Module 3 Flashcards
Economic goods
- goods or service benefit to society and some degree of scarcity
- scarcity (demand) creates willingness to pay
- markets balance supply and demand using price and competition
why healthcare not normal economic good
- need not want
- inelasticity of demand
- asymmetry of information
- may not be easily understood by patient
moral hazard
- if something is free or subsidized you are more likely to consume it than if you had to pay for it yourself
insurance
- guarantee of compensation for specified risk in exchange for payment of premium
- a mechanism for risk pooling
why not pay for the healthcare we need out of pocket
- info asymmetry
- moral hazard
- lack of competition
finance models
- general taxation - taxed
- social insurance - typically employment based mandatory and not for profit
- private insurance - not mandatory
- out of pocket
pros and cons of general tax
pros - best at pooling risk, low admin costs, progressive
cons - no natural incentive to limit demand
pros and cons of social insurance
pros - politically feasible, more info to consumers about care costs
cons - less risk pooling, administratively complex, no coverage for unemployed
pros and cons of private insurance and out of pocket payment
pro - consumer choice
cons - regressive, high admin costs
types of private insurance
- supplementary - covers services excluded from public plans
- complementary - pays for extras
- duplicative/parallel - pays for services that are also covered under the public system
in Canada general tax
- prov public health insurance plans cover hospital and physician
in Canada supplementary private insurance
- dental, vision, Pharma
in Canada out of pocket
- over the counter Pharma and whatever you don’t have private insurance to cover
parallel private systems
- privately financed system is a duplicate alternative to public sector
copayment
financing for services is partially subsidized through public payment with the remainder coming from out of pocket or private insurance
group based system
certain pop groups are eligible for public coverage, others rely on private
sectoral system
certain health care sectors are entirely publicly financed others rely heavily on private
effects of parallel private system from paper
- suggest that it DOES NOT shorten waits in public system
- attract healthiest and perform less complex procedures, increasing complexity and of cases in public
- actually lengthen wait times
effects of copayments models
- deters health services use
- bundling effect –> increase in public expenditure (ex: cost of prescription may deter them from seeing doctor)
- crowding out effect
non Insured health benefits program
- provides eligible FN and Inuit with health care coverage not covered through other programs
- vision, dental, mental, medical supplies, medication, transportation
where do provincial funds go to
- service provision
- regional health authorities (fund hospitals)
other sources of funding
- workers compensation boards
- ICBC
- out of pocket
- private insurance
- voluntary and charitable donations
funding source of primary care
provincial public health insurance
funding source of public health
federal, prov, municipal
funding source of emergency care
provincial public health insurance (some out of pocket)
funding source of hospital services
provincial public health insurance
funding source of rehabilitation
inpatient - provincial public health insurance
outpatient - private insurance, out of pocket
funding source of pharma
inpatient - provincial public health insurance
outpatient - private insurance, out of pocket
funding source of mental health care
inpatient/outpatient psychiatry - provincial public health insurance
non physician professionals - provinces, private insurance, out of pocket
funding source of home/long term care
all over the map
funding source of dental care
mainly private insurance, out of pocket with some exceptions
has health spending growth kept in pace with inflation and pop growth
no
how do provinces and territories compare with health spending
- geography, differences in physician pay, pop density
- MUCH MORE EXPENSIVE IN TERR
what is the public private split
about 70% public, 30% private
- pretty consistent
where we spending most money (almost 60%)
- hospitals
- drugs
- physicians
health expenditure by age group
- highest for infants and elderly
key takeaways on graph of share of spending, share of population
population aging is a modest driver of increasing health care costs
true or false more economic growth comes more spending on health care
true
mechanisms to pay providers
fee for service
salary
capitation
incentive payments
fee for service
- health professional paid set amount for a service provided to a particular patient
pros and cons of fee for service
- physician autonomy
- lots of data
- encourages one problem per visit
- gov no control over cost or service
- encourage over service and more expensive procedures
- not teamwork
salary
- health prof employee of organization and responsible for services as outlined in employment contract
capitation
payment according to number of patients. Fee structure can include premium for complex cases and may be adjusted for sociodemographic differences. pays practise whether consult or not. practise team may include number of disciplines
incentive payments/pay for performance
payment for reaching target outcome
salary pros and cons
- don’t incentivize one problem per visit
- physician autonomy???
capitation pros cons
- discourage unnesessary work
- multidisciplinary teams
- reduce burden
- patient freedom
-creamskimming - roster who require limited care
incentive payments pros cons
- patients coerced into something??
payment arrangements for primary care physicians
fee for service in most… bc blended….. Ontario - reimbursed through capitation
specialist payment arrangements
- fee for service
- some use of alt payment
payment methods for institutions
- block funding/global budgets - paid certain amount per year to provide service
- activity based funding - payments are allocated funds based on the type and volume of services provided and complexity of patient
pro con of block funding
- know their budget
- doesn’t encourage increases in volume
- can favour cost control (moved from one sector to another)
pro con of activity based funding
- efficiency
- transparent
- incentives to increase activity level
- mitigate cream skimming
- increases in spending due to volume
- increase unessecary care?
- how much to fund???
payment arrangements of long term care
global in most provinces
payment arrangements of home and community care
mix of global and other payment
payment arrangements of prescription
fee for service
payment arrangements of hospitals
- historically global budgets… some mix
connection between funding and service delivery
- does not foster accountability for the clinical outcomes of patients beyond providers short slice
mechanisms to bridge payment silos
- bundled payments
- population based integrated payment models
bundled payments
- single payments that are disbursed to groups of provider entities involved in delivering a defined episode of care for a particular health condition or procedure
population based integrated payment models
single, time defined payments to groups of providers for a population of enrolled patients or residents of a particular geographic area, regardless of whether they use health services or not
- best for predictable
- like capitation
