Chapter 11 Economics of Health Care Essay

Chapter 11 The Health Care System Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. U.S. Health Care System Figure 11-1 Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 2 U.S. Health Care System (Cont.)  Private health care subsystem ➢ ➢ ➢ ➢ Focus on the individual Nonprofit and for-profit agencies Models of services • Solo practice • Single specialty group practice • Multispecialty group practice • Integrated health maintenance model • Community health center Voluntary or nonofficial agencies Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 3 U.S. Health Care System (Cont.)  Public health care system ➢ Mandated by the U.S. Constitution ➢ Focus on the population • “promote the general welfare of its citizens.” ➢ Federal policies and practices influence local and state governments ➢ Coordination of services under Department of Health and Human Services Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 4 Public Health Public health refers to the efforts organized by society to protect, promote, and restore the people’s health. ➢ Concerned with a healthy population ➢ Concerned with a healthy environment ➢ Scope is broad ➢ Encompasses activities that promote good health ➢ Organized into multiple levels (federal, state, local) ➢ Provides services for those unable to obtain health care without assistance ➢ Establishes laws, rules, and regulations to protect the public Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 5 Public Health System  Federal level subsystem ➢ ➢ ➢ ➢ U.S. Department of Health and Human Services Surgeon General and numerous other agencies Targets general population, special populations, and international health IOM Report, HHS in the 21st Century: Charting a New Course for a Healthier America (2008), recommended transformation of system Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 6 Current HHS Strategic Plan 1. Transform health care 2. Advance scientific knowledge and innovation 3. Advance health, safety, and well-being of the American people 4. Increase efficiency, transparency, and accountability of HHS 5. Strengthen the nation’s health and human services infrastructure and workforce Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 7 Public Health System (Cont.)  State level subsystem ➢ State health departments ➢ Responsible for the health of their citizens ➢ Central authorities in the public health care system ➢ Dependent on federal level for guidance and resources ➢ Establish own state laws Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 8 Public Health System (Cont.)  Local health department subsystem ➢ Local health departments (LHD) ➢ Responsible for direct delivery of public health services and protection of the health of citizens ➢ Not all communities have LHDs ➢ Responsible for: • Community health services • Environmental health services • Personal health services • Mental health services Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 9 Health Care Providers  Provider organizations ➢  Health care professionals ➢  Any organization that provides health care to the community The interprofessional health care team • Professionals and nonprofessionals Nontraditional health care providers ➢ Complementary and alternative therapies Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 10 Quality Care    To Err Is Human: Building a Safer Health System (IOM, 1999) focused on safety within the health care delivery system Crossing the Quality Chasm (IOM, 2001) focused on developing a new health care system for the twentyfirst century, one that improves care Leadership by Example (IOM, 2003) was a report requested by Congress that examined the federal government’s quality enhancement processes Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 11 Quality Care (Cont.)  Who Will Keep the Public Healthy? (IOM, 2003) brought public health into the forefront by focusing on issues including globalization, rapid travel, scientific and technological advances, and demographic changes ➢ ➢ Chapter 11 Economics of Health Care Essay

In-depth exploration of educational needs for improved public health Need for appropriately prepared public health professionals Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 12 Quality Care (Cont.)  Who Will Keep the Public Healthy? (Cont.) ➢ New content areas for public health professionals: • Informatics, genomics, communication, cultural competence, community-based anticipatory research, global health, policy and law, and public health ethics ➢ Old content areas for public health professionals: • Epidemiology, biostatistics, environmental health, health services administration, and social and behavioral science Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 13 Quality Care (Cont.)  Health Professions Education (IOM, 2003), the education of all health professionals is viewed as a bridge to quality care. ➢ Provide patient-centered care ➢ Work in interdisciplinary teams ➢ Employ evidence-based practice ➢ Apply quality improvement ➢ Utilize informatics Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 14 Quality Care (Cont.)  Priority Areas for National Action (IOM, 2003) identified priority areas that should be addressed to improve quality ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ Patient and family engagement Population health Safety Care coordination Palliative care Overuse Access Health systems infrastructure capabilities Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 15 Quality Care (Cont.) • Keeping Patients Safe: Transforming the Work Environment (IOM, 2004) addressed critical quality and safety issues with a focus on nursing care and nurses • Focused on nurses in acute care and the work • environment for safer patient care Also looked at nursing shortage, health care errors, patient safety risk factors, nurse’s role in quality improvement, and work environment threats to patient safety Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 16 Quality Care (Cont.)  