U.S. Health Care System Chapter 1 notes and highlights
The U.S. system is different from other developed countries
-It is not centrally controlled; central systems are less complex, less costly. -It has different payment, insurance, and delivery mechanisms. -Health care is financed both publicly and privately.
An MCO functions like an insurance company
-It promises to provide health care services contracted under the health plan to the enrollees of the plan.
"Health care delivery" refers to the
-Major components of the system -Processes that enable people to receive health care -Provision of health care services to patients
In a free market
-Multiple patients (buyers) and providers (sellers) act independently. -Patients should be able to choose their provider based on price and quality.
Special populations, or vulnerable populations
-Persons with health needs but inadequate resources to address them, including: The poor and uninsured Minority groups Of a certain immigration status Geographically or economically disadvantaged communities
The key system players have been:
-Physicians -Administrators of health care institutions -Insurance companies -Large employers Government
TriCare
Financed by the military and covers families, dependents, or retired military
•Socialized health insurance systems
Germany uses this style -Health care is financed through government-mandated contributions by employers and employees. -Health care is delivered by private providers. -Sickness funds collect and pay for services. -Insurance and payment is closely integrated. -Delivery characterized by independent, private arrangements. -Government exercises overall control.
Medicare
One of the largest sources of public health insurance in the United States -Serves the elderly, the disabled, and those with end-stage renal disease
Health care is experiencing a
Paradigm shift to integrated, patient-centered care
VA system's mission
Provide medical care, education and training, research, contingency support, and emergency management
. Why is the U.S. health care market referred to as "imperfect"?
The U.S. health care market is imperfect because it does not meet the classical criteria of a free market: (1) The health plans acting as intermediaries for the patients typically function as buyers of health care services. (2) Patients lack the information necessary to make prudent decisions. They generally do not know which new diagnostic methods, intervention techniques, and drugs are available. Information on price and quality is also extremely difficult to get. (3) Prices are often set by the health plans. They are not determined by the interaction of the forces of supply and demand. (4) The consolidation of buying power into the hands of private health plans is forcing providers to form alliances and integrated delivery systems on the supply side, thus restricting competition at the individual level. (5) Health insurance shields patients against the cost of health care. Health insurance does not always serve the purpose of true insurance, which is to protect against catastrophic risks. For basic and routine care, health insurance acts as prepayment for health services. There is a moral hazard that once enrollees have purchased health insurance, they will utilize health care services. (6) The utilization of health care is generally determined by need rather than price-based demand. Providers can often induce demand for their own financial benefit.
Health Care Reform (ACA)
ACA = Affordable Care Act •Goal is to expand coverage and increase access to care -ACA Medicaid expansion and subsidized insurance •ACA effects: -41 million uninsured Americans in 2013; 27 million uninsured Americans in 2016 -Increased coverage, improved access and financial security, and economically benefited states and providers -No-cost coverage for preventative services from private insurance plans •Failed attempts to repeal ACA
The VA is organized into
•23 geographically distributed Veterans Integrated Service Networks (VISN). •Each VISN: -Coordinates its own services Receives federal funds
Integrated Systems
•A network of health care providers and organizations that provides coordinated health care to a population -Responsible for the health outcomes and health status of the population •Objective: To have one health care organization deliver a range of services for a defined population
Military Medical Care System
•Available mostly free of charge to: -Active duty military personnel of the U.S. Army, Navy, Air Force, and Coast Guard -Certain uniformed nonmilitary services such as the Public Health Services and NOAA
Legal Risk Influences Practice Behavior
•Because Americans are quick to file lawsuits, many health care providers practice defensive medicine, taking extra precautions, such as: -Prescribing additional diagnostic tests -Scheduling extra checkup appointments -Maintaining abundant documentation on cases •This contributes to increased health expenditures and inefficiency in the health system
Long-Term Care
•Consists of medical and nonmedical care. -Provided to individuals who are chronically ill or who have a disability. •Most LTC services are not covered by Medicare. •Difficult to meet requirements to access LTC insurance. •By 2020, more than 12 million Americans are projected to require LTC.
Managed Care (MCO)
•Dominant health care delivery system in the United States and available to most Americans. •Employers and government are the primary financiers.
Government as Subsidiary to the Private Sector
•In most developed countries, government plays a central role in the provision of health care. •In the United States, the private sector plays the dominant role because of American tradition and the desire to limit government.
Subsystems of U.S. Health Care Delivery
•Managed care •Military •Vulnerable populations •Integrated delivery •Long-term care Public health
Market Justice and Social Justice: Conflict Throughout Health Care
•Market justice and social justice are two contrasting theories that govern the production and distribution of health care services in the United States.
