Chapter 16 The Health Care System Financing, Issues and Trends

6 aims of the IOM to increase quality in health care

(STEEEP) safe, timely, effective, efficient, equitable, pt centered

open access plans

Allow members to see specialist health care providers in the network for treatment without need of a referral. This option may affect the subscriber's coinsurance.

safe

Avoid injuries to pts from the care that is intended to help them.

efficient

Avoid waste of equipment, supplies, ideas, and energy.

Medicare

Federal health insurance plan for Americans 65 years and older and certain disabled persons, must be eligible for Social Security or railroad retirement, Part A covers hospital stays and care in skilled nursing facilities (does not cover long-term care), Part B requires payment of a premium and covers physician services and supplies, offers a prescription drug benefit

PPO (preferred provider organization)

Member pays a premium for a fixed percentage of expense covered, includes deductible and copayment, may select physician, but pays less for physicians and facilities on the plan's preferred list, may or may not pay for preventive care

Fee-for-service (FFS)/indemnity plan

Member pays a premium for a fixed percentage of expenses covered includes deductible and copayment, Allows to choose physician and specialists without restraint, May cover only usual or reasonable and customary charges for treatment and services, with member responsible for charges above that payment, may or may not pay for preventive care

HMO (health maintenance organization)

Member pays a premium, fixed copayment, must select a pcp approved by the HMO, must be referred for treatments, specialists, and services by pcp, Services outside of "network" must be preapproved for payment, may refuse to pay for services not recommended by pcp, Plan encourages use of preventive care

POS (point of service)

Offered by HMO or FFS, Allows use of providers outside the plan's preferred list or network, but requires higher premiums and copayments for services

Coinsurance:

Once a deductible is met, the percentage of the total bill the insured person must pay. The insurance company pays the remainder.

equitable

Provide care that does not vary in quality because of personal characteristics such as gender, ethnicity, geographic location, and socioeconomic status.

pt centered

Provide care that is respectful of and responsive to individual pt preferences, needs, and values, and ensure that pts values guide all clinical decisions.

effective

Provide services based on scientific knowledge to all who could benefit and refrain from providing services to those not likely to benefit.

timely

Reduce waits and sometimes-harmful delays for both those who receive and those who give care

Copayment:

The amount an insured person must pay at the time of an office visit, when picking up a prescription, or before a hospital service.

Premium:

The monthly fee a person must pay for health care insurance coverage.

Deductible:

The yearly amount an insured person must spend out of pocket before a policy will begin to pay its share.

Which statement is true regarding capitation? a) Capitation is a traditional fee-for-service method of payment. b) Capitation is a major way to finance health care services. c) The provider does not absorb any costs. d) The provider always makes a profit.

a) Capitation is a traditional fee-for-service method of payment.

Which is a characteristic of a navigator of change? a) Confident and excited b) Unwilling to participate c) Goes along with change d) Experiences fear

a) Confident and excited

A patient has been seen in a primary care physician's office for several years for sinusitis and other health issues. The patient reports that they are worried about what care they will need because they no longer carry health insurance. The patient is employed, is a middle-income earner, and has a young family. Which factor may have had the most impact on this patient's decision not to carry health insurance? a) Increased cost of premiums b) Age of the patient c) Belief that he does not need health insurance d) Exemplary health status

a) Increased cost of premiums (The rapidly rising cost of health premiums is affecting the middle class and potentially, the ability of the middle class to carry health insurance. Because he has held health insurance in the past and has already experienced health issues, it is unlikely that age is a factor or that he discredits the value of health insurance and believes that he has exemplary health status.)

What services are not included in Medicare Part A? a) Long-term care custodial services b) Hospice care for terminally ill beneficiaries c) Inpatient hospital care d) Twenty days post hospitalization skilled nursing facility care for rehabilitation

a) Long-term care custodial services (The services in options B, C, and D are covered by Medicare Part A.)

