1. Understanding Cost Implications of the Pennsylvania Department of Health’s Regionalization Process for its Tobacco Control Program Illana Ron 1, Jennifer Thompson 1, Kris Minot 2. 1. Branch Associates, Inc. 123 South Broad St., Phila, PA, 19109 2. Philadelphia Health Management Corporation, 260 S. Broad St., Phila, PA 19102 For more information, please contact: Jennifer Thompson, jthompson@branchassoc.com, 215.731.9980jthompson@branchassoc.com Ilana Ron, iron@branchassoc.com, 215.731.9980iron@branchassoc.com The Tobacco Settlement Act of 2001 established a comprehensive tobacco use prevention and cessation program within the Pennsylvania Department of Health (PA DOH) with funding through the Master Settlement Agreement (MSA). After the first four years, PA DOH embarked on a process to replace the existing structure of local programming at the county level (48 primary contractors responsible for the 67 counties in Pennsylvania) with a regional- level administrative structure consisting of 8 regions and 8 primary contractors. This move towards regionalization was supported by cost and efficiency-related arguments that suggested increased benefits for Pennsylvania's Tobacco Prevention and Control Program including the emergence of economies of scale, an overall reduction of administrative costs, and greater specialization by tobacco control employees. Overview Potential Benefits of Regionalization Reduction of administrative costs at the primary contractor level Reduction of administrative and contract-management tasks for employees of PA DOH Greater specialization of regional contractor employees in substantive tobacco issues Potential Drawbacks of Regionalization Loss of local feel and “fit” in tobacco services and programs Prioritization of urban programs over rural programs Too much responsibility for regional primary contractors Increased political scrutiny from legislators and decision-makers Assessing the Impact of Regionalization Since the move towards regionalization is accompanied by high levels of scrutiny: - Rigorously evaluate the impact of regionalization - Integrate evaluation of regionalization into the overall statewide evaluation plan Key Baseline Data Landscape prior to regionalization Administrative spending by local contractors prior to regionalization Administrative time usage by PA DOH staff prior to regionalization Evaluating the Impact of Regionalization Effects of regionalization on administrative costs and time expenditures Measured by: - Administrative time worksheet (administered on a quarterly basis as of January 2008) to track changes in administrative time usage - Analysis of budget and invoice data about administrative costs for contractors in FY08 - Survey of PA DOH staff about administrative time usage after regionalization Key Questions to Answer How did regionalization change the way in which administrative time is spent for both contractors and PA DOH staff? Were administrative costs lower than in 2002-2006? Were contractor and PA DOH staff able to more successfully acquire substantive tobacco control specialization? Initial findings to be presented based on data collected through June 2008 Key Research Questions to Integrate into Overall Evaluation Do programs after regionalization retain sufficient “local feel?” Do rural counties experience regionalization differently than urban counties? Do regional primary contractors understand the key tobacco needs of their entire region?