The Future of Nursing. Leading Change, Advancing Health (IOM, 2011) focuses on the nursing profession and how it might fit into the change process 1. Nurses should practice to the full extent of their education and training. 2. Nurses should achieve higher levels of education and training through an improved education system that promotes seamless academic progression. Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 17 Quality Care (Cont.)  The Future of Nursing. Leading Change, Advancing Health (Cont.) 3. Nurses should be full partners with physicians and other health professionals in redesigning health care in the United States. 4. Effective workforce planning and policy making require better data collection and an improved information infrastructure. Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 18 Accreditation   Joint Commission National Committee for Quality Assurance (NCQA) ➢    Health Plan Effectiveness Data and Information Set (HEDIS) American Healthcare Commission Consumer Assessment of Healthcare Providers and Systems (CAHPS) Agency for Healthcare Research and Quality (AHRQ) Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 19 … the ultimate test of the public health subsystem is whether it effectively serves the people by their measurements, not those of the public health profession. – Koop (1989) Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 20 Critical Issues in Health Care Delivery   Managed care Information technology ➢ ➢ ➢  Consumer advocacy and client rights ➢   Telehealth Electronic medical records (EMRs) Social media Client/consumer-centered health care Coordination and access to care Disparity in health care delivery Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 21 Critical Issues in Health Care Delivery (Cont.)  Globalization and international health ➢ World has no real boundaries ➢ CDC active in responding to preparedness and international travel ➢ WHO fosters collaborative global initiatives ➢ ICN gives nursing perspective  Health care reform ➢ ➢ The Clinton Health Reform Initiative Patient Protection and Affordable Care Act of 2010 Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 22 Future of Public Health ● ● ● ● ● What services? Who has access? Who pays? How is it delivered? What is the role of government? Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 23 Impact on Community Health Nursing  Principles of change that focus on quality, access, and cost… ➢ The need for patient-centered care ➢ The need for stronger primary care services ➢ The need to deliver more care in the community ➢ The need for seamless, coordinated care ➢ The need for reconceptualized roles for health professionals ➢ Chapter 11 Economics of Health Care Essay

The need for interprofessional collaboration – The Future of Nursing. Leading Change, Advancing Health (IOM, 2011) Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 24 Chapter 12 Economics of Health Care Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. Factors Influencing Health Care Costs          Historical payment systems Unnecessary use of services Lack of preventive care Lifestyle/health behaviors Societal belief that disease would be eradicated Technological advances Aging of society Utilization of drugs Shift from nonprofit to for-profit health care Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 2 Public Financing of Health Care: Medicare Entitlement program to provide health care to the growing population of those 65 years of age or older  Part A ➢ ➢ ➢ Includes inpatient care in hospitals/skilled nursing facilities, hospice care, some home health care Must pay a deductible for health services Does not pay for all health care costs of enrollees; co-payments required after 60 days Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 3 Public Financing of Health Care: Medicare (Cont.) Entitlement program to provide health care to the growing population of those 65 years of age or older  Part B ➢ Purchased by monthly fee ➢ Not compulsory ➢ Helps pay for out-of-pocket costs for physician services, hospital outpatient care, durable medical equipment, and other services, including some home health care ➢ Enrollees must pay deductibles and coinsurance Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 4 Public Financing of Health Care: Medicare (Cont.) Entitlement program to provide health care to the growing population of those 65 years of age or older  Part C ➢ Medicare Advantage Plans ➢ Optional “gap” coverage ➢ Provided by private insurance companies approved by, and under contract with, Medicare ➢ May include HMOs and PPOs ➢ May include vision, hearing, dental care, and other services not covered by Medicare Parts A, B, or D Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 5 Public Financing of Health Care: Medicare (Cont.) Entitlement program to provide health care to the growing population of those 65 years of age or older  Part D ➢ Initiated in 2006 to help defray costs of prescription drugs ➢ Optional; must enroll in an approved prescription drug plan ➢ Monthly premium, deductibles, and co-payments ➢ Must pay 100% of costs when costs reach “coverage gap” or “donut hole” Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 6 Public Financing of Health Care: Medicaid Title XIX of the Social Security Act—a public welfare assistance program     Provides universal health care coverage for the indigent and children A joint state and federal venture Eligibility for this program depends on the size and income of the family; federal government sets baseline eligibility requirements, but states can lower eligibility Priority participation is given to children, pregnant women, and the disabled Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 7 Public Financing of Health Care: Medicaid (Cont.)  