Access to Health Care Services Based on Insurance Coverage
•Medical care is usually only available to: -Those who have health insurance with adequate coverage -Individuals who can afford to pay out of pocket •The uninsured are left with having to: -Pay physicians out of pocket -Seek care from safety net providers -Obtain treatment for acute illness at emergency departments
Health Care Systems of Other Developed Countries
•Most of Western Europe has universal access. •Models for national health systems: -National health insurance -National health system -Socialized health insurance system
Key Characteristics of the U.S. Health Care System
•No central governing agency; little integration and coordination •Technology driven and focuses on acute care •High on cost, unequal in access, and average in outcomes •Imperfect market conditions for health care delivery •Government as subsidiary to the private sector •Fusion of market justice and social justice •Multiple players and balance of power •Quest for integration and accountability •Access to health care selectively based on insurance •Legal risk influences practice behavior.
What are the two main objectives of a health delivery system?
The primary objectives of any health delivery system are to enable all citizens to receive health care services whenever needed and to deliver health services that are cost-effective and meet preestablished standards of quality
Safety net services
•Safety nets are not secure. -Varying availability of services: Some individuals must forgo care or seek hospital emergency services if nearby. -Pressure on providers from an increased number of uninsured individuals.
Managed Care
•Seeks to achieve efficiency by integrating the basic functions of health care delivery •Employs mechanisms to control (manage) utilization of medical services •Determines the price at which the services are purchased and how much the providers get paid
What is the purpose of the systems framework? Name and define the main elements of the systems framework.
The systems framework is used to help understand the structure of health care services in the United States, which is based on several foundations; to provide a logical arrangement of the various components; and to demonstrate a progression from inputs to outputs. 1. System foundations: cultural beliefs and values; historical developments 2. System resources: human and nonhuman resources necessary 3. System processes: the continuum of care and special populations 4. System outcomes: critical issues and concerns about health service's accomplishments relative to its primary objective; change and reform
MCO Enrollee refers to
an indiviual covered under the plan
Technology Driven and Focused on Acute Care
•The United States invests in research and innovations in new medical technology. •Growth in science and technology helps create demand for new services, despite shrinking resources to finance sophisticated care. •Technology has had successful interventions but is overused. •This prohibits employers from extending benefits to part-time workers and insurers lowering premiums.
High in Cost, Unequal in Access, and Average in Outcome
•The United States spends more than any other developed country on health care. -Costs continue to rise at an alarming rate. -Many have limited access to basic care. •The absence of insurance inhibits a patient's ability to receive well-directed, coordinated, and continuous care to primary and specialty services if referred. •Access is the ability of an individual to obtain health care services when needed.
Medicaid
•Third largest source of health insurance in the United States -Provides coverage for low-income adults, children, the elderly, and the disabled
The U.S. health care delivery system is
complex and massive
What are the 10 characteristics of the U.S. health care system?
(1) no central governing agency, little integration and coordination; (2) technology-driven and focused on acute care; (3) high on cost, unequal in access, and average in outcome; (4) quasi/imperfect market conditions; (5) government as subsidiary to the private sector; (6) market justice vs. social justice: conflict through health care; (7) multiple players and balance of power; (8) quest for integration and accountability; (9) access to health care selectively based on insurance coverage; (10) legal risk influence practice behavior
The VA system
-2017 budget of $68.6 billion -Employs more than 360,000 people
•National health insurance
-Canada uses this system. -Core of care is delivered by private providers. -There is tighter consolidation of financing, coordinated by government.
The United States has a unique system of health care delivery
-Continuous and comprehensive care is not enjoyed by all Americans. -It's a patchwork of subsystems. No country has a perfect system
•National health systems
-Great Britain uses this system. -Finance a tax-supported national health insurance program: Government manages the infrastructure for the delivery of medical care. Most medical institutions are operated by government. Most providers are government employees.
Access is restricted in the United States to those who:
-Have health insurance through an employer -Are covered under a government program -Can afford to buy insurance out of pocket -Are able to pay for services privately
A health plan
-Is a contractual arrangement between the MCO and the enrollee -Includes a list of covered health services -Uses selected providers, usually primary care general practitioners (the "gatekeepers")
The VA health care system
-Is available to retired veterans -Focuses on hospital, mental health, and long-term care -Is one of the largest and oldest (1946) organized health systems in the world
The military medical care system
-Is well organized and highly integrated -Offers comprehensive services, both preventative and treatment oriented
Bureau of Primary Health Care (BPHC)
-Provides federal support for community health centers Programs for migrant farm workers, the homeless and public housing residents, and children
Children's Health Insurance Program (CHIP)
-Provides insurance to children in uninsured families
Systems framework: The Framework outlines
-System foundations -System resources -System processes -System outcomes -System outlook
•For the health care market to be free:
-Unrestrained competition must occur among providers, on the basis of price and quality. •A free market requires that patients have information about the availability of various services. •In a free market, patients as consumers must: -Directly bear the cost of services received. -Make decisions about the purchase of health care services.