Which action can LPNs/LVNs implement to contain the costs of health care? (Select all that apply.) a) Perform nursing procedures accurately and safely. b) Minimize waste in use of supplies. c) Organize care efficiently. d) Provide care according to patient needs. e) Follow agency policy on documenting care for reimbursement.

a) Perform nursing procedures accurately and safely. b) Minimize waste in use of supplies. c) Organize care efficiently. d) Provide care according to patient needs.

What services are not included in Medicare Part B? a) Routine physicals b) Oxygen c) Flu vaccine yearly d) Digital exam every year

a) Routine physicals (B, C, and D are covered by Medicare Part B.)

Medicare Part B helps pay for: a) diagnostic tests. b) prescription drugs. c) inpatient hospital care. d) dental care.

a) diagnostic tests.

Medicare Part A helps pay for: a) inpatient hospital care. b) nursing home custodial care. c) nursing home private rooms. d) ambulance transportation.

a) inpatient hospital care.

A nurse is speaking with the business manager regarding capitation. Which of the following concepts are likely to be discussed during this capitation plan discussion? (Select all that apply.) a. HMOs b. PPOs c. POSs d. Fee-for-service e. Joint purchasing

a. HMOs b. PPOs c. POSs

Student nurses are discussing what is a major driving force in delivering health care today. Which statement indicates the student nurse's need for additional knowledge? a. Technology has almost eliminated the concern for client safety. b. Client access to knowledge and understanding of their health needs contributes to safe care. c. The technological explosion has improved efficiencies of care delivery; however, safety risks remain. d. Family members and the community may be important factors in creating a safe environment.

a. Technology has almost eliminated the concern for client safety.

Under the provisions of the Affordable Care Act, what would be important for a patient without health insurance to know? a) Health insurance is not mandatory for residents and legal citizens. b) All U.S. residents and legal residents must have health insurance or pay a fine. c) Health insurance is not needed if patients only access emergency department services. d) Health insurance coverage can only be denied if you have a serious preexisting health condition.

b) All U.S. residents and legal residents must have health insurance or pay a fine.

The driving force in all health care agencies is quality of patient care, which holds costs within fixed limits. a) True b) False

b) False (Cost containment strategies are used to hold costs within fixed limits while remaining competitive in the health care marketplace.)

The Affordable Care Act established a: a) Medicare program. b) Health Insurance Marketplace. c) free medication program. d) way for the homeless to find care.

b) Health Insurance Marketplace.

Which example best represents continuous quality improvement? a) Examining reasons for a medication error. b) Initiating evidence-based practices and training programs for safe transfer of patients. c) Conducting chart audits to determine if documentation is properly done. d) Reporting the number of adverse events to a clinical review committee.

b) Initiating evidence-based practices and training programs for safe transfer of patients.

A patient has been with a health maintenance organization (HMO) that uses the capitation method of payment. The patient's health has been stable for a number of years while on the capitation plan, and monitoring has included annual screening blood tests. She has just experienced the reoccurrence of a disorder that requires a number of additional diagnostic tests. The patient is worried that the increase in diagnostic tests will mean additional out-of-pocket costs. Which information serves as the basis for your response? a) Under capitation, the patient must pay if costs are more than the monthly fee paid for services. b) Under capitation, the HMO and not the patient will absorb costs for services that are more than the monthly fee. c) Services are guaranteed under the capitation fee and so there will be no reduction in services offered. d) The patient will be discharged from the capitation fee plan because she is no longer healthy.

b) Under capitation, the HMO and not the patient will absorb costs for services that are more than the monthly fee.

Medicaid is: a) funded by Congress each year. b) an entitlement program jointly funded by state and federal governments. c) administered by the federal government. d) an insurance program with two parts.

b) an entitlement program jointly funded by state and federal governments.

Insurance companies charge deductibles, co-payments, and co-insurance to: a) increase costs for patients. b) increase their profit margins. c) increase the cost of prescription medications. d) reimburse physician groups.

b) increase their profit margins.

Group health insurance works by: a) requiring individuals to pay privately. b) pooling individual contributions to protect them from financial disaster due to health care bills. c) acting as a health maintenance organization (HMO). d) paying few patient bills.

b) pooling individual contributions to protect them from financial disaster due to health care bills.

