chapter 19 Flashcards
what are major reasons for the growing cost of healthcare (4)
rising drugs
technology
professional costs
aging population
what is health care cost containment
measures designed to lower health care costs
aim to create affordable health care system for Americans
why is it important for HC providers to know economic aspects of health care
they can stay aware of how finances affect each patient’s experience
what are the three classes of healthcare facilities
voluntary nonprofit institutions
proprietary institutions
government institutions
what community services to facilities offer (7)
emergency room treatment
clinical service
health screening
community health education class + material
medical education
medical education
financial contributions to community organizations
coordination of events and donations
what is a voluntary nonprofit institution
community facility that receives federal, state, and local tax exemptions in exchange for providing community benefit
what do voluntary nonprofit institutions recieve
donations that are tax deductible for donors
-if they are operated for charitable purpose
what is a proprietary institution
for profit health care facility owned by a corporation
what does a health care corporation control
chain of facilities
hospitals
nursing homes
outpatient facilities
what is a government institution
public health care facility that receives local, state federal funding
includes
- military treatment facilities
- VA hospitals
- public and gov funded hospitals
- state mental hospitals and rehabilitation facilities
what are the three methods of paying for healthcare
private insurance
direct payment
government plans
what do most patients rely on for medical bills
employer provided health insurance coverage
what is private insurance
insurance obtained through place of employment
- because employers buy insurance for a group of people, they get better rates
how do insurance companies benefit form employer insurance
collect payments from everyone in the group, even though not all people in group incur the expenses covered by the insurance plan
how are companies lowering costs
placing financial responsibility on insured in the form of premiums, deductibles, co-insurance, co-pays
what is a premium
monthly amount paid to insurance company for heath insurance coverage
- employers pay a portion or all
what is a deductible
money person pays before the insurance policy provides benefits
- allows control of health care costs
- high deductibles = low premiums
what is co insurance or cooperative insurance
plans that require insured to share portion of the costs for health care services
(10-30%)
- lowers monthly premiums
what is a co pay
a flat fee paid directly to service provider every visit
what is direct payment
patients pay for health care with own money
why is direct payment used (3)
- private insurance does not cover ALL costs
- do not have private insurance
- do not qualify for government plan
what does direct payment do (2)
- cause individuals to “shop around” for health care consumers
- driving competition that drives down health care prices - may lead to bankruptcy
- 62% of bankruptcy in 2007 were linked to medical costs
- 75% of bankrupted individuals had health insurance
what is a governemnt plan
health care plan funded by a government agency
who are government plans available for (mainly)
active military personnel and their dependents
low income and older americans
what is medicare
fedreally funded health care program for older Americans
when was medicare established
amendments to the Social Security Act in 1965
why was medicare established
to provide health care coverage for Americans 65+ regardless of income or wealth
what happened to medicare in 1972
expanded to include permanently disabled workers who qualify for social security, and their dependents
what happened to medicare in 1983
to control health care costs, medicare converted to a prospective payment system
pays provider fixed amount that is based on diagnosis or specific procedure ,rather than on the actual cost of hospitalization or care
- if actual cost is > fixed amount, provider absorbs additional expense
differentiate btwn medicare part A and B
A = covers most inpatient care costs
- premium is already paid through payroll taxes
B = voluntary
- monthly premium
- covers most outpatient costs
what do people choose as an alternative to the medicare
supplemental insurance policy offered by private insurance company
what are two additional plan types to medicare
medicare advantage plans or medicare part C
- provide coverage for part A and B but have extra benefits
- lower copayment
D
- prescription drug coverage
- lower copayment
- extra payment
who does medicaid support
low income and disabled people
when was medicaid established
1965
as part of social security act
recieve SSI or supplemental security income benefits
what happened prior to 1996
people who recieved Aid to Families with Dependent Children (AFDC) were covered under medicaid
what was the AFDC program replaced by
Personal responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996
- provides states with block grants
- provide cash and services to low income families with children
- dependent on individual state regulations
what government health care plan is available for military personnel
the U.S department of defense administers
TRICARE
- provides medical coverage for active and retired service personnel and dependents
What is SCHIP
the State Children’s Health Insurance Program
- establishsed in 1997
provided states with matching funds to expand health care coverage to over 6 million insinsured children
what happened to SCHIP in 2007
was set to expire
legislation was going to expand the program by 35 billion but was vetoed by George W. Bush
What happened in 2009 about SCHIP
Obama signed in Children’s Health Insurance Program Reauthorization Act (CHIRPA)
- added 33 billion in funds for children’s coverage through 2013
describe health care costs in the US
grown at nearly twice the rate of inflation
- US spends more for health care services than any other nation as a percentage of GDP and per person
What is one response to rapid escalation in health care costs
managed care
- healthcare providers manage a patient’s use of healthcare
What are the 3 categories of managed healthcare
health maintenance organization (HMO) plan
preferred provider organization (PPO) plan
point-of-service (POS) plan
what is health maintenance organization (HMO) plan
plan provides coverage only if care is delivered by a member of it hospital, physician, or pharmacy panel
what is the preferred provider organization (PPO) plan
allows patients to receive care from a non-plan provider, but requires them to pay a higher out-of-pocket price if they do so
what is the point-of-service (POS) plan
physician coordinated plan combining characteristics of HMO and PPO
what are providers in managed care plans called
in-network providers
- cost is less than out of network
what are providers not in managed care plans called
out of network provider
what are 6 char. of managed care plans
consist of select group of hc providers
broad range of services to emphasize primary and preventive care
eliminate duplicate services
encourage cost containment
provide profit for HC provider and insurance company
include utilization review
what is utilization review
a process in which an insurer reviews decisions by physicians and other providers about how much care to provide
what is a gatekeeper
physician who delivers primary care services AND makes referrals for specialty care
describe time spend with managed care patients versus others
healthcare professionals spend 2 minutes less with managed care patients than other patients
what is the leading form of health care coverage for Americans
managed care
- 50% of insurance coverage provided by are managed care plans
what is the driving force behind effort to contain healthcare costs
diagnostic related group (DRG) classification system
what is DRG
patients with similar medical payments are assigned to DRG
- payment amount of DRG is based on average of all patients
- patients care is paid in standard fees, regardless of actual cost of care
what is assigning of DRG based on (4)
diagnosis
surgical procedure
age
other information
are DRGs good or bad for hospitals
incentive for hospitals to operate more efficiently as they still receive full payments
what are 3 good results of DRgs
shorter hospital stays
more outpatient services
focus on early intervention and prevention
what is resource utilization
the best way to use health care resources
what are two good ways of resource utilization
conscientious time management
information technology
- electronic documentation
wha is a flexible spending account (FSA)
offered trough employer
paired with traidtional health insurancep olicy
common medical savings account option
money is put into FSA through payroll deductions, before it is taxed
- can be withdrawn for qualified medical expenses not convered by insurance policy
remaining funds are not transferred and must be spend each year
What is a HSA or health savings account
paired with high-deductible health insurance plan
- low premuims and high deductibles
offered through employer benefit program or arranged individually
use tax-free HSA dollars until deductible is met; to pay for qualified medical care
once deductible is met –> health insruance company pays for medical costs for the reaminder
left over funds are used in the future
what happens when you reach 65 with HSA
cna withdrawn the money for no expense
what is an advanctage of HSA
more involved with health care decisions
- less likley to undergo unecessary or exessive tests and doctor visists as money is coming out of savings account