Medicaid models
-Used by some states to manage costs and encourage innovation in health care delivery -Integration of primary care and behavioral health services
Public Health
1.Monitor health status to identify and solve community health problems 2.Diagnose and investigate health problems and hazards 3.Inform, educate, and empower people about health problems and hazards 4.Mobilize the community to identify and solve health problems 5.Develop policies to support individual and community health efforts 6.Enforce laws and regulations to protect health and safety 7.Provide people with access to necessary care 8.Assure a competent and professional health workforce 9.Evaluate the effectiveness, accessibility, and quality of personal and population-based health services 10.Perform research to discover innovative solutions to health problems
What is socialized health insurance (SHI)?
In a socialized health insurance system, health care is financed through government-mandated contributions by employers and employees. Health care is delivered by private providers.
Quest for Integration and Accountability
In the U.S., there is: -A drive to use primary care as the organizing hub for continuous and coordinated health services with seamless delivery. Accountability --Ethically providing quality health care in an efficient manner. --Safeguarding one's own health and using resources sensibly.
What is managed care?
Managed care is a system of health care delivery that seeks to achieve efficiencies by integrating the basic functions of health care delivery and employs mechanisms to control utilization of medical services and the price at which the services are purchased.
What is the difference between national health insurance (NHI) and a national health system (NHS)?
National health insurance is a tax-supported mechanism in which the government guarantees a basic package of health services to all citizens. The government finances health care through tax dollars, but the actual care is delivered by private providers. In a national health system, in addition to financing a basic health package, the government also manages the infrastructure for the delivery of medical care. Under such a system, most of the medical institutions are operated by the government; health care providers, such as physicians, are government employees. Essentially, a national health system is a national health insurance program, but it goes one step further in managing the infrastructure as well.
Accountable Care Organization (ACO)
New model of integrated organization, is expected to respond to new payment incentives and be held accountable for better quality outcomes at lower costs under the new Medicare Shared Savings Program.
•Systems framework
Systems consist of a set of interrelated and interdependent components designed to achieve some common goals -Explains the structure of health care services in the United States based on the foundations -Provides a logical arrangement of various components -Demonstrates a progression from inputs to outputs An organized approach to understanding the components of the U.S. health care delivery system
What is the primary reason for employers to purchase insurance plans to provide health benefits to their employees
The United States does not have a universal health care system covering all citizens. Health insurance is primarily employer-based. Employers purchase health insurance plans as a fringe benefit for their employees. Health insurance protects employees against the high cost of health care services.
Discuss the intermediary role of insurance in the delivery of health care.
The delivery of health care should be viewed as a transaction between the patient and the provider. However, the insurance function introduces a third party into this transaction. In free markets, the consumer makes purchasing decisions based on the prices and quality of goods and services. But health insurance insulates the consumer from the cost of health care. Hence, there is an artificial increase in the demand for health care services. Providers are sometimes restricted from delivering services that are not covered. At other times they can induce demand artificially simply because insurance will pay for the services.
What main roles does the government play in the U.S. health services system?
The government is a major financier of health care delivery through the Medicare and Medicaid programs. The government determines eligibility criteria as to who can receive services under these programs; it also determines the reimbursement rates that providers will receive for rendering services to Medicaid and Medicare patients. In order to render services to Medicaid and Medicare patients, health care facilities must be certified. These organizations must comply with the standards of participation formulated by the government. The government also regulates the health care industry through licensing of personnel and health care establishments.
Who are the major players in the U.S. health services system? What are the positive and negative effects of the often-conflicting self-interests of these players?
The key players in the system are the physicians, administrators of health service institutions, insurance executives, large employers, and the government. Each player has economic self-interests to protect. The conflicting self-interests of the various players produce countervailing forces within the system. One positive effect of these opposing forces is that they prevent any single entity from dominating the system. On the other hand, they also make it difficult to achieve system-wide reforms, particularly cost containment.
Under national health care programs
patients have varying degree of choice in selecting provider and true/free market forces are virtually non-existent