Exam 1 - Powerpoint 1 Flashcards
For which age groups does US lag furthest behind the best?
15-19 to 45-49
US Healthcare performance
perform poorly in terms of... affordability efficiency equity overall outcomes
% of GDP US spends healthcare
16.4%
Average is 8.9%
American Paradox
we spend so much on health, yet we get such poor results compared to other highly developed countries
Large disparities from surveying people
Preventive care Care coordination Affordability Having regular doctor or place of care Access to after-hours care and prompt specialist care
Where does US look good terms of healthcare?
Preventive care (vaccines, screenings, etc)
Safe care, including medication review
Patient engagement, including discussions and planning
1st Decades of the 1900s
Hospital mostly for delivery and surgeries
Paid with own money, Out of Pocket
Doctors charged Fee for service, was on sliding scale, flexible, installment plans
Great Depression (late 1920s - late 1930s)
Teachers in Dallas set aside small amount each week to cover hospital care at Baylor U Med Center if ever needed = Blue Cross
Spread to other states
created “Blue shield” to pay for physician visits
Blue Cross and Blue Shield joined in 1980s
WWII (1939-1945)
Labor unions couldn’t negotiate higher wages, instead went for fringe benefits ie Health Insurance
IRS laws in 40s 50s made employer-based healthcare tax free, increasing benefit relative to wages
Medical technology advances from war brought back by MDs
Post-War (Europe)
Focused on rebuilding infrastructure and providing basic services
Spirit of unity, reform, progress, socialism,
most advanced technology wasn’t priority
Post-War (USA)
Didn’t have to rebuild, focused on Teach and healthcare infrastructure
Higher Tech = Higher prices
How US Healthcare stands out from rest
spend alot more, relatively poor outcomes and characterized by inefficiency, inequity, and unaffordability
called “accident of history”, a WWII legacy
Many invested in current system, resisted changing it
Early Employment-Based Insurance
Early plans generous, employer paid most or all premium, and provided first-dollar coverage (no deductible and mostly zero cost sharing)
retrospective “fee for service” payments to providers
No constrains on premiums or fees on services
US vs UK
US
◉ Private coverage (until the mid 1960s)
◉ Lavish benefits for those who have coverage
◉ Covering even things that were not effective
◉ Retrospective, fee-for-service reimbursement
◉ High technology demand + no budget cap = very costly
UK
◉ National Health Service (= public, created 1946)
◉ Universal coverage
◉ Global budget: facilities work within an annual budget
◉ Shorter lengths of stay, fewer lab tests
◉ Less costly
Roemer’s Law
In an insured population, a hospital bed built is a filled bed”
This was used as justification for “certificate of need” laws to limit hospital growth, had to show a need. mostly controversial and repealed by now.
Technologic Imperative
Once technology is available, everyone wants it
A medical arms race, hospitals want it, doctors want to work at the best hospital etc.
Framingham heart study
Big, ongoing NIH-funded study in boston. started 1948
Most of what we know about causes and epidemiology of cardiovascular disease is from this
Medicare
Federal program For retirees Hospital and doctor visits No drugs Later included disabled and certain diseases
Medicaid
state-administered program
For certain low income individuals but not all
Not for able-bodied adults
Prioritized children, pregnant women and blind people
Moral Hazard
caused by 100% 1st dollar coverage, Fee-for-service, retrospective reimbursement
Doctor order more than needed cause “free”, patient wants all they can get or more…since its “free”…..spend way more and “over eat”
Who ends up paying for “Moral Hazard”
The employee (YOU!) either by lost wages, premium, etc
“3rd party payment” does what
Leads to market distortions, market failures
If patient does pay directly, don’t experience price as consequence
Information asymmetry
Patient doesn’t have complete info, cannot distinguish necessary care from wasteful care.
MD is expert and patient relies on MD’s recommendation
Supplier-induced demand
when providers are able to push consumers to consume more than they would have chosen to consume if they had been fully informed.
RAND Health Insurance Experiment
study in 1970s
more cost sharing = reduces use of both effective and ineffective car
up to 30% lower utilization among those facing higher OOP costs
Law of Diminishing Returns
as input are increased, there will be a point at which the marginal output will decrease
Flat of the curve
when an additional input produces no additional output at all.
Capitation
Per member per month payment/budget
Managed care organization
Grew in popularity in 1990s, provide full range of care
Prospective budge for providers
Providers restrict care to what is necessary and effective.
Shifts financial risk from insurer (payer) to MD or hospital (provider)
