Lecture 13: Health Care Reform Flashcards
Cost of health care in the United States
- Health care is 16.4% of the U.S. Gross Domestic Product
- Trends are unsustainable
Access to health care in the United States
- Uninsured leads to more serious & more expensive care
- Uninsured care reduces preventive care
Quality of health care in the United States
- Life expectancy in the U.S. is 81.2 (W) and 76.4 (M)
- Behind many other countries
Attempts to Contain Costs
- Shift from fee-for-service to managed care
- Diagnosis-Related Groups (DRGs):
- Capitation for Medicare (Part A) Hospital Care
Professional Standards Review Organizations
Peer Review Organizations
Certificate-of-Need Requirements for Capital Improvements
Kerr-Mills Act (1960)
coverage for elderly indigent individuals
- Federal Effort to Increase Health Care Access
Medicare (1965)
social health insurance; coverage for those > 65 years,
disabled, or with kidney disease
-Federal Effort to Increase Health Care Access
Medicaid (1965)
Federal-state program for low-income individuals
- Federal Effort to Increase Health Care Access
HIPAA (1996)-health insurance companies must:
not deny coverage due to preexisting medical conditions,
as long as exclusionary period up to 1 year for that condition
sell to small employer groups & individuals who lose coverage regardless of their
health history
renew policies
include patient privacy requirements in law
Health Savings Accounts (HSA) — Medical Savings Accounts (MSA)
Tax-free savings accounts used for out-of-pocket medical expenses for high-deductible health (HDHP) insurance plans
Total out-of-pocket spending is capped
Limit changes annually
Flexible Spending Account (FSA) – employer based
Use for any approved medical or child care expense
“Use it or lose it” annually
Patient Protection & Affordable Care Act (ACA) 2010
- Expand access to healthcare services
- Tax penalty for those who don’t enroll in a health insurance plan
- Creates State-based or Federal health insurance exchanges
- Medicaid expansion—under age 65 and income up to 135% of federal poverty level
- Dependent coverage for adult children to age 26
Essential benefits (MUST) be covered! For ex:
- Outpatient visits
- Emergency Services
- Hospitalization
- Maternity care
- Mental health and SUDs
- Prescription drugs – not all but an essential formulary
- Rehabilitation
- Labs
- Preventive / wellness / chronic disease management
- Pediatrics
Affordable Care Act
Funding for increased access
Employer & individual tax penalties
Reduce amount allowed for contributions to FSAs
Tax on nonprofit hospitals failing to comply with new requirements
Annual fees for pharmaceutical manufacturing and health insurance
companies
High premiums ->
Lower consumer cost-sharing
Low premiums ->
Higher consumer cost-sharing
Marketplace Plans: Metal Levels
Platinum
Gold
Silver
Bronze
Platinum Level
Plan pays 90%
Consumer pays 10% for dedecutibles, Co-pays and Coinsurance
Gold
Plan pays 80%
Consumer pays 20%
Silver
Play pays 70%
Consumer pays 30%
Bronze
Plan pays 60%
Consumer pays 40%
Actuarial Value
% of total covered expenses (on avg)
Coinsurance
The percentage of costs of a covered health care service you pay after your deductible has been meet
Co-Payment
A fixed amount, you pay for a covered health care service after you’ve paid your deductible
- It’s a fee you pay when you receive a healthcare service
Cost-sharing
refers to the patients portion of costs for healthcare services covered by their health insurance plan
- Insurer and health insurer both pay a portion of your medical costs during the year
Outcomes of ACA
By March 2015—16.4 million previously uninsured people -> access to health insurance
Accountable Care Organizations (ACOs)
- Initiated by Medicare
- An organized group of providers, including
PCPs, who are accountable for the overall care of a patient population and follow processes to promote evidence-based,
high quality, and cost efficient care
ACO Models Include relationships between:
- Hospitals, providers and payers
- Hospitals & Physicians in a group practice arrangement
- Networks of individual practices
- Hospitals empoying physician groups
Shared savings program: for ACO
If quality & cost reductions are met ½ of the savings become a bonus to the ACO
Advanced Payment Model: for ACO
Upfront fixed payment
Upfront variable payment based on number of historically-assigned beneficiaries
Variable monthly payment based on number of historically assigned beneficiaries
Eligibility for ACO
Must manage a min. of 5,000 Medicare beneficiaries at least 3 years
ACO Flow of Funds
ACO -> Providers: Hospital, Primary Care and Specialty
ACO Enrollees -> Payer (Insurance plans) -> ACO ( By premiums)
ACO -> Providers ( By co-pay and deductibles)
General reforms
Implementation of ACA-mandated changes
Establishing insurance exchange
Expanding access to coverage
Public outreach for plans already available
Medicaid reforms
Cost containment
Improving efficiency
Current ACA Waiver:
- Delivery System Reform Incentive Payment (DSRIP) Program
New York State: DSRIP
Reform Goals:
- Reduce “avoidable” hospitalizations by 25%
- Create Performing Provider Systems (PPSs)
- Value based payment structrure
- Available data portal & analytics
DSRIP
Delivery System Reform Incentive Payment Program
- Made under Section 1115
- Incentive payments to hospitals and other providers that develop programs pr strategies to enhance access to health care, increase the quality and cost-effectiveness of care, and increase the health of patients and families served
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Professional Standards Review Organizations
a national network of utilization review programs that had dual responsibility for medical cost containment and quality assurance
