general issues in the health sector such as differences in policy settings and funding arrangements. These can contribute to:
- a variation in clinical practice between different DHBs;
- a differing degree to which the adoption of a particular technology in one DHB impacts on neighbouring DHBs:
- “domino” effect occurs when the adoption of a technology in one DHB leads to other DHBs following suit
- the adoption of a technology in one DHB leads to increased inter-district flows between DHBs; and
- differences in access between geographical regions and also ethnic groups.
The paper takes the example of a new procedure used in coronary care known as ‘stenting’ (described later in the glossary of terms) and examines its adoption across the different DHBs. Data used pertains to different heart procedures adopted across New Zealand over a particular time frame (1995-2004). It comprises patient details plus information relating to the DHB in which the procedure was carried out and also the patient’s domicile DHB.
This investigation first sets out the literature describing technology diffusion as it relates to coronary care and hence what might be expected with regards to the New Zealand case. The data is then outlined in Section 3 with key results following in Sections 4 and 5. These are used to formulate policy issues in the concluding section.
Notes
- [1]The report cites a number of other studies from Australia, US and UK which measure the impact of technology through a residual from using a regression based analysis. These include Wanless (2001) and Newhouse (1992).