The prospective payment system is: a) the method of payment used by health maintenance organizations. b) the federal government announces to a hospital in advance what it will pay for health care costs. c) the method by which hospitals submit claims to the federal government for compensation. d) a math formula to determine the fee at which the federal government will pay for hospitalization.

b) the federal government announces to a hospital in advance what it will pay for health care costs.

Which act created reformed the health care system? a) Balanced Budget Act of 1997 b) Children's Health Insurance Program c) Affordable Care Act d) Consolidated Omnibus Reconciliation Act

c) Affordable Care Act

Which impact on health care costs occurs when individuals delay treatment because they have insufficient or no health insurance? a) None b) Costs decrease c) Costs increase d) Costs increase for insurance companies

c) Costs increase (Lack of health insurance prevents individuals from receiving preventive care and help when a problem is developing. These individuals may seek care later, usually at greater expense to the system. The impact is felt on the publicly funded system, because uninsured or underinsured individuals seek care from publicly funded services such as emergency rooms.)

Which medical plan involves a mathematical formula that is used to arrive at the fee the government will pay for hospitalization? a) Medicare b) Medicaid c) Diagnosis-related group (DRG) system d) Capitation

c) Diagnosis-related group (DRG) system

Which medical plan provides only prescription drug coverage? a) Medicare Part A b) Medicare Part B c) Medicare Part D d) Medicare Advantage Plan

c) Medicare Part D

Which statement is true regarding the health care system in the United States? a) Life expectancy in the United States is higher than in most industrialized countries. b) Health care costs in the United States are higher because individuals are sicker in the United States than in other countries. c) Nearly 100,000 people die each year from errors in health care that could be prevented. d) Emergency rooms are an inexpensive and accessible approach to treating common illnesses.

c) Nearly 100,000 people die each year from errors in health care that could be prevented.

A patient has been seen by a primary care physician for several years, recently received a diagnosis of cancer and would like a second opinion about treatment. The patient would like to see a specialist about whom they have heard "many good things." The patient is told instead by the insurance company that they must see another specialist in order to have a larger portion of the costs paid. Which explanation indicates the reason for the direction given by the patient's insurance company? a) The specialist whom the patient prefers is not considered competent. b) The specialist to whom the insurance company has directed the patient has a reduced wait list for new patients. c) The specialist to whom the insurance company has directed the patient is a member of a preferred provider network. d) The specialist to whom the insurance company directs the patient is considered more competent than the one she prefers.

c) The specialist to whom the insurance company has directed the patient is a member of a preferred provider network.

An alternative to the fee-for-service method of payment is: a) capitalization. b) inflation. c) capitation. d) Medicaid.

c) capitation.

Two major ways to finance health care services are: a) deductibles and capitation. b) fee-for-service and insurance premiums. c) fee-for-service and capitation. d) government health plans and deductibles.

c) fee-for-service and capitation.

A new nurse is asking questions of her supervisor regarding Medicare coverage. Which of the following statements indicates that the nurse understands how Medicare impacts the PPS? a. Hospitals have increased revenue as a result of the PPS. b. When the client is discharged, the hospital calculates the bill and sends it to the federal government. c. The hospital is paid based on the DRG. d. Health care provider office visits cannot be covered by Medicare funding

c. The hospital is paid based on the DRG.

cost of health insurance

continual rise in health care costs has resulted in annual increases in health insurance premiums for employers. (ACA requires the federal government to create a process in conjunction with states where insurers have to justify unreasonable premium increases.)

Which term identifies the monthly fee a person must pay for health care insurance coverage? a) Coinsurance b) Copayment c) Deductible d) Premium

d) Premium

A resident of a long-term care facility is returned back to the facility after a 2-week acute care hospitalization for severe pneumonia. Which action would reflect understanding of the readmission reduction program by the Centers for Medicare and Medicaid (CMS)? a) Follow the treatment plan established for the resident prior to admission to acute care. b) Consult with the family regarding their wishes for end of life care. c) Call the patient by name before giving the patient oxygen therapy. d) Report an elevated temperature to the RN.

d) Report an elevated temperature to the RN. (Under the readmission reduction program of the CMS, hospitals receive reduced payments when patients are readmitted within 30 days of discharge from hospital for treatment of disorders. LPNs have an important role in preventing readmissions by reporting early complications, such as an increased temp. It is expected that the LPNs follow the treatment plan and that appropriate identification of the resident would occur prior to therapies.)