Federal government sets baseline services, but state governments may provide more services ➢   Must include inpatient and outpatient hospital care, pregnancy-related care, vaccines for children, family planning services, rural health clinics, home health care, lab and x-ray services, and EPSDT Care by pediatric and family nurse practitioners is covered Children under 18 also eligible for Children’s Health Insurance Program (CHIP) Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 8 Public Financing of Health Care: Governmental Grants       Directed toward funding large populations and different aggregates Historically for health promotion and disease prevention measures Administered by DHHS “Block grants” provided to states to impact the health of the public as a whole Health care providers and programs compete for funds through grant proposals and applications Closely related to Healthy People 2020 objectives Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 9 Philanthropic Financing of Health Care   Often research or disease oriented Eligibility for services limited to the specific disease or population of interest ➢ ➢ ➢ Chapter 11 Economics of Health Care Essay

May include services rendered plus ancillary needs like transportation, parental housing, or wigs Informational and research activities constitute the majority of services provided by these organizations Examples include American Heart Association and the Shriners Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 10 Health Insurance Plans   First established in 1930s Types of plans ➢ ➢  Reimbursement mechanisms ➢  Indemnity, HMO, PPO, POS Private insurance, cooperatives, cafeteria plans Retrospective and prospective plans Scope of services covered ➢ Routine care, catastrophic, ambulatory Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 11 Cost Containment  Capitated reimbursement ➢  Access limitation ➢ ➢  Prospective reimbursement for services Primary care provider as gatekeeper Managed care plans—preauthorization requirements for additional services Rationing ➢ Determining the most appropriate use of health care or directing the health care where it can do the most good Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 12 Trends in Health Financing New and innovative health care approaches  Cost sharing  Health alliances  Self-insurance  Flexible spending accounts  Health promotion and disease prevention Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 13 Health Care Financing Reform Lack of insurance is the major factor associated with lack of access to medical care. The current dilemma is how to provide health care to all Americans that is acceptable and affordable. Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 14 Caring for the Uninsured   Should health care be one of those necessities available to all without cost? Should health care be a right for all rather than a commodity to be available only to those who can afford it? Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 15 Access to Health Care—Barriers   Insufficient financial support Physical barriers ➢ Structural inaccessibility, lack of appropriate equipment, or inability to communicate ➢ Inequality in the distribution of services, transportation difficulty, conflict with work hours, and failure to provide services  Sociological barriers ➢ Language difficulties and fear of reprisals Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 16 Health Care Reform 2010         Individual mandate Employer requirements Expansion of Medicaid Expansion of CHIP Premium and cost-sharing subsidies to individuals Changes to private insurance Cost-containment provisions Prevention and wellness Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 17 Nurse’s Role in Economics  Researcher ➢ ➢ Investigate efficient, cost-effective care, culturally sensitive treatment modalities, health education, disease prevention, and factors to change behaviors Investigate, develop, and evaluate the effectiveness of health promotion and disease prevention Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 18 Nurse’s Role in Economics (Cont.)  Educator ➢ ➢ ➢ ➢ Health education is the foundation of community health nursing practice Understand that knowledge empowers clients to actively participate in their health care Demonstrate the effectiveness and value of education Outcome measures for health education need to be established Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 19 Nurse’s Role in Economics (Cont.)  Provider of care ➢ Care must be appropriate, necessary, and cost effective. ➢ Judicious application of the nursing process is imperative. ➢ Serve as program service provider, health education provider, and heath program participant ➢ Participate in grant proposal process, program design, and evaluation of these programs ➢ Participate in statistical information–gathering process as basis for determining needs Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 20 Nurse’s Role in Economics (Cont.)  Advocate ➢ Become more involved in the economics of health care ➢ Increase knowledge of health care funding and policy making ➢ Use political power to influence health care funding ➢ Advocate for increase in health promotion/disease prevention funding ➢ Plan programs, seek funding, and evaluate program effectiveness through outcome measures Copyright © 2015, 2011, 2007, 2001, 1997, 1993 by Saunders, an imprint of Elsevier Inc. 21 …