Professionals in Health

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Professionals in Health

• The Health Care Delivery System

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Overview of the Health Care System

• Health Services are varied- based on perceived
  need and based on decision of the physician.

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Financial

• Funded by private insurance, personal funds or
  governmental health plans
• The federal government (for the most part) does
  not deliver health care.
• The federal government is involved with financing
  health care to the elderly (Medicare) and to the
  indigent (Medicaid)

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Health Care Industry4 Types of Service

• 1. Health Promotion- (Practice preventative
  medicine) reduce risk of illness, maintain
  optimal functioning, follow healthy lifestyles
• Vaccinations
• Prenatal nutrition classes
• Exercise classes

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• 2. Illness Prevention Education aimed at
  involving the consumer in own health
• recognition of risk factors
• occupational safety

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• 3. Diagnosis and Treatment
• Most used
• Technology has improved effectiveness
• Increased in cost

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• 4. Rehabilitation
• Restoration of a person to normal function after
  a physical or mental illness
• hospitals
• homes
• rehabilitative institutions

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Levels of Care

• Primary- ex. Physicians office
• Secondary ex. Hospital
• Tertiary- ex.- Long Term Care, Rehab

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Healthcare Defined by Function or Type of Service

• Inpatient- hospitals that offer acute care of
  no more than 30 days
• Long Term Care patients need continued nursing
  services for greater than 30 days nursing homes
• Outpatient-Ambulatory Care, clinics, education,
  rehab, therapy
• Community based- day cares, home health, half way
  houses
• Governmental VA hospitals
• Hospice-provides dignified death

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Hospitals

• Third largest business in the U.S.
• Employs 75 of health care personnel
• Is a complex industry-categorized by 3 methods
• function or type of service
• length of stay
• ownership

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Ownership

• Proprietary
• Doctors Hospital, Sarasota, FL
• Non-proprietary
• Mercy Medical Center, Cedar Rapids, IA
• Government/ Public
• Veterans Administration Medical Center
• State
• University of Iowa Hospitals and Clinics
• Local (County or City)
• Davis County Hospital, Bloomfield, IA

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Ambulatory Care Examples

• Medical and Dental Practices
• Hospital Outpatient
• Industrial Health Units
• Public Health Clinics

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Behavioral Health Services

• Acute Inpatient services on a psychiatric unit
• Outpatient therapy through a counselor or
  physicians office
• Old terminology-Mental Health

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Home Health Care

• Care provided in home
• Nursing care
• Home health aide
• Assist with household tasks
• Medical supplies
• Physical and Occupational Therapy

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Managed Care

• HMOs- Health Maintenance Organization- provides
  basic and supplemental health maintenance and
  treatment series to enrollees
• Kaiser Permanente- California
• Group Health - Washington D.C.

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Consumer Rights The American Hospital
Association Patient Bill of Rights

• Receive information pertaining to diagnosis and
  treatment
• Receive information on fees for services rendered
• Receive continuity of care
• Refuse diagnostic and treatment procedures
• Enjoy privacy and confidentiality
• Right to seek a second opinion
• Change providers if hot satisfied

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Health Care Costs

• There are 4 major problems with U.S. health care
  relative to cost
• 1. Exorbitant cost
• 2. Health care is fragmented- consumers no
  longer have a family doctor. Instead may have
  specialists that do not communicate with one
  another. Leads to duplication of services and
  increased costs

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Health Care Costs continued

• 3. Technological changes lead to need for
  continual education and training costs for
  practitioners
• 4. Uneven distribution of health care

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Paying for Health Care

• Background-Four factors have changed health care
  in the past 20 years
• 1. Fear of Medicare going bankrupt. Led to
  prospective payment (DRGs) 1983.

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DRGs (Diagnostic Related Groups)

• Hospitals are paid a set amount for each patient
  in any of the established 518 DRGs
• The government will not pay beyond the set fees
  for the individual illness, no matter how long
  the patient stays or what services are received.

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Result of DRGs

• Decrease in length of stays
• Need for increased efficiency
• Physicians paid with a similar system in 1992.
  (Resource Based Relative Value System/RBRVS)

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Paying for Health Care

• 2. Shift in Balance of Power
• Labor unions lost power in the 1980s
• Workers had come to expect high frequency of
  service with no copayments
• Employers shifted to less costly managed care
  plans, that had copayments and more limits on
  services covered.

