DaCHE discussion papers,
University of Southern Denmark, Dache - Danish Centre for Health Economics

Abstract: Objectives: This study investigates cost and quality implications of pushing regular monitoring of moderateseverity type 2 diabetes (T2D) patients away from specialized hospital clinics into general practice(GP). Methods: 152,630 hospital- and 21,361 GP-monitored T2D patients with moderate disease severity werealgorithmically identified in Danish administrative databases in 2016. Total annual healthcare costis decomposed into GP, medication, nonhospital-specialist, hospital outpatient and inpatient costs.Emergency hospitalizations are used to proxy for quality of care. Cost and quality impacts oftreatment loci are assessed using an instrumental variable (IV) analysis. A wide range of patientconfounders are used to reduce selection bias, with distance to nearest hospital diabetes clinic usedas an instrument to control for remaining endogeneity of treatment locus. Two-part models areused for zero-inflated outcomes. Results: Hospital monitoring is associated with higher total annual healthcare costs (64.0%, p Conclusion: For type 2 diabetes patients with moderate disease severity, IV analysis controlling for treatmentlocus endogeneity bias identifies an expected efficiency improvement (average cost reductionwithout reduction of quality) of moving regular disease management from hospital-based settingto primary care.

Keywords: Type 2 diabetes; Disease management; Cost; Quality of care; Administrative data

JEL-codes: I18

26 pages, June 25, 2020

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