A client tells the LVN about the new HMO that his employer has chosen to cover employees with health care benefits. Which of the following statements indicate that the client understands the coverage of an HMO? a. "Each time I go to the health care provider, I pay the charges as I leave the office, and I send the bills to the HMO for reimbursement." b. "Having an HMO allows me to choose the specialist I prefer to see, based on my colleagues' referrals." c. "The health care providers hired by the HMO submit their bills to the HMO and receive reimbursement for the services they provided." d. "I must carefully choose a specialist from the list provided or I may incur additional costs."

d. "I must carefully choose a specialist from the list provided or I may incur additional costs."

A client is discussing the ACA with the nurse. Which of the following statements indicate the client understands the ACA? a. The ACA was implemented to expand health care insurance coverage at no cost to the client. b. The ACA mandates that all employers provide health insurance to all employees. c. The ACA replaces Medicare coverage. d. The law prohibits insurance companies from denying coverage if you have a preexisting condition.

d. The law prohibits insurance companies from denying coverage if you have a preexisting condition.

LPN plan

define role in light of assisting role in nursing process, identify what needs to be done, prioritize, collaborate when necessary, identify tasks or protocols that could be done more efficiently, use critical thinking skills

affordable care act

enhanced the access and affordability of health care, established a health insurance marketplace, Est. in 2010, referred to as "Obamacare," was signed into law by President Obama.

national patient safety foundation (NPSF)

est. 1997, pts and those who care for them are free from harm

Medicaid

federal program coverage for low-income persons who are aged, blind, disabled, and certain families with dependent children, delivered and managed by each state for eligibility and scope of services offered, covers long-term care for qualifying individuals

improving cost of health care

follow facility policy for charging pts for supplies used, follow facility policy for documenting pt care for reimbursement, organize pt care for effective and efficient use of time, efficient and effective in delivering pt care, ensure reimbursement and decrease pt stay by preventing complications, meet pt needs not yours, provide pt centered care, p4p and never events impact institution

private health insurance

group health insurance: method of pooling individual contributions for a common group goal: protection from financial disaster as a result of health care bills, offered by employer, Premiums are based on a person's health risk and age.

fee for service

health care providers are paid a fee for each service they provide, traditional method of paying health care bills, providers are directly reimbursed, To improve their margins of profit, insurance companies charge deductibles, copayments, and coinsurance.

the uninsured

include low wage employees, middle class, Many rely on emergency departments for all levels of health care because of lack of insurance.

transition to practice

initiative of the national council of state boards of nursing (NCSBN) to improve the quality and safety of health care by improving the new graduates transition to work

improving quality in health care

inspecting pt incidences of harm or mistakes after they had occurred during care, preventing problems or adverse events, continued competency

payment methods

pay for performance (P4P): rewards hospitals and other entities for meeting and exceeding standards of care for a variety of diseases never events: serious and highly preventable events. (ex: injuries from a fall) Hospitals do not receive any reimbursement, encouraging a proactive approach to preventing errors and promoting a safe environment.

payment for health care services

personal payment, private health insurance, public health insurance, cost of health insurance, the uninsured

the joint commission national patient safety goal (TJC)

promote safety first with pts; do no harm

capitation

set monthly fee charged by the provider for each member of insurance group, HMO/PPO/PO/open access plans, If health care services cost more than the monthly fee, the provider absorbs the cost of those services, At the end of the year, if any money is left over, the health care provider keeps it as a profit.

public health insurance

veterans health administration, medicare, medicaid

dealing with chane

victims look at change in a negative way, survivors resist change but go along for the ride, navigators of change feel in control of the situation