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Paying for Health Care

• 3. Surplus of Doctors
• 1960s- government took steps to increase number
  of physicians to care for Medicare population
• Supply of doctors increased 57 from 1970-1990
  while population increased by 30
• Result Oversupply, competition, reorganization
  and advertising

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Paying for Health Care

• 4. Medical Technology
• Services are provided outside of the hospital due
  to better technology.
• Free standing surgical clinics, out-patient
  clinics

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Changing Objectives of Health Insurance

• Early 1900s- beginning of health insurance in
  the U.S. Goal is to eliminate the economic
  burden of illness

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After WWII

• Medical resources expanded.
• Government eliminated taxation on employer
  provided insurance premiums.
• Fringe benefits increased instead of wages
• Insurance rates increased instead of cost
  containment

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WWII-1980s

• Increase percentage of national income channeled
  to health.
• Cost control not pursued
• Medicare and Medicaid paid provides based on past
  charges- therefore providers raised charges
  instead of containing costs

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1980s to present

• Managed care growth in an effort to contain cost
• Hospitals diversify to include ambulatory care
• Hospitals attempt to contain costs

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of GNP Spent on Health Care

• 1965 5.9
• 1979 9.1
• 1997 14

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Health Care Financing

• Hospital 40
• Physician 20
• Long-term care, pharmacy, dental 32
• Misc 8

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Who Pays?

• Most is paid through government programs and
  health insurance (third party payers)
• Those with private insurance have better access
  to resources
• Most employers offer managed care options

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Who Pays? continued

• 52 of Medicare recipients are in HMOs
• Patient care decisions are determined by the
  organization to which they subscribe and
  primarily are determined by cost.

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Regulation of MCOs

• Consumer complaints of physicians not being in
  control have increased.
• 980 bills of legislation in 49 states were
  introduced in 1997 to provide consumer protection

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Physician Reimbursement

• Fee for service the problem is establishing what
  is included in a service. The more service
  provided more cost
• Capitation physician is paid a fixed amount per
  person per fixed unit of time. The physician is
  incentives to provide only preventive and
  necessary services
• Salary the provider is hired by organization and
  HMOs. The incentive is to be productive.

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Health Insurance in the U.S.

• Who is covered?
• Virtually 100 of population over 65 yrs is
  covered by Medicare
• 3 out of 5 over 65 have supplemental coverage
  (private)
• 80 under 65 have private insurance for inpatient
  services
• 60 under 65 have insurance for outpatient
  services
• 40 under 65 have dental insurance

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Health Care Coverage Has Changed

• The number of benefits has increased
• Employers pay 70 of premiums

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History of Insurance Coverage

• 1930s- Blue Cross/Blue Shield.
• BCHospital coverage
• BSOutpatient services
• BC plans spread the risks of losses across all
  segments of the population. All premiums were
  the same

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1950s

• Commercial insurance offered lower rates than
  BCBS. Resulted in competition.
• Insurers denied groups with high risk, the poor
  and the aged
• Led to Medicare and Medicaid

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Medicare

• Federal program for those 65 over some
  disabled are eligible
• Entitles same coverage as middle income people
  have
• Run by HCFA (Health Care Finance Administration
  of the U.S. Department of Health and Human
  services (USDHHS)
• Now changed to CMS (Center for Medicare
  Medicaid Services)

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2 Parts to Medicare

• Part A
• Hospital insurance
• Has deductible and coinsurance
• Pays 60 days of inpatient per hospital stay plus
  20 days of skilled care

• Part B
• Medical insurance
• Has a monthly premium, deductible with the
  patient paying 20 of the approved amount

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Medicaid

• Federal/State cooperative program to insure
  poor/indigent
• Income must be below the poverty level.
• Some providers dont accept these patients due to
  lower reimbursement.
• 60 of nursing home bills are paid by Medicaid

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Managed Care

• Definition- A system in which employers and
  health insurers channel patient to the most cost
  effective place of service

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HMO

• Health Maintenance Organization
• Benefits cover hospital, physician and ancillary
  services.
• Incentive is for efficient and effective care
• Greatest drawback is patient must find a provider
  who is a member of the HMO
• 20 of US population has HMO coverage

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PPO

• Preferred Provider Organization
• A group of providers who have joined together to
  provide health care
• Providers may be hospitals, physicians, etc.

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PPO

• fee for service
• contractual agreement
• organization of providers

• Discounts
• Free Choice
• Economic incentives

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Biggest Impact of Managed Care

• Decrease in hospital inpatient use.

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Effect of Managed Care on Health Care Providers

• Increase demand for family practitioners, nurses
  and therapists outside of the inpatient hospital
  setting.
• Rehab services will continue to be at a high
  demand